author: STEAKLEY, Justice. CALVERT, Chief Justice

text:
    The STATE of Texas et al., Petitioners, v. CONNECTICUT GENERAL LIFE INSURANCE COMPANY, Respondent.
    No. A-9917.
    Supreme Court of Texas.
    July 15, 1964.
    Rehearing Denied Oet. 28,1964.
    Waggoner Carr, Atty. Gen., Austin, H. Grady Chandler and W. E. Allen, Asst. Attys. Gen., for petitioners.
    Clark, Thomas, Harris, Denius & Winters, Conrad Werkenthin and Mary Joe Carroll, Austin, for respondent.
   STEAKLEY, Justice.

With legislative permission, Connecticut General Life Insurance Company, Respondent, instituted this suit to recover overpay-ments to the State of occupation taxes totaling $408,661.26 for the years 1952 through 1957, and for the year 1959. The judgment of the trial court for Respondent was affirmed by the Court of Civil Appeals. State v. Connecticut General Life Insurance Co., 372 S.W.2d 352. Petitioners are the Attorney General, the State Treasurer, the Commissioner of Insurance, and the members of the State Board of Insurance.

Article 4769, Vernon’s Annotated Texas Statutes \ requires insurance organizations to file an annual statement of its gross premiums during the preceding calendar year from persons residing or domiciled in. Texas. It imposes thereon a maximum tax of 3.3 per cent which is reduced on a sliding scale to a minimum of 1.925 per cent, depending on the ratio of investments of the company in Texas securities to investments in similar securities in the state in which the company has invested the highest percentage of its admitted assets. The report is required to be filed on or before the first day of March of each year. The Board of Insurance Commissioners is required to certify to the State Treasurer “the amount of taxes due * * * which shall be paid * * * on or before the fifteenth day of March, following.”

Respondent timely filed the annual reports and sworn statements required by Article 4769 for the years in question, 1952 through 1957, and 1959. In each instance the Board of Insurance Commissioners certified to the State Treasurer that Respondent owed for each year the amount in taxes shown on the annual reports. The remittances of Respondent in such amounts for each year were also delivered by the Board to the State Treasurer. These remittances by Respondent of the amounts certified by the Board were prerequisite to the right of Respondent to the issuance of a permit to continue its business in Texas. Article 4.05 of the Insurance Code, Vol. 14, V.A.T.S., provides, in part:

“Upon the receipt of sworn statements showing the gross receipts of any insurance organization, the Board of Insurance Commissioners shall certify to the State Treasurer the amount of taxes due by such insurance organization for the preceding year, which taxes shall be paid to the State Treasurer for the use of the State, by such company. Upon his receipt of such certificate and the payment of such tax, the Treasurer shall execute a receipt therefor, which receipt shall be evidence of the payment of such taxes. No such life insurance company shall receive a certificate of authority to do business in this State until such taxes are paid. (Italics added.)

In its reports for the years in question, Respondent did not list its Texas securities and its similar securities in the state of its highest investment of assets, but merely stated the ratio to be less than 75% for the years 1952-57; the rate of tax according to the face of these reports was therefore 3.3 per cent for these years. A rate of 2.2 per cent was shown for the year 1959. The Court of Civil Appeals determined upon the basis of the stipulations of the parties quoted in its opinion that Respondent was entitled to a rate of 1.925 per cent for each year in question. This resulted from the affirmative findings of alternative stipulations 15 and 17 by the trial court; the finding as to stipulation 17 was not brought under attack in the appeal and the Court of Civil Appeals properly declared the law applicable to stipulation 15. The overpayments which follow from this determination constitute the amount of the judgment of the trial court which was affirmed by the Court of Civil Appeals, both of which judgments are, in turn, affirmed.

