author: CULVER, Justice. SMITH, Justice

text:
    PAN AMERICAN INSURANCE COMPANY, Petitioner, v. HI-PLAINS HAULERS, INC., Respondent.
    No. A-8172.
    Supreme Court of Texas.
    Oct. 18, 1961.
    Rehearing Denied Nov. 22, 1961.

      Simpson, Adkins, Fuliingim & Hankins, Richard E. Stokes, Jr., with above firm, Amarillo, for petitioner.
    Underwood, Wilson, Sutton, Heare & Berry, H. C. Pipkin, Jr., with above firm, Amarillo, for respondent.
   CULVER, Justice.

This suit grows out of a claim under the Workmen’s Compensation Act against the compensation carrier, Pan American Insurance Company, on account of injuries sustained by Albert W. Harris, an employee of Yellow Cab and Baggage Company. In a settlement of this claim Pan American paid to Harris the sum of $3,S00 plus $480.05 for medical and hospital expenses. Thereafter, Harris filed this suit against Hi-Plains Haulers, Inc., as a third party tort-feasor. Pan American intervened pursuant to Sec. 6a of Art. 8307, Vernon’s Ann.Civ.Stat., to recover the amount paid by it to the employee, together with a reasonable attorney’s fee. During the pendency of the suit Hi-Plains settled with Harris by paying him $1,750 and thereupon tendered an identical amount to Pan American, which tender was refused and the case proceeded to trial. The jury found Hi-Plains guilty of negligence, and assessed the damages sustained by Harris in the sum of $1,500. The trial court rendered judgment for Pan American against Hi-Plains in accordance with that verdict.

On appeal the Court of Civil Appeals affirmed the judgment in so far as that recovery was concerned, but reversed and remanded the cause, directing the trial court to include in its judgment the sum of $480.-05, the amount paid by Pan American for hospital and medical services rendered to Harris, plus such attorney’s fee as might be found to be reasonable. 341 S.W.2d 191.

Both parties applied for writs of error. Hi-Plains contends that the Court of Civil Appeals erred in adjudging it liable to Pan American for the hospital and medical expenses and the attorney’s fee.

Pan American alleges that the judgment of the Court of Civil Appeals is erroneous for the reason that in addition to the $1,500 awarded it by the trial court upon the jury verdict, it is entitled to the sum of $1,750, the amount paid to Harris by Hi-Plains in the agreed settlement. In the alternative Pan American says that it is entitled as a matter of law to judgment against Hi-Plains to the full extent of the amount paid by it in the settlement of the claim for compensation, since the jury found that the negligence of Hi-Plains proximately caused the damages sustained by the employee, Harris.

Under the facts in this case we hold that Pan American is not entitled to recover the attorney’s fee as allowed by the Court of Civil Appeals. Its entire claim for recoupment is founded on Sec. 6a of Art. 8307, Vernon’s Ann.Civ.Stat., the pertinent part of which reads as follows:

“If compensation be claimed under this law by the injured employé or his legal beneficiaries, then the association shall be subrogated to the rights of the injured employé in so far as may be necessary and may enforce in the name of the injured employé or of his legal beneficiaries or in its own name and for the joint use and benefit of said employé or beneficiaries and the association the liability of said other person, and in case the association recovers a sum greater than that paid or assumed by the association to the employé or his legal beneficiaries, together with a reasonable cost of enforcing such liability, which shall be determined by the court trying the case, then out of the sum so recovered the association shall reimburse itself and pay said cost and the excess so recovered shall be paid to the injured employé or his beneficiaries.”

We think the statute clearly limits the carrier’s recovery to the amount assessed as damages but if on the other hand such damages may be in excess of that paid by the carrier to the employee the carrier may collect “a reasonable cost of enforcing such liability” out of that excess. An attorney’s fee was allowed both in Fort Worth Lloyds v. Haygood, 151 Tex. 149, 246 S.W.2d 865, and in Traders & General Insurance Co. v. West Texas Utilities Co., 140 Tex. 57, 165 S.W.2d 713, but in each of those cases the settlement between the employee and the third party was in excess of the amount of compensation paid by the carrier.

Our decision in Smith v. Henger, 148 Tex. 456, 226 S.W.2d 425, 20 A.L.R.2d 853, does not run counter to our holding here. In that case the objection to the allowance of an attorney’s fee was raised by the deceased employee’s beneficiary. She complained because the allowance would be paid out of the excess over and above the amount of compensation paid to her. Thus, the implication in that decision is merely that the court reached the same conclusion as it did in the two foregoing cases. If this were only a suit by Harris against Hi-Plains there could be no contention that in addition to the damages recoverable, Harris would be allowed an attorney’s fee for bringing the suit. The intention of the Legislature, we think, was not to increase the third party’s liability by providing for the right of subrogation in favor of the compensation carrier.

On the trial it was stipulated that Pan American paid “on behalf of Albert

W. Harris medical and hospital expense aggregating $480.05.” No issue concerning these expenses was stipulated to the jury and neither was any testimony offered to support the finding that they were reasonable and necessary. Before Harris could recover his medical expense he must have proved that it was reasonable and necessarily incurred. Dallas Railway and Terminal Co. v. Gossett, 156 Tex. 252, 294 S. W.2d 377. This case was appealed without a statement of facts and we are of the opinion that the trial court did not err in refusing to include the amount of that expense in the judgment.

Pan American argues that since the jury must not be informed of the amount of benefits paid to the employee by the insurer in settling the claim for compensation as held in Myers v. Thomas, 143 Tex. 502, 186 S.W.2d 811, therefore it would have been reversible error to have presented evidence as to the medical expense paid and the necessity for a reasonableness thereof. This assumption is not correct. The point is that it is improper to introduce before the jury evidence as to the amounts paid by the insurance company, but it would not be erroneous to introduce evidence as to what the medical expense amounted to and whether it was reasonable and necessary for the treatment of the injuries sustained. This is as much an essential part of the damages that Harris might recover from the third party as the physical injury and pain suffered by him.

We proceed now to the contention of Pan American that it should be awarded additionally the sum of $1,750 which was the amount paid by Hi-Plains to Harris in settlement of his claim.

It is now the law in this state that the third party’s negligence need not be judicially established before the compensation carrier is entitled to assert its claim for subrogation and where the employee and the third party entered into a settlement, both employee and the third party were liable to the carrier for the amount so paid up to the amount of compensation paid by the carrier to the employee. Traders & General Insurance Co. v. West Texas Utilities Co., supra. Likewise it was held in Fort Worth Lloyds v. Haygood, supra [151 Tex. 149, 246 S.W.2d 869], that the first money “paid or recovered by the employee, or his representatives, belongs to the compensation carrier paying the compensation, and until it is paid in full, the employee, or his representatives, have no rights to any funds; * *

Under the law thus announced we are of the opinion and so hold that Pan American is entitled to a judgment against Hi-Plains for the sum of $1,750 which was the first money paid in this case. The contention made by Hi-Plains, however, is that this amount was tendered and refused and Pan American elected to proceed with its suit and therefore was entitled to recover only the sum of $1,500 and no more, being the amount fixed as damages.

We have found no case squarely in point but we are of the opinion that Pan American was entitled to collect the $1,750 without being required to release Hi-Plains from any further demands. Pan American had the right to proceed to trial and have submitted to the jury the amount of damages. If the amount so found was equal to or in excess of the compensation so paid then Pan American would have been entitled to collect from Hi-Plains in full. In this case, however, the jury found that the damages were only $1,500, less than the amount paid by Hi-Plains in settlement.

The limit of Hi-Plains’ liability, had there been no settlement, was the amount of damages occasioned by its negligence and no more. On the face of things Hi-Plains made a rather unfavorable settlement, but it is not to be punished or penalized for that by having to suffer what would in effect be a double recovery or to have its liability increased by more than the sum it paid in settlement.

Pan American’s alternate contention that, merely because the jury found Hi-Plains negligent, it thereby became liable to Pan American for the full amount of all sums paid to the employee, is not a sound theory nor is it founded on any authorities. No decisions to that effect are cited. It is therefore overruled.

We therefore hold that Pan American is entitled to a judgment against Pli-Plains Haulers, Inc. for the sum of $1,750 and no more.

The judgments of both courts are therefore reversed and the cause remanded to the trial court for the entry of judgment in accordance with this decision. It is so ordered.

CALVERT, C. J., and GRIFFIN, SMITH and HAMILTON, JJ., dissenting.

SMITH, Justice

(dissenting).

I respectfully dissent. Pan American’s contention that the payment by Hi-Plains to Harris, and the receipt by Harris of the sum of $1,750 in settlement of his claim for damages, all with the knowledge of Pan American’s right of subrogation, rendered Hi-Plains liable as a matter of law to Pan American for the sum of $1,750 has, in effect, been sustained by the Court. The Court holds that Pan American was entitled to collect the $1,750. This part of the holding is correct. When Hi-Plains paid and Harris received $1,750 in settlement of his claim for damages with full knowledge of Pan American’s rights of subrogation, Hi-Plains and Harris became liable to Pan American jointly and severally to the extent of an equal sum of $1,750. The money paid over to Harris by Iii-Plains, actually, in law, belonged to Pan American. Therefore, the trial court erred in granting Hi-Plains’ motion to require an election of remedies, and in ordering Pan American to elect in writing whether it would accept the “sum of $1750.00 by way of full compromise and settlement of its entire interest in the cause of action * * or whether * * * Pan American Insurance Company desires to determine the liability, if any, of * * * Hi-Plains * * to * * * Harris, to the extent of the interest of Pan American Insurance Company therein under the terms of Sec. 6a of Art. 8307, RCST.”

The holding of the Court that Pan American is not entitled to recover the sum of $1,500 awarded by the jury, in addition to the sum of $1,750 is out of harmony with the stipulated facts, the release agreement executed by Pli-Plains and Harris, and the law as declared by the Supreme Court of Texas.

I cannot agree with the Court that the amount of the damages awarded by the jury and the trial court must be equal to or in excess of the compensation paid by Pan American to Harris before Pan American would be entitled to collect from Hi-Plains in full. This is the sole reason given by the Court for not awarding judgment in favor of Pan American for the $1,500 in addition to the sum of $1,750.