The problem of the recovery of taxes which a taxpayer has paid but which he does not owe has confronted the courts under many circumstances and with varied results. See the annotations in 64 A.L.R. 9, 84 A.L.R. 294, 94 A.L.R. 1223, 165 A.L.R. 879, 84 A.L.R.2d 1133; also 51 Am.Jur., Taxation, §§ 1183-1213, 84 C.J.S. Taxation §§ 634-637. This Court has consistently held that the voluntary payment of an illegal flax will not support a claim for repayment; but that a payment under duress, which may be either express or implied, is not a voluntary payment and may be recovered. Austin National Bank v. Sheppard, 123 Tex. 272, 71 S.W.2d 242; National Biscuit Co. v. State, 134 Tex. 293, 135 S.W.2d 687; Union Central Life Insurance Co. v. Mann, 138 Tex. 242, 158 S.W.2d 477; Metropolitan Life Insurance Company of New York v. Mann, 140 Tex. 450, 168 S.W.2d 212; State v. Akin Products Co., 155 Tex. 348, 286 S.W.2d 110.

The crucial test is whether the taxpayer acted under duress and duress was found in each of the foregoing decisions by this Court. Duress was not found in Corsicana Cotton Mills v. Sheppard, 123 Tex. 352, 71 S.W.2d 247, which was decided contemporaneously with Austin National Bank v. Sheppard. The duress in Austin National Bank rested on the fact that the refusal of the corporation to pay the additional filing fee demanded by the Secretary of State would have subjected it to the risk of having its right to do business in this state called in question with a resulting injury to its business should such occur. The absence of duress in Corsicana Cotton Mills rested largely on the conclusions that “ * * * we find nothing therein that can be construed as a contention that the taxes here involved were claimed or demanded by the state or any state authority”; and that the reports filed by the corporation gave the Secretary'of State “no information by which he could have known that any overpayment of franchise taxes was being made.”

In Metropolitan, as here, the insurance company overpaid the tax required of it under Article 4769. The report of the company reflected on its face a higher tax than was actually owed. The Commissioner of Insurance certified the incorrect amount shown on the report and forwarded to the State Treasurer the remittance of the company in payment of the certified amount. The only difference between the problem in Metropolitan, and here, is that the report form then prescribed for use in complying with Article 4769 subjected the company to a higher tax liability, if literally followed, than required by the statute. This was the basis for the statement im Metropolitan that “The form, in legal effect, demanded that such taxes be paid in conformity therewith. This is evident because the form, in effect, required relator to pay the very illegal taxes this appropriation was made to refund.” But it is to be noted that the company in Metropolitan did not consider itself bound by the report form and, indeed, included information not called for which reduced its tax liability. Nevertheless, this Court held:

“The form contained at the very beginning a very pertinent admonition or reminder. Such admonition or reminder reads as follows: ‘The officers of any company who knowingly submit under oath a tax return under which the amount paid is less than the amount actually due the State under its laws render themselves and the company subject to all the penalties provided by law for such action.’ [The forms in the case at bar contained the same admonition]
“To our minds the part of the report form just above quoted, in legal effect, was and is a statement that a failure, on the part of the relator, to make its report in conformity therewith, and so pay its taxes, would result in its' being subjected to the penalties prescribed. by our laws. One. of these, penalties was that it would not receive a renewal of its certificate to .do business in Texas. Article 4769, supra. The withholding of such' certificate would have compelled relator to cease writing insurance in this .state, and thus would have subjected it to a great inconvenience, and. financial loss. No court action was, or is, required to enable the Commissioner to withhold a renewal certificate. Taxes paid uri--der the circumstances we have detailed are taxes paid under duress.”

Implicit in Metropolitan is the holding that taxes are paid under duress when an act of the Commissioner of Insurance causes or results in an overpayment of taxes by an insurance organization, the payment of which in such amount is necessary to avoid the loss of the right of the insurance company to do business in this state. In Metropolitan this act was considered to be the furnishing of a report form which, if followed, would compel the payment of more taxes than owed. In the case at bar there is a comparable act which follows from the second major holding in Metropolitan. Article 4769 defines the duty of the Board of Insurance Commissioners with respect to the annual reports required by the statute, as follows:

“Upon receipt by it of the sworn statement above provided, the Board of Insurance Commissioners shall certify to the State Treasurer the amount of taxes due by such insurance organization which shall be paid to the State Treasurer on or before the fifteenth day of March, following, and the State Treasurer shall issue his receipt therefor as evidence of the payment of such tax.”

In construing the foregoing, this Court said in Metropolitan:

“The statute requires the Commissioner to certify to the State Treasurer the amount of taxes due. Certainly this does not confine the Commissioner’s certificate to the amount shown by a report if such report is incorrect. To so hold would be to add something to the statute not contained therein. The statute says that 'the Commissioner of Insurance shall certify to the State Treasurer the amount of taxes due by such company for the preceding year, * * The construction contended for by the respondents would call on us to add to the statute, the additional provision, as shown by such report, and would compel the Commissioner to issue a renewal certificate even though he knew the insurance company involved had not reported all taxes due.” (First italics added.)

It is thus the statutory duty of the Commissioner of Insurance to certify the correct amount of taxes due and owing by a reporting insurance organization, whether more or less than the amount shown by the report. The discharge by the Board of this duty to certify the taxes actually due and owing will necessarily disclose if a company has reported taxes which it does not owe. One of the controlling facts upon the basis of which no duress was found in Corsicana Cotton Mills was the absence of any information to indicate that the taxpayer had overreported and overpaid. The corollary fact of controlling, legal significance, which was also absent-in Corsicana Cotton Mills, is that the certification, in legal effect, is a demand by the state that the tax in such amount be paid, otherwise the company will subject it-’ self to the loss of its right to do business in Texas.

So it is that in the operation of the statute as it has been construed by this Court, the overpayment of taxes by Respondent for the years in question did not result from its failure to properly list its securities and to indicate the lower and proper rate in its reports. The overpay-ments resulted from the incorrect certifications, and under the rationale of Metropolitan, and other decisions by this Court, the payments by Respondent of the amounts certified by the Board of Insurance Commissioners were payments under duress of the certifications, and of the applicable statutory provisions. Respondent therefore has a valid claim for recovery of the overpayments of taxes which were included in the certifications of the Board of Insurance Commissioners for the years in question.

We recognize that it may not have been feasible (although it was possible) for the Board of Insurance Commissioners to have determined before the certification deadlines the correct amount of taxes due and owing by Respondent for the years in question. But our conclusions are not gainsaid by this fact nor by practices of expediency which may have developed during the years, i. e., that the reporting companies send along their remittances in the amount of the taxes shown in their reports and that the Board routinely certifies the amounts shown in the reports and transmits to the State Treasurer the remittances of the companies which accompanied their reports.

The judgments of the trial court and of the Court of Civil Appeals are affirmed.

CALVERT, Chief Justice

(dissenting).

I respectfully dissent.

The judgments of the trial court and the Court of Civil Appeals awarding Connecticut General a recovery are affirmed by this Court solely on the theory that its payment of more taxes than it owed was under duress. I suggest that on the record before ns the Court has reached a legal conclusion for which there is neither substance nor shadow of support in the facts.

It is not held that overpayment was made under actual duress; rather, it is held that overpayment was made under “implied duress.” “Implied duress” is a legal fiction, invented by the courts to give relief to those who in their own immediate self-interest yield to illegal or unwarranted demands rather than risk loss or harm by reason of failure to do so. So far as I can determine from the cases cited by the Court and from independent research, the legal concept of “implied duress” has never heretofore been used as a cloak for relieving one of the consequences of his own mistakes of fact. Here, the Court uses it as a basis for relieving Connecticut General not only of the consequences of its own mistakes of fact, but as well of the consequences of its own negligence.

The charge that Connecticut General’s overpayment of taxes resulted frcm its own negligence should not be made without a statement of the evidence which supports it.

The relevant part of the printed form furnished by the Board of Insurance Commissioners to insurance companies for making their annual reports, and the manner in which the form was completed by Connecticut General for the years 1952-1957, is illustrated by the report for the year 1952, which is reproduced.

The printed form provided Connecticut General with an entirely correct and proper basis for making its own simple arithmetical ascertainment of its tax liability. All it needed to do to keep from paying more taxes than it owed was to examine its books and records and with the use of an adding machine arrive at the figures to be placed in the blank spaces left • for its-convenience in items 3 and 4. Inasmuch as the record discloses that Connecticut Gen- . eral is one of the ten largest insurance companies in the United States, it is not a violent assumption that it had in its employ people entirely capable of analyzing its investments and people capable of using adding machines who, working together, could have provided the information for filling the blanks in both items 3 and 4. Once the blank spaces in items 3 and 4 were filled ■ in, a seventh grade student could have ascertained Connecticut General’s tax liability by following the, directions in the printed form.' The form even told how to find the ratio of investments in Texas securities to investments in similar securities in the state of highest investment; “item 3 divided by item 4,” it said. It then eliminated the necessity for knowledge of the taxing provisions of Art. 4769, V.T. C.S., by telling precisely what tax rate to apply to the ratio shown in item S. Simple multiplication of the figure shown in item 7 by the tax rate would furnish the basic tax due and owing.