The stipulated facts and the release agreement refute this holding. It was stipulated that as the result of the injury received by Harris, the Pan-American Insurance Company was caused to expend the sum of $3,500 as compensation to Harris, and the sum of $480.85 for medical and hospital expenses, a total of $3,980.85; that the settlement between Harris and Hi-Plains was made without the consent, participation, knowledge, approval or acquiescence of Pan American, and with full knowledge on the part of Hi-Plains of Pan American’s right of subrogation. That they had such knowledge and well knew that in the event Pan American established that the injury sustained by Harris was proximately caused by the negligence of Hi-Plains, Pan American would be entitled to judgment against Hi-Plains for whatever sum in damages should be awarded by the trial court, whether such sum should be more or less than $3,980.85, is conclusively shown by the settlement agreement executed by Harris and Hi-Plains. The settlement agreement was introduced in evidence as a part of the stipulated facts. The portion of the written agreement pertinent here, reads as follows:

“It is understood and contemplated by the parties that Pan American Insurance Company, intervenor, * * * has paid to said Albert W. Harris workmen’s compensation and medical expenses [$3980.85] * * *; and there is expressly excepted from the terms of this compromise and settlement and reserved to said Pan American Insurance Company its interest in said cause of action of Albert W. Harris by virtue and to the extent of the workmen’s compensation payments and medical expenses made by said Pan American Insurance Company heretofore, to or on behalf of said Albert W. Harris as a result of said accident and injuries of Albert W. Harris sustained therein. But it is expressly understood and agreed that except for and only to the extent of the interest of said Pan American Insurance Company in said claim and cause of action, this compromise and settlement is in full and complete discharge of the entire remaining interest of the said Albert W. Harris in and to said claim and cause of action against the parties to this compromise and settlement agreement; and that said payment of $1,750.00 is made by The Travelers Insurance Company to for the sole use and benefit of the said Albert W. Harris individually and compromise and settlement, release and discharge of the cause of action asserted by him in the above entitled and numbered cause, excepted only to the extent of such interest therein as has accrued to said Pan American Insurance Company under Article 8307, Section 6a, RCST. It is also specially understood and agreed that this compromise and settlement agreement is intended only for the benefit of Albert W. Harris, Hi-Plains Haulers, Inc., Levi C. Holt and The Travelers Insurance Company, and is the compromise and settlement and release and discharge of a doubtful and disputed claim, liability for which is denied by said Hi-Plains Haulers, Inc., Levi C. Holt and The Travelers Insurance Company as shown by their answer filed in the above entitled and numbered cause and the nature and ‘extent of the injuries alleged by the plaintiff being disputed; and that the payment herewith made and the terms of this settlement is in no event to be construed or constitute any admission of liability by Hi-Plains Haulers, Inc., Levi C. Holt and/or The Travelers Insurance Company to said Pan American Insurance Company, its successors or assigns.”

Then again near the closing paragraph of the agreement, the parties agree that Harris shall be forever barred from asserting any claim or cause of action against “the remaining parties hereto, * * * excepting from this compromise and settlement, release and discharge, only the interest of said Pan American Insurance Company in and to said claim and cause of action as to the extent asserted by it in its First Amended Original Answer on file in this cause.”

The claim asserted by Pan American was for a recovery of damages. Pan American adopted the pleadings of Harris and those pleadings prayed for a recovery of damages in the sum of $47,500, plus medical and hospital bills. Nothing contained in the agreement placed a limitation on Pan American’s recovery. Therefore, the “extent” of Pan American’s claim would naturally be only limited by the amount paid by Pan American to Plarris in settlement of Harris’ claim for workmen’s compensation in the event the jury award in damages exceeded such payment. The jury verdict was for only $1,500. By the very terms of the settlement agreement, Hi-Plains and Harris admitted that Pan American would b. entitled to the sum in damages which might be awarded by the court’s judgment based upon the verdict of the jury, the trier, of the facts in this instance.

Since the money paid by Hi-Plains to' Harris in settlement was less than the amount of compensation paid by Pan American to Harris, Pan American was entitled to receive from Hi-Plains and Harris the amount of $1,750 paid to Harris, and in addition thereto it was entitled for its benefit, but in the name of Harris, to assert the original claim and cause of action by Harris against Hi-Plains in order to make itself whole. Hi-Plains recognized this right. In fact, Hi-Plains filed a motion in the trial court that judgment for Pan American be limited to $1,500, the exact amount awarded by the jury. Pan American was clearly entitled to this additional recoupment.

Pan American’s subrogation rights were not only stipulated and agreed upon by Hi-Plains and Harris, but were definitely fixed by Section 6a of Article 8307, Vernon’s Annotated Civil Statutes of Texas. This statute does not provide for separate causes of action. Under the statute, there is but one cause of action against the third party tort feasor. See Texas Employers’ Ins. Ass’n v. Texas & P. Ry. Co. et al., Tex.Civ.App., 129 S.W.2d 746, wr. dism. judg. cor.

Pan American was not compelled by statute or otherwise to accept the tendered payment of $1,750 in full and final settlement of all of its subrogation rights. The money paid over to Harris by Hi-Plains, actually, in law, belonged to Pan American. It had the right under the statute to be reimbursed out of the first monies paid to or recovered by Harris. See Traders & General Insurance Company v. West Texas Utilities Company, 140 Tex. 57, 165 S.W.2d 713; and Fort Worth Lloyds v. Haygood, 151 Tex. 149, 246 S.W.2d 865.

There is no distinction, in principle, between the present case and the two cases last cited. In the present case, Pan American was required to proceed with the Harris cause of action against Hi-Plains if it expected additional recoupment. It did just that and in the trial judicially established that acts of negligence charged against Hi-Plains were the proximate cause of the injuries sustained by Harris. The answers of the jury to the issues inquiring as to the contributory negligence of Harris were all favorable to Harris. The jury also found that the collision in question was not the result of an unavoidable accident;

The fact that the jury verdict and judgment of the trial court was for $1,500, a sum less than the amount of money paid to Harris, does not mean that Pan American is to be denied a recovery of the jury award. Pan American is entitled to a recovery of the $1,500 awarded by the judgment of the trial court, in addition to a recovery of $1,750, the amount of the settlement payment by Hi-Plains to Harris. Both sums are to be considered as money paid over to the employee within the meaning of Section 6a of Article 8307, supra. This conclusion is inescapable in the light of the holding of this Court in the cases of Traders & General Insurance Company v. West Texas Utilities Company, supra, and Fort Worth Lloyds v. Haygood, supra. This Court said in Traders & General, supra [140 Tex. 57, 165 S.W.2d 716] :

“ * * * It is pointed out in Fidelity Union Casualty Company et al. v. Texas Power & Light Company, Tex. Civ.App., 35 S.W.2d 782, 783, writ refused, that such ‘right of subrogation has existence only in the terms of this statute [sec. 6a] and it can be enforced only as therein directed.’ It is also stated in the opinion that ‘the amount to be recovered’ against the third person tort feasor is ‘to be appropriated between the parties as directed by the statute,’ that is, that the association first recoup itself out of the amount recovered, and that the excess only be paid to the injured employee. The money paid over to the employee therefore belonged, under the law, to Traders & General and both the company and the employee were charged with knowledge of that fact and had actual knowledge that Traders & General was asserting its subrogation rights in the cause at the time the settlement was made. The right of the association to reimbursement out of the first money paid is statutory; and in event the employee is permitted, without the consent of the association, to settle his claim against the alleged third person tort feasor, thus eliminating his further interest in the suit, the provision of the statute authorizing the insurance association to enforce for the joint use and benefit of said employee and the association the liability of such tort feasor, is thereby nullified. * * * The money belonging to Traders & General was wrongfully paid by the utilities company to the employee, who wrongfully received it, and both were thereby rendered liable to pay to Traders & General the amount of compensation theretofore paid by it to the employee, together with the costs of enforcement, including a reasonable attorney’s fee therefor.” [Emphasis added.]

To fail to apply here the principle announced in Traders & General, supra, would be in contravention of the legislative purpose in enacting Sec. 6a, supra.

In the case of Fort Worth Lloyds v. Haygood, supra, this Court cited with approval several cases, including Traders & General, supra; Houston Gas & Fuel Co. v. Perry, 127 Tex. 102, 79 S.W.2d 623, 91 S.W.2d 1052; Hanson v. Ponder, Tex.Com.App., 300 S.W. 35; and Galveston-Houston Electric Ry. Co. et al. v. Reinle et al., Tex.Civ.App., 264 S.W. 783, wr. ref., 113 Tex. 456, 258 S.W. 803. The Court then went on to hold-: “[T]he fundamental principle underlying the * * * cases cited above is that where compensation has been paid to an injured employee, or his representatives, and they later file suit against the third party tort-feasor, the first money paid or recovered by the employee, or his representatives, belongs to the compensation carrier paying the compensation, and until it is paid in full, the employee, or his representatives, have no rights to any funds * * .[Emphasis added.]

The judgment of the Court of Civil Appeals should be reversed and judgment should be rendered for Pan American against Hi-Plains for the sum of $3,250.

CALVERT, C. J., and GRIFFIN and HAMILTON, JJ., join in this dissent.


source: Caselaw Access Project

author: MORRISON, Judge.

license: Public Domain

text:
    Bobby Lee RHODES, Appellant, v. STATE of Texas, Appellee.
    No. 33782.
    Court of Criminal Appeals of Texas.
    Nov. 8, 1961.
    Jack Pierce, H. L. Edwards, Nacogdoch-es, for appellant.
    Leon B. Douglas, State’s Atty., Austin,, William E. Carroll, Dist. Atty., Jasper, for the State.
   MORRISON, Judge.

The offense is murder; the punishment, seven years.

No statement of facts accompanies the record.

The sole question presented for review is the action of the trial court in overruling appellant’s motion to quash the special ven-ire.

Appellant’s bill of exception reflects that, contrary to Article 592, Vernon’s Ann.C. C.P., the special venire for the trial of this case was drawn from only two of the weekly jury panels drawn by the jury commissioners instead of being drawn from all five of the weekly jury panels selected for that term of court.