We recognized in Metropolitan Life Ins. Co. v. Mann, 140 Tex. 450, 168 S.W.2d 212, that reporting insurance companies are under a duty to conform their reports to the forms furnished to them by the Board of Insurance Commissioners whose statutory duty it is to prescribe them. Indeed, it was because Metropolitan had complied with an improper form in figuring and paying its taxes, and only for that reason, that we held the overpayment of taxes in that case to have been made under implied duress.

The situation is entirely different in this case. Here, the correctness of the form is not challenged. Yet here, Connecticut General did not conform its report to the form. It will be noted that although it filled in the space in item 3, thus showing the amount it had invested in Texas securities, it did not fill in the space in item 4 showing the amount of its investments in the state of highest percentage of investments. Had it done so and done so correctly, the certificate showing an excessive amount of taxes due, on which the Court now predicates implied duress, would never have issued. Connecticut General offers no reason or excuse for failing to complete the form properly. The failure to complete the form by accurately furnishing the information required by item 4 was either willful or negligent. Since Connecticut General had nothing to gain and all to lose by the failure, it is obvious that the failure was not willful but was negligent.

Although it had failed to give the information required by item 4, Connecticut General did show in the reports the ratio of its investments in Texas securities to its investments in securities of the state of the highest percentage of investment. In each of the reports for the years 1952-1957, the ratio is shown as “Less than 7S%.” Connecticut General does offer an excuse, but hardly a valid reason, for putting this erroneous information in the forms. A Vice-President, who is also counsel for the company, testified that he was acquainted with the sliding scale of rates in Art. 4769, and that at various times during the 1952-1957 period he inquired (the record does not show of whom) why the company was paying the highest rate of tax, and was advised that on the basis of rough calculations the ratio of investments was not even close to 75%. This is proof once again of negligence. That the reports of taxes due, required to be made under oath, were made on a basis of “rough estimates” rather than on a basis of accurate accounting is almost gross negligence.

In preparation for making the report for 1958, the Vice-President-witness had an accurate accounting made for- the purpose of determining the ratio rate base for that year. Because of disclosures made by that accounting, he then had an accurate accounting made for the years 1952-1957, and discovered that for each year the actual ratio rate base was such as to require a tax rate of only 1.925 rather than 3.3.

As the Court points out, the statute requires that the annual tax reports be filed on or before March 1, and that the Board certify to the State Treasurer the amount of taxes due which must be paid by March 15. Some 200 or more insurance companies file the reports; and because of the brief period allowed for checking the reports, nothing more than a check of mathematical accuracy is made of reports which show the maximum tax rate to be due. If the tax is mathematically correct, the Board certifies to the State Treasurer the amount of the tax shown in the report. Thus it was that for each of the years in question the Board certified to the State Treasurer that Connecticut General’s tax was the same as shown in its reports. It is because of the issuance of these certificates that the Court holds that Connecticut General overpaid its taxes under implied duress. The conclusion is reached on the basis of certain language taken from Metropolitan Life Ins. Co. v. Mann, supra.

The language quoted from Metropolitan should be considered in its proper setting. Metropolitan was contending that if it had not paid the taxes unlawfully required of it by the erroneous form, its certificate to ■do business could have been withheld and thus that the payment was made under duress. The State was contending that even if Metropolitan had paid less tax than the form required, under a proper construction of the statutes it would have been subject to suit for the difference but its certificate could not have been withheld; that the threat of'suit was not duress. We simply agreed with Metropolitan’s construction of the statutes. In the course of so doing, we held that it is the duty of the Board to issue a correct certificate even if the report is incorrect. We did not hold that overpayments are made under duress when they are made according to a company’s own negligent calculations which are accepted and certified to the State Treasurer by the Board.

Connecticut General paid its taxes by check for each of the years in question. In each instance its check for the sum at which it had calculated its taxes was transmitted to the Board coincident with the filing of the report. At that time rio certificate had been issued; and there surely can be no basis for saying that the tender of payment of an excessive amount was made under duress. Finding the mathematics of the reports to be correct, the Board issued its certificates and accepted and transmitted the checks to the State Treasurer. The overpayments were thus not pursuant to the certificates but were pursuant to Connecticut' General’s own negligence. Any implied duress arising from the certificates could hardly operate retrospectively.

There is yet another reason why Connecticut General cannot predicate duress on the Board’s certificate. It never knew of the certificate. It was stipulated by the parties that Connecticut General never received any communication of any kind from the Board relative to its tax liability during the years in question, and there is no proof that it received a copy of the certificate from any other source.

Implied duress in this area of the law rests on threats. There must be an illegal or unwarranted demand for payment with provision in the law for the application of hurtful business sanctions if one refuses to meet the demand. In this situation the courts have held that one acts under duress even though no actual threat to invoke the sanctions has been made; that inasmuch as the sanctions are available, the demand implies a threat that they will be invoked. Now how can one having no knowledge of a demand act under an implied threat to invoke sanctions if he does not meet the demand ?

All of the cases cited by the Court in which recovery has been allowed are cases in which payment was made in response to a known demand for the amount paid. In Austin Nat. Bank v. Sheppard, 123 Tex. 272, 71 S.W.2d 242, the Secretary of State demanded and received a filing fee of $2,500 which was not authorized by law. In National Biscuit Co. v. State, 134 Tex. 293, 135 S.W.2d 687, the payments recovered were made in accordance with the known demands of unconstitutional statutes. In Metropolitan Life Ins. Co. v. Mann, 140 Tex. 450, 168 S.W.2d 212, payment was pursuant to the known demand of an unauthorized printed form. In State v. Akin Products Co., 155 Tex. 348, 286 S.W.2d 110, payment was in accordance with known demands 'of a State Commission pursuant to an unconstitutional statute.

Other cases of like result may be cited; but they, too, involved payments made .in response to known demands. In Crow v. City of Corpus Christi, 146 Tex. 558, 209 S.W.2d 922, payment of the gross receipts taxes or fees was pursuant to the known demands of an invalid city ordinance. In State v. Tennessee Gas Transmission Co., Tex.Civ.App., 289 S.W.2d 309, writ refused, n. r. e., and State v. Transcontinental Gas Pipe Line Corp., Tex.Civ.App., 292 S.W.2d 826, writ refused, payment was according to the known demands of an unconstitutional statute.

That a known demand is basic to a right of recovery of taxes paid under implied duress is the clear implication of Corsicana Cotton Mills v. Sheppard, 123 Tex. 352, 71 S.W.2d 247, in which recovery was denied. In that case, as in this, there was an overpayment of taxes. The overpayment was based on the taxpayer’s misconstruction of franchise tax statutes. In denying recovery, the Court said:

“As we understand this record, the secretary of state never at any time made any demand on relator to pay franchise taxes for the years involved in this claim on its capital set-up employed outside this state. Furthermore, in our opinion this record contains no evidence that can reasonably be interpreted as showing or tending to show, that the secretary of state, the Attorney General, or any other state authority ever made any ruling or demand that would have justified relator in paying the taxes here involved on its capital set-up employed outside the state.” 71 S.W.2d 248.

Replying to a contention that statements in the report forms relating to penalties constituted implied duress, the Court said:

“We have carefully read the above information contained in blank forms as above indicated, and we find nothing therein that can be construed as a contention that the taxes here involved were claimed or demanded by the state or any state authority.” 71 S.W.2d 250.

In the instant case the only demand known by Connecticut General was the demand of Art. 4769 for a sliding scale percentage of its gross Texas premiums for the preceding year, the percentage to be based on the ratio of its investments in Texas securities to its investments in securities of the state of its highest percentage of investment. Its overpayment of taxes was because of its own negligence in failing accurately to comply with the demand. Its situation here is as though no certificate of the Board had been issued. It is the same as if one had incorrectly calculated and overpaid a gross receipts tax imposed by an unconstitutional statute or an invalid city ordinance; he would have paid the tax demanded or required by the statute or ordinance under implied duress, but the excess would not have been paid under implied duress.