The State strongly contends • that in the absence of a showing of injury to appellant this case should be affirmed, notwithstanding the clear violation of Article 592, V.A. C.C.P., and cites Williams v. State, 164 Tex.Cr.R. 381, 298 S.W.2d 833, Rogers v. State, 163 Tex.Cr.R. 260, 289 S.W.2d 923, and De Vault v. State, 159 Tex.Cr.R. 360, 264 S.W.2d 126, as authority for this contention.

On rehearing in Rogers v. State, supra, we affirmed the trial court’s action in discharging eight women jurors because at that time there was no specific legislation authorizing the separation of men and women jurors, but that case must be strictly-limited to the circumstances there existing and is no authority for the State’s contention here.

In De Vault v. State, supra, the officers, acting under a misapprehension as to the requirements of Article 591, V.A.C.C.P., failed to return cards bearing the names of the jurors not impaneled to the jury wheel, resulting in the special venire being drawn from a wheel containing 314,000 names when it should have contained 317,000 names. In addition to pointing out that the proportion of those drawn from and not returned to the wheel to the number in the wheel at the time of the drawing of that venire was infinitesimal, we were careful to observe that there was no evidence of arbitrary or capricious conduct involved in impaneling the jurors.

In the case at bar, the special venire was drawn from two weekly jury panels containing 36 names each instead of being drawn from all five jury panels for the term containing 192 names, and no reason or excuse was offered for failure to comply with the statute; and it thereby follows that appellant was deprived of 120 out of 192 veniremen, which proportion could in no way be termed infinitesimal. The undisputed facts of this case reflect an arbitrary and capricious disregard of Article 592, V.A.C.C.P., and we do not regard the De Vault case as controlling here.

Williams v. State, supra, was a case arising under Article 2096, Vernon’s Ann.Rev. Civ.St., and the accused was not deprived of any names in the drawing of the jury for his case. We there quoted from the De Vault case in pointing out that there was no arbitrary or capricious conduct involved in impaneling the jurors; therefore, that case does not support the State’s contention here.

This Court has long held that a denial of the rights extended by statute providing for the manner in which a special venire is to be drawn is fundamental error. Tuley v. State, 151 Tex.Cr.R. 71, 204 S.W. 2d 611; Moore v. State, 132 Tex.Cr.R. 403, 105 S.W.2d 250; Wallace v. State, 50 Tex. Cr.R. 374, 97 S.W. 471; and Oates v. State, 48 Tex.Cr.R. 131, 86 S.W. 769.

Article I, Section 15, of our Constitution, Vernon’s Ann.St. provides that the right of trial by jury shall remain inviolate and that the Legislature shall pass such laws as may be needed to regulate the same and to maintain its purity and efficiency.

When the Legislature has provided a method and means by which a special venire must be selected, we will not uphold an intentional departure from the plain provisions of the statutory enactment.

Because the trial court erred in overruling appellant’s motion to quash the special venire, the judgment is reversed and the cause is remanded.


text:
    Soco SEGORIA, Appellant, v. STATE of Texas, Appellee.
    No. 33841.
    Court of Criminal Appeals of Texas.
    Oct. 25, 1961.

      No attorney for appellant of record on appeal.
    Frank Briscoe, Dist. Atty., Samuel H. Robertson, Jr., Asst. Dist. Atty., Houston, and Leon B. Douglas, State’s Atty., Austin, for the State.
   MORRISON, Judge.

The offense is the illegal possession of heroin, a narcotic drug; the punishment, enhanced by two previous convictions for felonies less than capital, is life imprisonment.

The record on appeal contains no statement of facts.

Appellant presents two formal bills of exception in the transcript which cannot be considered because they were filed after the ninety days provided in Article 760d, Vernon’s Ann.C.C.P. Green v. State, Tex. Cr.App., 343 S.W.2d 458; Mendoza v. State, Tex.Cr.App., 332 S.W.2d 335; and Anthony v. State, 166 Tex.Cr.R. 60, 310 S.W.2d 742.

All proceedings appear to be regular, and nothing is presented for review.

The judgment is affirmed.


author: DICE, Commissioner.

text:
    Howard RAY et al., Appellants, v. STATE of Texas, Appellee.
    No. 33298.
    Court of Criminal Appeals of Texas.
    May 31, 1961.

      John J. Fagan, Dallas, for appellants.
    Henry Wade, Crim. Dist. Atty., James M. Williamson, Asst. Dist. Atty., Dallas, and Leon B. Douglas, State’s Atty., Austin, for State.
   DICE, Commissioner.

Appellants Max Rudberg and R. N. Leg-gett were sureties upon the appearance bond of Howard Ray.

The bond, dated September 29,1959 in the principal sum of $500, was conditioned that the principal appear instanter before the County Criminal Court of Dallas County to answer a misdemeanor charge pending against him.

Judgment nisi was entered on December 11, 1959 upon the failure of the principal to appear.

On November 4, 1960, the cause was dismissed as against the appellant surety R. N. Leggett for lack of service of citation and, after a hearing, the judgment was made final against the principal and the appellant surety Max Rudberg for the full amount of the bond.

From such judgment, the appellant sureties bring this appeal.

Appellant R. N. Leggett, not having been served with citation and not having voluntarily appeared in the cause and no judgment having been rendered against him, is in no position to prosecute the appeal. 3 Tex.Jur.2nd 471-472, Appeal and Error—Civil, secs. 199 & 202.

Accordingly, the appeal as to appellant Leggett is dismissed.

Appellant Rudberg predicates the appeal upon three points.

By points numbered one and two, appellant insists that the court erred in admitting in evidence the scire facias because it was at variance with the judgment nisi, and, in admitting in evidence the appearance bond because it was not conditioned as provided by Art. 275a, Vernon’s Ann.C.C.P.

Appellant did not object to the instruments for such reasons when offered in evidence, but urged such objections for the first time in his motion for new trial. The objections not having been timely made are not properly before us for review. 3 Tex.Jur.2nd 390-395, secs. 121-123.

However, an examination of the bond reflects that it contained the requisites prescribed by Art. 273, V.A.C.C.P., and was conditioned that the principal make his personal appearance instanter before the County Criminal Court of Dallas County to answer the charge against him. The fact that the bond did not also bind the principal to appear before the court “for any and all subsequent proceedings had relative to the charge” as provided by Art. 275a, V.A.C. C.P., did not vitiate the bond. Such omission clearly did not make the bond more onerous and would not invalidate the same.

Appellant’s point number three is that the court erred in not exercising his discretion and remitting a part of the sum specified in the bond when it appeared that, prior to the date of entry of final judgment on the bond, the principal had been rearrested at the instance and expense of the sureties and had pleaded guilty to the charge. The record does not show that appellant, prior to rendition of final judgment, filed any pleading requesting the court to exercise his judicial discretion in remitting a part of the bond. While the record reflects that the principal had been tried and convicted of the charge prior to the signing and entry of final judgment, there is no proof that he was re-arrested at the instance and expense of the sureties.

Under the record, we overrule the contention that the court abused his judicial discretion in not granting a remittitur on the bond.

The judgment as to appellant Rudberg is affirmed.

Opinion approved by the Court.


author: DICE,, Commissioner.

text:
    Willie L. SIMS et al., Appellants, v. STATE of Texas, Appellee.
    No. 33299.
    Court of Criminal Appeals of Texas.
    May 31, 1961.
    John J. Fagan, Dallas, for appellants.
    Henry Wade, Crim. Dist. Atty., James M. Williamson, Asst. Dist. Atty., Dallas, and Leon B. Douglas, State’s Atty., Austin, for State.
   DICE,, Commissioner.

This is an appeal by Max Rudberg and R. N. Leggett as sureties upon the appearance bond of Willie L. Sims in the principal sum of $500 from a final judgment of the County Criminal Court of Dallas County forfeiting said bond.

The questions presented are disposed of hy our opinion affirming the judgment in Cause No. 33,298, styled Ray et al., v. State, Tex.Cr.App., 350 S.W.2d 653.

No error appearing herein; the judgment is affirmed.

Opinion approved by the Court.


author: WOODLEY, Presiding Judge.

text:
    Ex parte Melvin Thomas RENFRO and Horace Burt Mullins.
    No. 33605.
    Court of Criminal Appeals of Texas.
    Oct. 2, 1961.

      Jack Love, Fort Worth, for Melvin Thomas Renfro.
    Mackin, Goldsmith & Burdette, Fort Worth, for Burt Horace Mullins.
    Doug Crouch, Dist. Atty., Albert F. Ficlc, Jr., Asst. Dist. Atty., Fort Worth, Leon B. Douglas, State’s Atty., Austin, for the State.
   WOODLEY, Presiding Judge.

This is a habeas corpus proceeding instituted jointly by the relators who were in custody under an Executive Warrant for extradition to Oklahoma. The appeal is from an order remanding them to custody to be delivered to the agents of Oklahoma.

The Executive Warrant recites that it had been made known to the Governor of Texas, by the Governor of the State of Oklahoma, “that Burt Horace Mullins and Melvin Thomas Renfro stand charged by complaint and other papers, before the proper authorities, with the crime of murder while engaged in the commission of a felony committed in said state and that the said defendants have taken refuge in the State of Texas * *

The Executive Warrant orders the rela-tors conveyed “back to said state to be dealt with for said crime” and recites that the Requisition “is accompanied by copy of said complaint and other papers duly certified as authentic by the Governor of said state.”

At the hearing there was introduced in evidence the Executive Warrant issued by the Governor of Texas and, as a composite exhibit, the Requisition of the Governor of Oklahoma; application of the County Attorney of Carter County, Oklahoma, for Requisition; complaint against the relators charging them with murder while engaged in the commission of a felony in Carter County, Oklahoma, on December 22, I960,, sworn to before G. W. Sparger, Justice of the Peace, and separate warrants issued by said Justice of the Peace for the arrest of each of the relators.