I respectfully suggest that the holding of duress in this case extends that concept beyond reality; that it makes the concept of acts done under duress and the concept of acts done by mistake or by reason of negligence legal equivalents.

Connecticut General advances two other theories for allowing recovery: (1) that the overpayment of taxes was made as a result of a unilateral mistake in the nature of a clerical error, and (2) that it was made as a result of a mutual mistake of the parties. Recovery is not allowed by the Court on either theory. Assuming the theories to furnish sound and accepted legal bases for recovery in this jurisdiction, an assumption for which there is no support in decided cases, there is simply no evidence to support them.

The evidence attending Connecticut General’s overpayment has been summarized. Testimony that someone in the organization told the Vice-President-witness that on the basis of rough calculations the ratio of investments had not reached 75% is not evidence of a unilateral mistake “in the nature of a clerical error,” such as was held in Taylor & Son Inc. v. Arlington Independent School District, 160 Tex. 617, 335 S.W.2d 371, to relieve a bidder of the legal consequences of an erroneous bid. Moreover, the evidence is pure hearsay and does not prove the truth of what it purports. Aetna Ins. Co. v. Klein, 160 Tex. 61, 325 S.W.2d 376. Evidence that the Board certified erroneously the amount of taxes due does not establish that the overpayment was the result of a mutual mistake. From the standpoint of Connecticut General, the erroneous report was, on the record before us, the result of negligence. From the standpoint of the Board, the erroneous certificate was the result of failing to obtain and check all records necessary to the making of a correct certificate.

It is too obvious to warrant discussion that it is unjust for the State to keep the overpayments of taxes made by Connecticut General. It was also unjust for the State to keep the overpayments of the taxpayer in Corsicana Cotton Mills v. Sheppard, supra. Perhaps the time has come to re-evaluate the relationship between the taxpayer and his government, and to require that government disgorge monies received by it to which it is not justly entitled and which it should not in good conscience retain. Government is no more entitled to be unjustly enriched at the expense of its citizens than is one citizen at the expense of another. Although finding implied duress in Crow v. City of Corpus Christi, 146 Tex. 558, 209 S.W.2d 922, this Court’s primary concern was with the City’s moral conduct as is evidenced by this language (209 S.W.2d 925) :

“The city received from the companies money to which it now appears it was not entitled and, under the circumstances detailed, it would not be just for the city to continue to retain the money. * * * It would be against good conscience for the city not to pay back to petitioners the money thus received.”

I would look with favor on a holding that a taxpayer is entitled to recover taxes paid in excess of the amount he justly owes under a proper construction of taxing statutes, once the overpayment is established by a judgment of a court of competent jurisdiction. A holding of that character would permit recovery of excess ad valor-em taxes voluntarily but negligently paid by a widow in response to a statement of a tax collector who has made a mathematical error in his computation of taxes due. But until a rule of law is adopted which with equal certainty authorizes a recovery of the “widow’s mite,” I am unwilling to pile fiction of knowledge of demand upon fiction of threats in order to reimburse Connecticut General’s half a million paid voluntarily but negligently. Rules of law should apply to all alike.

Since affirmance here rests on a holding of implied duress and I can find no basis in the record for the holding, I must dissent.

CULVER, WALKER and HAMILTON, JJ., join in this dissent.

      . Article 4769 remained so designated notwithstanding the enactment of the Insurance Code of 1951 and of Title 122A, Taxation, in 1959. It is carried under Title 78, Insurance, at page 484 of volume 14A, Yernon’s Annotated Texas' Statutes.

      , The 1957 amendment to the Insurance Code of 1951 provides that “Except as otherwise provided herein, all remaining references in- the Insurance Code and other statutes of this state to ‘Board of Insurance Commissioners,’ ‘Board,’ or individual Commissioners shall mean the ‘State Board of Insurance’ or the ‘Commissioner of Insurance,’ consistent with their respective duties and responsibilities under the terms and provisions of this amendatory Act.” Art. 1.02(e); Acts 1957, 55th Leg., p. 1454, ch. 499, §2. . ,


source: Caselaw Access Project

author: WILSON, Justice.

license: Public Domain

text:
    STANDARD CONCRETE PIPE SALES CORPORATION et al., Appellants, v. ED JOHANSSON CONSTRUCTION COMPANY et al., Appellees.
    No. 4271.
    Court of Civil Appeals of Texas. Waco.
    Oct. 1, 1964.
    Rehearing Denied Oet. 16, 1964.