Evidence was introduced at the hearing sufficient to sustain a finding that the rela-tors were in Oklahoma at the time and place of the alleged murder; and there was evidence on behalf of the relators which,, if accepted as true, showed that the relators were in Fort Worth, Texas, at the time in question.

Separate briefs have been filed by the relators and separate arguments presented.

Relator Mullins contends that he should be discharged because there is no statement or allegation in writing from the Governor of Oklahoma that he was present in Oklahoma at the time of the offense and thereafter fled from that state. We overrule this contention. Ex parte Emmons, 167 Tex.Cr.R. 544, 322 S.W.2d 534, and Ex parte McComb, Tex.Cr.App., 332 S.W. 2d 575.

He next contends that the application for requisition does not contain the certification that in the opinion of said County Attorney the ends of justice required his. arrest.

The County Attorney, in his application,, states “that the ends of justice require that he be brought back, at public expense, to the-State of Oklahoma for trial.”

Relator Renfro contends that the Executive Warrant of the Governor of Texas is. void and in violation of Secs. 7 and 3 of Art. 1008a, Vernon’s Ann.C.C.P., and that, the Requisition of the Governor of Oklahoma does not comply with Sec. 3 of Art.. 1008a, V.A.C.C.P. We do not agree.

The Executive Warrant together with the Requisition and supporting papers. constituted a sufficient compliance with the statute. It was not essential that the complaint or affidavit sworn to before the Justice of the Peace bear a seal. A Justice of the Peace has no seal. Its absence did not vitiate the complaint. Lopez v. State, 162 Tex.Cr.R. 572, 288 S.W.2d 64.

The question of guilt or innocence is not to be determined in an extradition proceeding. Ex parte Garcia, 167 Tex.Cr. R. 159, 319 S.W.2d 328.

The judgment remanding relators for extradition is affirmed.


author: BELCHER, Commissioner.

text:
    Richard SPRADLIN, Appellant, v. STATE of Texas, Appellee.
    No. 33723.
    Court of Criminal Appeals of Texas.
    Nov. 8, 1961.
    Percy Foreman, Houston, for appellant.
    Leon B. Douglas, State’s Atty., Austin, for the State.
   BELCHER, Commissioner.

The conviction is for driving while intoxicated, on a plea of not guilty before the court without a jury; the punishment, 10 days in jail and a fine of $150.

The state’s witness Brown testified that he saw only one person in a car that passed him at a right rate of speed on a public highway and in a short distance struck the left rear of a car it overtook, and then stopped in a ditch; and that he immediately went to the car in the ditch. At the trial, he identified the appellant as the only person he saw in the car in the ditch, and testified that to get out of the car on the left side a person would have had to go through a window. He further stated that two officers helped appellant from the car, and he expressed the opinion that appellant was intoxicated.

W. A. Davis testified that a car struck the left rear of the car in which he was riding, then passed his car on the left and in about three blocks stopped in a ditch; and that he immediately went to the car in the ditch. While testifying, the witness Davis identified the appellant as the only person in the car stopped in the ditch, and stated that when the car passed him there was only one person in it.

Officer Ashby testified that when he arrived the appellant, with his eyes closed, was slumped over the steering wheel; that he was the only person in the car, and he helped him out after he moved to the right side; and that appellant’s breath was heavy with alcohol, and that he was intoxicated.

Testifying in his own behalf, the appellant said that he was not driving the car but was riding between two companions in the front seat, one of whom was driving. These two companions testified that appellant was not driving, but that one of them was. He called other witnesses whose testimony corroborated his own and that of his companions. But, several of them testified that the appellant was intoxicated.

There are no formal bills of exception m the record, and no brief has been filed by the appellant.

The evidence is sufficient to sustain the conviction, and no error appearing, the judgment is affirmed.

Opinion approved by the Court.


author: McDonald, judge.

text:
    Luther TUCKER, Appellant, v. STATE of Texas, Appellee.
    No. 33923.
    Court of Criminal Appeals of Texas.
    Nov. 8, 1961.
    No attorney for appellant of record on appeal.
    Wayland G. Holt, Dist. Atty., Snyder, and Leon B. Douglas, State’s Atty., Austin, for the State.
   McDonald, judge.

The offense is felony theft; the punishment, two years in the state penitentiary.

No notice of appeal appears in the record in this cause, nor was any valid notice of appeal given in the trial court or entered of record, so as to confer jurisdiction on this court as required by Art. 827, Vernon’s Ann.C.C.P. See Hernandez v. State, Tex. Cr.App., 294 S.W.2d 837; Reid v. State, Tex.Cr.App., 333 S.W.2d 140. In the absence thereof, this court has no jurisdiction of the appeal.

The appeal is dismissed.


text:
    Lois WILSON, Appellant, v. STATE of Texas, Appellee.
    No. 33798.
    Court of Criminal Appeals of Texas.
    Nov. 8, 1961.
    No attorney for appellant of record on appeal.

      Henry Wade, Criminal Dist. Atty., George Milner, Jr., Pat McDowell, Phil Burleson, Asst. Criminal Dist. Attys., Dallas, and Leon B. Douglas, State’s Atty., Austin, for the State.
   MORRISON, Judge.

The offense is driving while intoxicated; the punishment, 30 days in jail and a fine of $200.

The witness Fair testified that as he was driving on the Freeway in the City of Dallas an automobile driven by appellant pulled out in front of him, resulting in a collision.. He stated that he was unable to avoid hitting appellant’s automobile because there was a truck in the other lane of traffic and he could not pull aside. He stated that he .approached appellant’s automobile after the collision and tried to engage her in conversation but that he was unable to make any sense out of what she said and that when the police arrived they carried her “one on each side” to the patrol car.

Officer Smith testified that he arrived upon the scene of the collision, observed appellant’s manner of speaking, her flushed face and eyes, and detected a strong odor of alcohol about her person, asked her if she had been drinking and appellant replied that she had been drinking at home. He stated that it was necessary for him to assist her in going to the patrol car and expressed the opinion that she was intoxicated.

Accident Investigator Speers testified that when he approached appellant’s automobile he detected a strong odor of alcohol about her person, asked her if she had been drinking and was told that she had drunk half of a half-pint of whiskey at home. He stated that her eyes were bloodshot, her' face was flushed and that she was unable to focus her eyes well enough to read a sheet of paper, and expressed the opinion from these factors and his conversation with her that she was very intoxicated.

Appellant, testifying in her own behalf, admitted having had two drinks of whiskey earlier in the afternoon but stated that she was not intoxicated and blamed her inability to walk on the wreck.

The jury resolved the disputed issue of fact against the appellant, and we find the evidence sufficient to support their verdict.

No formal bills of exception appear in the record, and no brief has been filed for appellant.

Finding no reversible error, the judgment of the trial court is affirmed.


author: FANNING, Justice.

text:
    W. H. HOLT, Appellant, v. Alvin FARLEY, Appellee.
    No. 7315.
    Court of Civil Appeals of Texas. Texarkana.
    Oct. 10, 1961.
    Rehearing Denied Oct. 31, 1961.

      William C. Koons, Witts, Geary, Hamilton, Brice & Lewis, Dallas, for appellant.
    Ross Huffmaster, Kaufman, for appellee.
   FANNING, Justice.

This is an appeal from a temporary injunction. The judgment of the trial court is reversed and judgment is here rendered dissolving the temporary injunction.

On October 14, 1959, W. PI. Holt recovered judgment against Alvin Farley in the amount of $1,118.78, in the 68th Judicial District Court of Dallas County, Texas. On November 9, 1959, Farley filed suit against Holt in the 86th Judicial District Court of Kaufman County, Texas, seeking damages in the sum of $1,350, to which suit defendant duly filed an answer; also in this Kaufman County suit Farley sought a temporary injunction to enjoin Holt and the Sheriff of Henderson County, Texas, from levying execution under the Dallas judgment on the property of Farley. On Oct. 10, 1960, the trial court in the Kaufman County District Court granted the temporary injunction prayed for. Holt has appealed from said order.

Farley was duly served with citation in the Dallas District Court suit and the judgment rendered in said suit is valid on its face. The record shows that Farley received notice of the judgment of the 68th District Court of Dallas County, Texas, a few days after its rendition, however he did not file a motion for new trial, nor did he attempt to set aside the judgment, nor did he appeal or seek to appeal in any manner from it, and he has not filed a direct attack against such judgment by Bill of Review. Farley also neither alleged nor proved on the hearing for temporary injunction that he had a meritorious defense to Holt’s suit and judgment. Farley also neither alleged nor proved that Holt was insolvent. By reason of the above matters Farley was not entitled to the temporary injunction. See the following authorities: Duncan v. Smith Brothers Grain Co., Tex.Comm.App., 113 Tex. 555, 260 S.W. 1027; Clayton v. Stephenson, Tex.Civ.App., 254 S.W. 507, wr. ref.; Miller v. Burnet Mercantile Co., Tex.Civ.App., 65 S.W.2d 505; Texas National Bank of Beaumont v. Moore, Tex.Civ.App., 118 S.W.2d 934; 18 Tex.Jur., p. 616; Williamson v. Johnson County, Tex.Civ.App., 241 S.W. 533; Magnolia Petroleum Co. v. McClendon, 123 Tex. 10, 65 S.W.2d 484; Bullitt v. Jesse French Piano and Organ Company, Tex.Civ.App., 158 S.W. 782, wr. ref.

The judgment of the trial court is reversed and judgment is here rendered dissolving the temporary injunction.

Reversed and rendered.


author: RENFRO, Justice.

text:
    KENDALL COMPANY, Appellant, v. PLASTIC ENGINEERING & SALES CORPORATION, Appellee.
    No. 16251.
    Court of Civil Appeals of Texas. Fort Worth.
    Oct. 20, 1961.
    Rehearing Denied Nov. 17, 1961.
    Carrington, Johnson & Stephens, Hubert D. Johnson and Hal M. Bateman, Dallas, for appellant.
    Simon & Simon, and Richard U. Simon, Fort Worth, for appellee.
   RENFRO, Justice.

Appellant, The Kendall Company, was defendant in the trial court, and appellee, Plastic Engineering & Sales Corporation, was plaintiff below. From a $24,000 judgment based on quantum meruit, Kendall appeals.

At all pertinent times defendant was manufacturer of a polyethylene plastic tape known as Polyken, used as a corrosion protective coating over underground pipe lines. Plastic of Fort Worth and Cathodic Protection Service of Houston were distributors for Kendall under Sales Development Distributor Franchise Agreements.

In the late spring of 1959, all three of the above named Companies learned that Old Ocean Fuel Company, a subsidiary of Texas Electric Service Company, planned to construct a gas pipe line from a point near Houston to Graham, Texas.

Plastic, Cathodic and Kendall all started contacts, visits, calls, etc., with Old Ocean Fuel Company in an effort to sell Polyken for the pipe line job. Old Ocean Fuel Company will be referred to as Buyer.

Kendall learned that both Cathodic and Plastic were working to make the sale of Polyken to the Buyer. Generally, Kendall worked with both its distributors but the distributors did not work with each other in their efforts to make the sale to Buyer. After considerable negotiations and preparation the Kendall Company submitted a bid direct to Buyer’s Consulting Engineers on March 2, 1960, which was accepted two weeks later by the Buyer.

In the Franchise Agreement to plaintiff, Kendall reserved the right to make direct sales in special large volume situations. The Franchise provided in such cases Kendall might in its discretion appoint a sales development distributor to act as its agent. In a supplemental letter from Kendall, Plastic was named as special agent and the letter specified rate of commissions to be paid for transactions made in accordance with the published list price. The published list price in the letter to Plastic for the Polyken was $6.33 per unit. In the bid submitted to buyers direct Kendall reduced the price to $5.59 per unit.

The court, being of the opinion Plastic was not entitled to recover under contract as it had plead originally, submitted the case to the jury on its alternate plea of quantum meruit. The jury found the reasonable value of the services rendered by Plastic through its officers and agents in connection with the purchase by buyers of Polyken was $24,000.

Kendall’s first point of error contends the trial court erred in rendering judgment in any amount because of a jury finding that Plastic was not the procuring cause of the purchase order of March 16, 1960, wherein the Buyer had placed an order for Polyken in the amount of $644,258.68 to Kendall Company, “c/o Plastic Engineering & Sales Corporation”.

The foregoing contention is contrary to Kendall’s position prior to, at the time of and following the sale of Polyken to the Buyer and contrary to the position taken by Kendall’s witnesses on the trial of the case.

The witness Shaw, Western Regional Manager of the Polyken Sales Division of the Kendall Company, testified that he knew Plastic was assisting and working up the sale; that in February he called Plastic to get information to be used by Kendall in preparing its bid; that when he learned Kendall was to receive the order he went to the Buyer’s office in company with another Kendall representative, where he was required to wait over an hour until Mr. Hollinger, General Manager of Plastic, arrived. When Hollinger arrived, Buyer handed the purchase order to him. The Buyer had previously informed Shaw he would not deliver the order to anyone except Plastic. Kendall later sent Plastic a check for $12,855.75, which was refused. The check represented 2% of the net billings on the tape involved. In the letter of transmittal J. T. Doyle, General Sales Manager of the Polyken Sales Division of the Kendall Company, stated in part: “You were informed at the time the Old Ocean Fuel Company order was placed that Plastic Engineering & Sales Corporation would receive a payment compensating you in total for your services to the extent to which the facts and our judgment on these facts measured your effective contribution to the total sales development * * * ” and “ * * * this is to inform you of the amount that you will be paid for your contribution.”

Shaw testified that the check above referred to was payment to Plastic for services rendered. Shaw further testified in effect that the reason Plastic’s commission was reduced was because the profits for both parties involved were less than they could have been.

The witness Stineback, Director of Sales of the Chicago Division of the Kendall Company, testified that as of the time of the trial it was Kendall’s position that Plastic was entitled to a commission. He also recognized the contribution Plastic had made.

The witness Doyle testified that Plastic had made contributions to the sales effort; that he told Plastic on the first of February that Kendall was going to bid direct and that commissions would probably not be in excess of 4%.

On the morning of March 2, Shaw told Hollinger of Plastic that Kendall was going to pay a 4% commission and it would be decided later in what proportion a division would be made between the two distributors.

On March 18, after the sales order had been delivered to Polyken via Hollinger, Doyle wrote R. W. Seipel, Purchasing Agent of Buyer: “ * * * we recognize your desire to have Plastic Engineering and Sales Corporation, Ft. Worth, participate in whatever compensation is paid by us for services rendered in connection with the Protective Tape Coating portion of the order, and we intend to make a payment to Pescor (Plastic) which is equitable under all the circumstances.”

The record establishes that Kendall knew for several months that Plastic was endeavoring to make the sale. Kendall accepted the efforts of Plastic and called on Plastic for further services prior to the submission of the bid. Plastic performed all the services requested by Kendall. Kendall at all times, prior to filing answer to the instant suit, acknowledged an obligation to pay Plastic for its services. The only difference between the parties was how much commission Plastic had earned. Kendall’s witnesses acknowledged from the witness stand that Plastic had earned some commission. They did not contend at the trial, as contended on appeal, that Kendall never owed Plastic anything.

In none of the written exhibits or testimony of plaintiff or defendants was there any requirement that Plastic be the procuring cause that brought about the sale of the Polyken. Under all the evidence and the circumstances of this case we think quantum meruit was properly submitted to the jury and judgment entered thereon.

The principle of recovery on quantum meruit is founded upon the rule that it is inequitable for the party to refuse to pay for the benefits he received or for work performed for him with his knowledge and consent by someone who is authorized to expect remuneration therefor. Kramer v. Wilson, Tex.Civ.App., 226 S.W.2d 675.

In view of the record before us, it was not necessary that Plastic be the procuring cause of the sale. Hussman v. Leavell & Sherman, Com.App., 32 S.W.2d 643.

In its second point of error Kendall contends that in no event should Plastic recover more than 2% of the net billings of the Polyken tape because of an express special contract between Kendall and Plastic. Kendall relies upon the following: On the morning of March 2, 1960, Shaw met Hollinger at the Texas Hotel Coffee Shop, told him that due to intense competition Kendall was submitting a direct bid to Buyer of $5.59 per unit and if a sale was made on that basis Kendall would pay the two distributors a total commission of 4% to be divided between them by Kendall; that Hollinger said nothing. On the afternoon of March 2, the bid was delivered by Shaw personally to Buyer’s consulting engineers in Waco, Texas, and, as previously stated, was accepted by the Buyer approximately two weeks later.

The jury on ample evidence found that Plastic did not agree to and acquiesce in such method of compensation as decided upon by Kendall. The total of 4% was not decided upon or agreed upon between the parties but said price was decided upon by Kendall and Plastic was not negotiated with or asked about the amount determined upon by Kendall but was “told” what it would be paid. This, of course, was after the bid had been prepared and nothing further remained to be done by either Kendall or Plastic except delivery of the bid to the consulting engineers for the Buyer.

The parties had no definite agreement, in view of the manner in which the whole matter was handled, as to amount of commissions Plastic would receive.

In a suit on quantum meruit for services rendered the law fixes the measure of recovery, implying a promise to pay the reasonable value of the services. Colbert v. Dallas Joint Stock Land Bank, Com.App., 136 Tex. 268, 150 S.W.2d 771; 7 Tex.Jur., p. 525, sec. 124.

The point of error is overruled.

In view of what we have already said, Plastic’s contention in its counterpoint that it is entitled to recover under the schedule set out in the contract is not tenable.

In its third and last point Kendall contends there was no competent evidence to support the jury finding that $24,000 was the reasonable value of Plastic’s services.

For Plastic, Hollinger, General Manager, and Olson and Campbell, officers and stockholders of Plastic, testified as to the efforts they made in working up the sale of Poly-ken to the Buyer. There was evidence that Buyer was a strong believer in dealing with local people and the consulting engineer for Buyer testified that the fact Plastic was a Fort Worth concern certainly entered the picture.

The witness Seipel, Purchasing Agent for Buyer, testified it was a policy of the Buyer to place orders through local distributors, that he furnished his Company’s consulting engineers with Plastic’s name so it would receive an invitation to bid. He testified he would not deliver the purchase order made out to Kendall, c/o Plastic Engineering & Sales Corporation, to Kendall but had Kendall’s representatives wait in his office until Hollinger arrived and then delivered the order to Hollinger.

The witness McIntosh of Cathodic testified the 2% commission paid by Kendall was not fair. Other testimony gave a reasonable commission as anywhere from $6,000 to the $53,281.21 figure that Hollinger testified would be a reasonable commission, in the sale of the volume involved.

In view of the size of the transaction, the testimony as to the activities of Plastic, the testimony concerning the policy of Buyer to deal with local distributors and its insistence that Plastic’s name be on the order and that it be personally delivered to Plastic, and in view of the record as a whole, we hold that the evidence was sufficient to uphold the jury finding on reasonable value.

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


author: STEPHENSON, Justice.

text:
    Alfonse MARTIN, Appellant, v. COMMERCIAL STANDARD INSURANCE COMPANY, Appellee.
    No. 6497.
    Court of Civil Appeals of Texas. Beaumont.
    Oct. 26, 1961.
    Rehearing Denied Nov. 15, 1961.

      Ernest Sample, Beaumont, for appellant.
    Keith, Mehaffy, McNicholas & Weber, Beaumont, for appellee.
   STEPHENSON, Justice.

This suit was brought by Alfonse Martin, appellant, against J. C. Dishman, G. A. Dishman and H. E. Dishman, d/b/a Dish-man Brothers, appellees, for personal injuries sustained when appellant fell or was thrown from a tractor. Appellant was employed as a farm laborer by appellees and received an injury while engaged in his usual work. The trial court instructed a verdict for appellees at the close of appellant’s evidence.

Appellees contended in the trial court and again in this court: that appellant did not establish the fact that the accident was caused by a defect in the tractor; that there was no duty on the part of appellees, as a matter of law, to inspect the tractor under the circumstances of this case. After careful consideration of the record, we are of the opinion the evidence was sufficient to raise ultimate issues which should have been submitted to the jury.

It is appellant’s theory of the case that the accident was caused because of a defect in the hydraulic system of the tractor, permitting the slip, or blade attached to the tractor to bounce up and down and sink into the ground causing appellant to be thrown from the tractor. The testimony of appellant shows that he was employed by appellees to work on their farm, and among other duties, to drive a tractor. On the occasion in question he was driving the tractor furnished to him by appellees. When he reached some rough ground, all at once the tractor began acting up with him, and began bouncing more and more, and pulled off of the ground and threw him off at which time he sustained the injuries complained of. Appellant testified he saw a goitged out place in the ground about six feet from where he fell in the same line he had been traveling. That after he was thrown from the tractor, it continued across the field, gashing the levee and picking up a slip of dirt. The tractor crossed about twenty levees. Extensive repairs had to be made to the tractor following the accident. Among other items, a leak in the hydraulic system was repaired. An expert witness, called by appellant, testified: that the hydraulic system of the tractor was designed to keep the slip at a uniform height with reference to the rear wheels; that if a leak occurred in the hydraulic system, the system would become soft and spongy, and the slip would bounce up and down.

While the naked fact that an accident has happened may be no evidence of negligence, yet the character of the accident, and the circumstances in proof attending it, may be such as to lead reasonably to the belief that without negligence it would not have occurred. Washington v. Missouri, K. & T. Ry. Co., 90 Tex. 314, 38 S.W. 764. This rule of law is discussed fully in Bolstad v. Egleson, Tex.Civ.App., 326 S.W.2d 506, 517: “Defendant says its motion for an instructed verdict should have been granted because the evidence shows no more than the occurrence of an accident which of course raises no presumption of negligence on the part of anyone * * * (citing cases). These cases correctly state the law, but we do not consider them applicable to the facts of this case. Negligence, like any other ultimate fact, may be established by circumstantial evidence. * * * The true rule in negligence cases, as we apprehend the [rule] to be, is that where the circumstances are such that reasonable minds may logically draw either an inference of actionable negligence or the absence of it, the issue is one of fact for the jury and not one of law for the Court.” The facts established by appellant, mentioned above, the way the tractor acted, bouncing up and down and sinking into the ground, the gouged out place behind the tractor, the leak found in the hydraulic system following the accident and the testimony of the expert in reference to the hydraulic system, all raised an issue to be submitted to the jury as to-whether tire accident was caused by a defect in such system. As it is said in Burlington-Rock Island Ry. Co. v. Ellison, 140 Tex. 353, 360, 167 S.W.2d 723: “The plaintiff was not required to exclude the probability that the accident might have occurred in some other way. To so hold would impose upon her the burden of establishing her case beyond a reasonable doubt. She was only required to convince the jury by fair preponderance of the evidence that the accident resulted from the negligence of the defendant.”

Appellee also contends: there was no breach of duty on their part, established by the appellant; that the tractor had been purchased new less than two months before the time of the accident, and there was nothing to put appellees on notice that the tractor should be inspected for the purpose of ascertaining any defect. In the case of Sternenberg v. Marshall, Tex.Civ.App., 257 S.W.2d 312, 316, it is written: “‘There is no rule of law that imposes upon the master the duty to discover latent defects, where there is nothing to' indicate that any such defect exists * * It is also the law that the master has a nondelegable duty to use reasonable care in-furnishing a servant with tools in such condition that he will not be endangered by ordinarily careful operation and use of them and the master must likewise exercise reasonable care in maintaining such tools in such condition. * * * The diligence which will amount to ordinary care must be measured by the circumstances of the case. * * * Insofar as this point relates to the equality of opportunity which Marshall had with appellant to know the true condition of the burner it has been held that where, as here, the defective condition is hidden and unknown both to the master and servant the servant has not assumed the risk incident to the performance of his duties with the defective tool or appliance since it is the duty of the master to make inspections.” Citing Peck v. Peck, 99 Tex. 10, 87 S.W. 248.

It is true the tractor was less than two months old, and had given no previous indication of being defective. Yet, the appellant proved the appellee J. C. Dishman had an owner’s manual in his possession, furnished him by Oil City Tractor, Inc., the company from whom this tractor was purchased, and that he was familiar with that portion of the manual in reference to the 50 hour inspection. This manual contained the following:

(1) "Fifty hour inspection — after you have operated your tractor for a period of fifty hours, see your Ford Tractor and Implement Dealer. At this time he will perform the factory recommended fifty hour inspection without charge, except for lubricants.
(2) “Hydraulic system — after the first fifty hours and after every six hundred hours operation, change the oil in the hydraulic system.

(3) “After fifty hours of operation — after fifty hours of operation see your Ford Tractor and Implement Dealer. He will perform all necessary checks and adjustments in the fifty hour service and inspection, authorized by your service policy.” Johnny Walker, of Oil City Tractor, Inc., testified: “There was a fifty hour check that the factory recommends, in which we check the hydraulic to see if it has control, and also recommend that the oil be changed in the hydraulic, at the customer’s expense.” The expert witness called by appellant testified the purpose of the inspection of the hydraulic system at the end of fifty hours of operation was to see if there was any leakage or see if it was operating properly, and if there was any loose shavings that would probably drain out with the oil, and to tighten up all loose bolts and screws. This witness also testified that if the parts are loose the proper amount of pressure would not exist, and if shavings got in the oil the valve would wear down and the fluid would by-pass. The appellant testified he had driven the tractor about 100 hours. Appellees brought out the fact that the owner’s manual defined engine hours as the number of hours worked based on an average engine speed of 1,515 revolutions per minute, and that engine speeds below 1,515 r. p. m. accumulates more slowly than clock hours, and those above 1,515 r. p. m. accumulate more rapidly. We think all of this testimony raised an issue which should have been submitted to the jury to determine whether appellees as ordinary prudent persons under these circumstances would have had the tractor inspected before the accident, together with a proper issue on proximate cause.

We are of the opinion this case is controlled by Gammage v. Gamer Co., Comm, of Appeals, 209 S.W. 389, 390, in which it is written as follows:

“It was defendant’s duty to use ordinary care to furnish the plaintiff with safe machinery with which to do his work, and to use the same degree of care to keep it in a reasonably safe condition. In discharging this duty it was incumbent on the defendant to make such inspections of the machine and use such precaution in the matter of keeping it oiled and in good running condition, as the nature of the machine indicated to be proper. * * * Where the evidence, as in this case raises the question as to whether the machine was ever inspected, or more than casually observed from time to time by the defendant, the question of whether the defect had existed for a sufficient length of time to be discovered upon a proper inspection does not arise, and in such cases it is a question for the jury as to whether the defendant is free from negligence. * * * The evidence as a whole raised the issues of whether the machine was defective, and whether, if the defendant had used reasonable diligence to inspect the machine or ordinary care to keep it in good running condition, the plaintiff would have been injured. These issues were for the jury, and, together with other, were submitted under a proper general charge. The verdict was for the plaintiff and is supported by evidence.”

It is ordered the judgment of the trial court be reversed and the cause remanded for trial.


text:
    Tony L. KOTT et al., Appellants, v. Edward FAIRCLOTH et al., Appellees.
    No. 6492.
    Court of Civil Appeals of Texas. Beaumont.
    Oct. 26, 1961.
    C. B. Stanley, Houston, for appellants.
    Joe J. Newman, Houston, for appellees.
   STEPHENSON, Justice.

This is an appeal by Geraldine Young, a feme sole, from an order of the trial court overruling her plea of privilege to be sued in Harris County, the county of her residence. Plaintiffs brought suit against several defendants alleging Geraldine Young and T. L. Kott were acting as partners in the transaction made the basis of this suit. The defendants filed separate pleas of privilege, all of which were overruled, and this was the only appeal taken. The parties will be designated here as they were in the trial court.

J. V. Stepchinski and Ed Stepchinski, also named as defendants, acting on behalf of the partnership composed of Geraldine Young and T. L. Kott, purchased cattle in Liberty County from plaintiffs. There were many separate purchases, but in the four made the basis of this action, checks were given which were not honored. None of the defendants were residents of Liberty County.

Plaintiffs relied upon sections seven and nine of Art. 1995, Texas Revised Civil Statutes, to retain venue in Liberty County. The fraud relied upon by the plaintiffs was the representation by T. L. Kott that previous checks had been paid before the last check, made the basis of their suit, was accepted and the cattle delivered.

The suit here is clearly one for breach of contract in failing to pay the balance due for the purchase of the cattle. The allegations of fraud and crime are merely incidental to the cause of action for this breach of contract. The plaintiffs accepted several payments upon the indebtedness after the last transaction sued upon. In their prayer, plaintiffs seek recovery of the unpaid balance due for such cattle. The representations on the part of T. L. Kott were at most, fraud in inducement to secure the purchase of the cattle. The law in this state is well settled that in a suit for damages for breach of contract, venue cannot be sustained in the county where fraud in inducing the execution of the contract is alleged to have occurred. Henson v. Henson, Tex.Civ.App., 181 S.W.2d 285; Lewis v. Evans, Tex.Civ.App., 332 S.W.2d 795.

Our courts have repeatedly held that the dominant purpose of the venue statutes is to give a person who has been sued the right to defend such suit in the county of his domicile, except under well defined exceptions. Meredith v. McClendon, 130 Tex. 527, 111 S.W.2d 1062.

The plaintiffs cite only the case of Stedman v. International Harvester Co., Tex.Civ.App., 319 S.W.2d 791, to sustain the trial court’s decision to retain venue in Liberty County. In the Stedman case no controverting affidavit was filed by the plaintiff who agreed to the transfer of the case. The only question in the Stedman case was whether all or just a part of the case should be transferred. We feel the Stedman case has no application to this case. The fact the other defendants may have waived their pleas of privilege would not confer venue on Geraldine Young in Liberty County. Rogers v. Fort Worth Poultry & Egg Co., Tex.Civ.App., 185 S.W.2d 165. The fact that Geraldine Young and T. L. Kott may have been partners does not control this question. The Commission of Appeals, in Comer v. Brown, Tex.Com. App., 285 S.W. 307, long ago settled the question that causes of action against partners are severable.

The judgment of the trial court is reversed and we order the portion of the case against Geraldine Young transferred to Harris County.


author: COLLINGS, Justice.

text:
    Cora DAVIS, Appellant, v. Tom STAMEY, Appellee.
    No. 3646.
    Court of Civil Appeals of Texas. Eastland.
    Oct. 20, 1961.
    Rehearing Denied Nov. 17, 1961.

      Don H. Russell, Eastland, for appellant.
    Grady Owen, Fort Worth, for appellee.
   COLLINGS, Justice.

Tom Stamey brought suit against Cora Davis, a widow, to recover $4,384.74, the amount alleged to be due on a promissory note executed by the defendant and for foreclosure of a mechanic’s lien contract. Mrs. Davis made defenses of conditional delivery, payment and partial failure of consideration. She filed a cross action for breach of a building contract, of which the note and mechanic’s lien were a part. Plaintiff Stamey admitted payments of the amounts claimed by defendant but alleged he had applied them first to extra work done under the contract. The trial was before a jury which found (1) that plaintiff and defendant agreed to certain alterations and changes from the plans and specifications originally agreed upon, (2) that the reasonable cost of said alterations and changes was $4,373.74, (3) that Stamey did not fail to complete the house in accordance with the plans and specifications agreed upon, and (6) that Stamey did not fail to complete the house in a good and workmanlike manner. Based upon the verdict, judgment was rendered on the note for plaintiff in the sum of $4,373.74, with interest and attorney’s fees, and for foreclosure of the mechanic’s lien, and that the defendant take nothing by her cross action. Mrs. Davis has appealed.

Appellant presents points of error urging (1) that the court erred in overruling her motion for judgment non obstante veredicto because the undisputed facts and the law applicable to payment established her defense of payment, (2) that the court erred in rendering judgment upon the finding that appellee had done extra work of a reasonable cost of $4,373.74, and in refusing appellant’s motion for a new trial, be-case such finding and the judgment based thereon are contrary to the evidence, (3) that the court erred in rendering a take nothing judgment on appellant’s cross action and in overruling appellant’s motion for a new trial because the verdict in response to special issues numbers 3 and 6 are not supported by, but are contrary to the evidence, and (4) that the court erred in overruling appellant’s motion for new trial because the verdict in response to special issues numbers 2, 3 and 6 are against the great weight and preponderance of the evidence.

The evidence shows that Stamey, as contractor, and appellant, as owner, entered into a written building contract on August 26, 1959, and that in connection therewith appellant executed the mechanic’s lien note here sued upon. By the terms of the contract appellee agreed to furnish all labor and materials and to construct the house in a good and workmanlike manner according to plans and specifications. He agreed to complete the job within 97 days, or on December 1st, 1959, and in consideration thereof, appellant obligated herself to pay the sum of $14,000.00, according to the terms of the promissory note.

Appellee, soon after the date of the contract, began construction of the building. At various times during construction ap-pellee, at the direction of appellant, made alterations and additions to the original plans and specifications which increased the cost of the construction job to $18,373.74. Because of the changes and additions, the job was not completed on December 1st, 1959, as originally called for but was completed on January 29, 1960. On December 1st, 1959, Stamey informed appellant that he needed money to pay for extra material and labor and asked her to pay him the sum of $7,000.00. Thereafter, on December 7th, 1959, appellant made such payment. Appellant made another payment to Stamey on January 11, 1960, in the sum of $5,000.00 and a third payment on March 1st, 1960, in the sum of $2,000.00. Stamey applied the payments first to extras and then applied the balance on the note. This left a balance due on the note of $4,373.74.

The suit against appellant was to recover the balance alleged to be due upon a $14,000 materialman’s lien note and to foreclose the lien. Appellant plead payment as a defense. Appellant therefore, had the burden to prove she had paid the note. 70 C.J.S. Payment § 93, pages 298-299; Commercial Inv. Trust vs. Smart, 123 Tex. 180, 67 S.W.2d 858, 69 S.W.2d 35. Appellant contends she has met the burden; that the undisputed facts and the law applicable thereto establish that she paid the note in full. No issue was submitted to the jury on the question of payment. Appellant does not contend that there was a finding of payment supported by evidence. Pier contention is that the undisputed facts show payment as a matter of law. We cannot agree with this contention.

It is undisputed that appellant paid to appellee the sum of $14,000. But the question of whether the note was paid in full is not undisputed. There is a controversy concerning the application of the payments. Stamey applied the payments made by the appellee first to the extras and then applied the balance on the note. Appellant contends that this was an improper application of her payments. The burden was upon appellant to establish that such application of the payments was improper, 70 C.J.S. Payment § 97, page 303. Appellant has failed to meet the burden of showing that the application of her payment to extras first was improper. She has failed to establish her defense of payment of the note sued upon.

In 32 Tex.Jur. 673-675, the law applicable to payments is generally stated as follows :

“That an agreement by the parties as to the indebtedness to which particular payments are to be applied is controlling. * * * In the absence of any agreement on the subj ect, the common law rule as to the application of payments prevails. Ordinarily, in such circumstances, the debtor may direct how payments made by him shall be applied. If he had failed to exercise this right, the creditor may appropriate the payment to such debts due him by the debtor as he chooses. When no application is made by either party, the law will make the appropriation according to the justice and equity of the case.”

Contrary to appellant’s contention, there was evidence to the effect that it was agreed that the $7,000 payment was to be applied first to extras. Stamey testified that he told appellant he needed money to pay for extra material and labor and that she paid him $7,000. Previous testimony by Stamey, inconsistent therewith, was not conclusive but merely presented an issue of fact for determination by the jury.

Appellant contends that the $7,000 payment on December 7, 1959 must, by law, be applied on the note because the debt for extras was not then due. She points out that by the terms of the contract, her duty to pay was contingent upon performance by appellee; that under the contract, as amended by parol, the debt was not due until appellee had substantially performed, “which could not be before January 29, 1961”, and that the unliquidated part of the debt for extras could not be due until liquidated, “which could not be before the 1st day of February 1961.” There is a presumption, in the absence of an agreement, that a payment is intended to be applied to a matured debt rather than to an un-matur-ed debt. Here however, there is evidence of an agreement to apply the payment to the cost of extras. Under these circumstances payment of the note is not conclusively shown but an issue of fact is presented, 70 C.J.S. Payment § 93b, page 301. There is no finding of payment. On the contrary it is presumed in support of the judgment that the court found the note was not paid in full; that it was agreed that the $7,000 payment should be applied first to extras and the balance to the note, and that such an application by Stamey was proper.

There was ample evidence that Stamey did extra work of a reasonable cost of $4,-373.74. We overrule appellants point urging that the jury finding to that effect and the judgment based thereon are contrary to the evidence. There was also ample evidence supporting the findings that Stamey did not fail to complete the house in accordance with the plans and specifications agreed upon, and that he did not fail to complete the house in a good and workmanlike manner. Such findings were not, as appellant contends, against the great weight and preponderance of the evidence. Appellant’s points so urging are overruled.

The judgment is affirmed.


author: CLAY, Commissioner.

text:
    COMMONWEALTH of Kentucky DEPARTMENT OF HIGHWAYS, Appellant, v. Isaac Bethel UTLEY et al., Appellees.
    Court of Appeals of Kentucky.
    June 16, 1961.
    Rehearing Denied Dec. 1, 1961.
    John B. Breckinridge, Atty. Gen., H. D. Reed, Jr., Asst. Atty. Gen., C. E. Skidmore,. Frankfort, for appellant.
    Dorsey & Sullivan, Leonard T. Mitchell,. M. S. Mahurin, Henderson, for appellees.
   CLAY, Commissioner.

This is a condemnation suit brought on-behalf of the Department of Highways against the owners of certain property and others interested therein, including lessees. The Commonwealth undertook to appeal' from the county court judgment on the-ground that the damages awarded were excessive. The circuit court dismissed the appeal on several grounds set forth in “Answers” filed by the defendants to the Commonwealth’s “Statement of Appeal”. (The practice in this case was rather unusual.j

Defendants’ attack on the Commonwealth’s appeal from the county court to-the circuit court involves procedural' matters. We will outline the proceedings- and then dispose of the issues raised.

On July 27, 1959, the Henderson County Court entered a judgment finding the proper parties before the court, determining the Commonwealth was entitled to condemn, confirming the award of the Commissioners-in the amount of $34,200, and adjudging the Commonwealth could take possession of the land and materials involved upon payment of the award “to the defendants or to the clerk of this court”. On July 31, the county court entered an “amended” judgment affecting only paragraph (4) of the earlier one, simply providing the manner in which the sum of $34,200 should he divided among the defendants as their interests appeared.

Within 30 days thereafter the Commonwealth, under KRS 177.087, took an appeal on the ground that “the award is excessive”. The Statement of Appeal referred only to the judgment of July 27 and it was not signed by an attorney for the Commonwealth. Subsequently the Statement was signed, and in September the Commonwealth moved to amend its Statement of Appeal to include the amended judgment of July 31.

We will take up the grounds of attack upon this attempted appeal as set forth in defendants’ brief because they admit that some of the grounds originally asserted are not valid. (We confirm this.)

It is first contended the Commonwealth’s Statement of Appeal did not state a claim upon which relief could be granted. KRS 177.087(1) does not require the statement of a claim. This statute prescribes very simple appeal procedure and the method is mostly a matter of mechanics. The appeal is taken by filing a certified copy of the judgment, a statement of the parties to the appeal, and exceptions to the award made by the Commissioners. Commonwealth ex rel. Curlin v. Taylor, Ky., 279 S.W.2d 813. All of these steps were properly taken by the Commonwealth.

Defendants take the position that "because the Commonwealth did not “except” ■specifically to each item in the Commissioners’ Report (which provided for the division of the total award of $34,200 between the owners and the lessees), no appeal was taken as to any defendant. We cannot grasp this argument. The total award of the Commissioners included all of its parts. The exception to the award on the ground it was excessive adequately identified the issue on appeal as to all of the defendants.

Defendants’ next contention is that the Statement of Appeal was not signed by an attorney. The parties assume this is a “pleading” governed by the Rules of Civil Procedure, particularly CR 11. This paper may properly, for certain purposes, be characterized as a pleading. (It may be considered as such for the purpose of showing a jurisdictional amount, or, as specifically provided in KRS 177.087(1), for the purpose of amendment.)

While some of the objectives of CR 11 do not apply to such a procedural paper as this instrument of appeal it properly should be signed in accordance with that Rule. However, failure to sign a pleading is not ground for dismissal. Bareco Oil Company v. Alexander, D.C., 33 F.Supp. 32. The Rule itself provides the manner of attacking such a deficient pleading, which is to have it stricken as sham and false. This, of course, would require a motion. In any event, this paper was subsequently signed by an attorney for the Commonwealth, curing its deficiency. Defendants’ contention on this point is wholly lacking in merit. (We note in passing that counsel for the defendant owners inadvertently failed to sign one of the briefs filed in this Court.)

The next ground of dismissal is that the Commonwealth should have appealed from the amended judgment of July 31 instead of the original judgment of July 27. The judgment of July 27 is the one that finally adjudicated the rights and obligations of the Commonwealth. The July 31 order was supplementary and simply provided for the manner of distribution of the award in the event the Commonwealth exercised its option to take possession by paying into court the full amount thereof. No issue on appeal in any way involved the supplementary order. As a matter of fact, the Commonwealth had no ground upon which to appeal from that order.

The July 27 judgment fixed the amount of the condemnation award. Since the only ground of appeal was that the award was excessive, the Commonwealth properly appealed from the only judgment which determined it. The amended judgment stands or falls upon the results of a trial in the circuit court on the issue of exces-siveness.

In our opinion the Commonwealth is entitled to such a trial, and it was error to dismiss the appeal.

The judgment is reversed for consistent proceedings.

PALMORE, Judge, not sitting.

      . In Commonwealth v. Mayo, Ky., 324 S.W.2d 802, 803, we recognized that “grounds of appeal” are adequate in lieu of “exceptions”.


text:
    COMMONWEALTH of Kentucky DEPARTMENT OF HIGHWAYS, Appellant, v. Ethel HUNT, Widow, et al. Appellees.
    Court of Appeals of Kentucky.
    June 16, 1961.
    Rehearing Denied Dec. 1, 1961.
    John B. Breckinridge, Atty. Gen., H. D. Reed, Jr, Asst. Atty. Gen, C. E. Skidmore, Legal Section, Dept, of Highways, Frankfort, for appellant.
    King, Deep & Branaman, Dorsey & Sullivan, Odie Duncan, Henderson, for appel-lees.
   CLAY, Commissioner.

This is an appeal by the Commonwealth in a condemnation case from an order of the circuit court dismissing its appeal from-a county court judgment which confirmed a Commissioners’ award of $44,000. In all pertinent respects the procedural questions involved are identical with those in the case of Commonwealth of Kentucky v. Utley, Ky, 350 S.W.2d 698. For the reasons stated in that opinion, the circuit court erroneously dismissed the Commonwealth’s appeal and it is entitled to a trial under the provisions of KRS 177.087.

The judgment is reversed for consistent proceedings.

PALMORE, Judge, not sitting.


author: PALMORE, Judge.

text:
    CUMBERLAND RIVER OIL COMPANY, Appellant, v. COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, et al., Appellees.
    Court of Appeals of Kentucky.
    Sept. 22, 1961.
    Rehearing Denied Dec. 1, 1961.

      John G. Prather, Somerset, for appellant.
    John B. Breckinridge, Atty. Gen., H. D. Reed, Asst. Atty. Gen., James J. Shannon, Jr., Atty., Dept, of Highways, Frankfort, for appellees.
    Gladstone Wesley, Somerset, for Mutual Fed. Saving's & Loan Assn.
   PALMORE, Judge.

In this proceeding the Department of Highways has acquired by condemnation a parcel of real estate owned by Jerry Crabb and wife, Violet, on which they operated a garage, service station and restaurant. The appellant, Cumberland River Oil Company, intervened and claimed compensation for damages occasioned by the loss of a contract under which Crabb had agreed to buy from it all of his requirements for petroleum products. All parties appealed from a total, unapportioned award of $30,-000 made by the county court. In circuit court the Crabbs agreed with the Commonwealth that its payment of $30,000 to the county clerk satisfied their claim in full, whereupon the litigation in that court was ended by a summary judgment dismissing Cumberland’s claim on the ground that it did not have a compensable interest in the property taken. Cumberland appeals.

The contract mentioned was executed on August 20, 1955, and ran for a period of three years “and from year to year thereafter until either party notifies the other in writing 30 days before the end of any contract year of his intention to cancel,” etc. It related specifically to the property that is the subject of this litigation, and referred to no other location. In it Cumberland agreed to install and maintain on the property all gasoline, diesel oil and kerosene dispensing equipment, and an air compressor, car hoist and lights, and to sell and deliver, at current market prices, all petroleum products required by the Crabbs. The agreement was fully performed by both parties until halted by the condemnation in May of 1958 and was, according to Cumberland’s pleadings, worth $400 per month to it in the form of net profits. It claimed $10,000 for loss of future profits and $2,500 for expenses and loss in moving its equipment.

At once we meet the question of whether Folger v. Com., Ky.1959, 330 S.W.2d 106, applies to this situation and, if so, whether it is sound law; if not, now is the time for us to say so.

In the Folger case, which has been decided on second appeal by an opinion handed down today, Folger v. Com., Ky., 350 S.W.2d 703, the sellers of a service station, in consideration of a $5,000 credit against the purchase price of the property, caused to be inserted in the deed an agreement that during the term of 15 years thereafter the grantee and his successors in interest would not handle for sale any petroleum products (and certain other related merchandise) except those distributed by the sellers and their successors in business. Some 10 years later the state purchased the service station property for highway purposes and discontinued its commercial use. Folger and Mathias, who had succeeded to the distributorship business of the original sellers, then sued the state claiming that their interest under the agreement was compensable and had been destroyed by the public acquisition. Accepting the principle that for purposes of eminent domain a contractual right relating to particular real property amounts to an interest in the land if it is enforceable against the promisor’s successor in title and is compensable if it is not so remote as to be incapable of evaluation, we held on the first appeal that Folger and Mathias were entitled to recover.

After a careful re-examination of the foregoing conclusion we are of the opinion that even if it be conceded that the obligation created by such a contract follows the title into the hands of a purchaser of the property and represents an evaluable fragment of the market value of the whole, it does not follow that in either of these two cases the owners of the contract rights would be entitled to recover of the state, for not only must the rights be of a com-pensable nature, but they must also be taken or destroyed, and w.e have concluded that in neither case has the state disturbed these rights. On the contrary, it acquired only the title of the fee owner, and if this title was burdened the state took it subject to the restriction. It made no attempt to acquire or extinguish the outstanding contract rights.

There are two schools of thought as to the nature of the title acquired by a condemnation proceeding. One is that it is “an original and independent title, free of all the infirmities and encumbrances which existed at the time it was in private ownership.” Nichols on Eminent Domain, Vol. 1, § 1.142, Vol. 3, § 9.01. The other is that it is “derivative, standing in place of the title as it was privately held, and clear, therefore, only insofar as the private owners have had their interests removed.” Id. Under our Constitution, §§ 13, 242, prohibiting the taking of any person’s interest without his being first paid just compensation, we are bound to the latter of these theories. Indeed, as between the two this is the rule more in keeping with the rights of the individual as opposed to the power of the state, for under it we cannot touch his interest without making him a party to the suit and securing to him a just compention.

Now, in the Folger case there was no condemnation proceeding at all. Still assuming, for purposes of this discussion,, that the obligation followed the title, the state acquired the fee subject to the contract. Had it deferred the building of a highway and caused a service station business to be conducted on the premises for the time being, perhaps Folger and Mathias could have had redress for any violation of the contract. But at the very least the state had the same right to quit the business that its predecessor in title had, and it neither took, violated nor destroyed the contract by so doing.

Since, therefore, Folger and Mathias had no cause for recovery in either event, it was unnecessary to determine whether their contract rights ran with the land or were otherwise of a compensable nature. Pursuant to this view of the subject, Folger v. Com., Ky.1959, 330 S.W.2d 106, is overruled.

In the instant litigation the state does not seek to acquire the contract rights of the Cumberland River Oil Company, nor has it done or proposed to do anything that could not lawfully and properly have been done by the persons from whom its title derives. Hence under no theory could Cumberland have a claim against it.

Judgment affirmed.

BIRD, C. J., dissents.


text:
    W. E. FOLGER & Curtis Mathias, d/b/a Mathias & Foiger Oil Company, Appellant, v. COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellees.
    Court of Appeals of Kentucky.
    Sept. 22, 1961.
    Rehearing Denied Dee. 1, 1961.
    Pat Rankin, Stanford, for appellant.
    John B. Breckinridge, Atty. Gen., H. D. Reed, Asst. Atty. Gen., F. D. Curry, Asst. Atty. Gen., Leslie D. Aberson, Atty. Dept, of Highways, Frankfort, for appellee.
   PALMORE, Judge.

In Foiger v. Commonwealth, Ky.1959, 330 S.W.2d 106, reversing a circuit court judgment to the contrary, we held that the appellants, Folg'er and Mathias, had such an interest pertaining to certain property acquired by the state that they were entitled to compensation for its destruction. The case was remanded for further proceedings. After receiving the evidence thereupon introduced, followed by a verdict awarding appellants $4,000, the trial court sustained the state’s motion for judgment n. o. v. and again gave judgment against the appellants, this time on the ground that their rights remained untaken, unviolated and undestroyed. Hence this second appeal.

A .re-examination of our first opinion in this case has convinced us that we were wrong in holding the appellants entitled to recover. See Cumberland River Oil Company v. Commonwealth, Ky.1961, 350 S.W.2d 700, decided today. As to the law of the case, it falls within the qualification stated in Union Light, Heat & Power Co. v. Blackwell’s Adm’r, Ky.1956, 291 S.W.2d 539.

Judgment affirmed.

BIRD, C. J., dissenting.