      Herbert Finkelstein, Houston, for appellants.
    McLeod, Mills, Shirley & Alexander, Armstrong, Bedford & Lambdin, Galveston, for appellees.
   WILSON, Justice.

A supplier of material, appellant, sued a public works contractor to whom it had furnished material, and the surety on the contractor’s payment bond. Appellant recovered against the contractor, but judgment was rendered that it take nothing against the surety. We affirm.

Appellants’ single point is that Acts 56th Legislature, R.S.1959, Ch. 93, p. 155, is unconstitutional “because it violates Article 3, Sec. 35 of the Constitution of Texas, requiring an act to have only one subject, which shall be expressed in its title.” It is not contended the subject is not expressed in the title of the Bill. Appellants’ position is that the Bill contains multiple subjects.

The first section of the challenged enactment, as material here, requires in effect that a prime contractor entering into a formal public construction contract in excess of $2,000 shall execute a payment bond upon which suit may be brought for unpaid material claims after giving specified notices. The second section provides for the fixing of a lien in favor of the material claimant on payments due the contractor, if the prime contract does not exceed $2,000. It also contains detailed notice requirements.

The relevant portion of the title reads: “An Act relating to the requirement of performance and payment bonds by public contractors and claims and liens thereunder for materials and labor; amending Article 5160 of the Revised Civil Statutes of Texas, 1925, and Section 1, Chapter 17, Acts of the Thirty-ninth Legislature, 1925” (Art. 5472a).

The first section of the present Act amends a statute compiled as Art. 5160, Vernon’s Ann.Tex.Civ.St, which in effect required a contractor’s payment bond in connection with all public contracts, without limitation as to the amount of the contract. The second section amends Art. 5472a, V.A.T.S., which, as it then existed, provided for the fixing of a lien on payments due the contractor in favor of all material claimants, irrespective of the amount of the contract.

Appellants’ argument is that before the 1959 enactment a materialman could enforce his claim against a contractor both by fixing a lien on payments due under Art. 5472a, and by recovery on the contractor’s payment bond under Art. 5160, without regard to the amount of the contract; that the Legislature had previously dealt with these two methods by separate statutes; that the title of the 1929 Act which was originally compiled as Art. 5160, as well as that of its 1913 predecessor, referred only to “bonds” in connection with public con-stuction contracts, whereas the title of the bill which became Art. 5472a referred only to “liens”. Appellant says, “It is our contention that these two subjects, hitherto treated separately by the Legislature, could not be treated in a single Act because of the prohibition of Art. 3, Sec. 35 of the Constitution.”

In McMeans v. Finley (Byrom v. Finley), 88 Tex. 515, 521, 32 S.W. 524, 525, Chief Justice Gaines said of Sec. 35 that “the provision as to one subject does not apply where two matters are incorporated in the act which are germane to each other, and parts of the same general subject-matter.”

The general subject of this enactment is safeguarding of contractors, suppliers and others against loss in public contracts. The emergency clause recites its provisions “are necessary to provide simple direct methods of giving notice and perfecting claims.” The statute authorizes one method for a contract involving over $2,000, and another method for smaller contracts. They relate to only one subject. The constitutional requirement that a bill shall contain no more than one subject “does not mean it shall contain only one provision. Its purpose is to prevent the joining in one act of incongruous and unrelated matters, and an act may contain any number of provisions which tend to further its purpose.” 1 Cooley, Constitutional Limitations, (8th ed.) 308. That the statute affords more than one method of accomplishing its object does not necessarily mean it embraces more than one subject if these methods are germane and relate to the main subject of the statute. Campbell v. Cook, 86 Tex. 630, 26 S.W. 486, 40 Am.St.Rep. 878; Robbins v. Limestone County, 114 Tex. 345, 268 S.W. 915, 920; Missouri K.-T. R. Co. v. Rockwall County, etc., 117 Tex. 34, 44, 297 S.W. 206, 209; City of Beaumont v. Gulf States Utilities Co., Tex.Civ.App., 163 S.W.2d 426, 431, writ ref. See Key Western Life Ins. Co. v. State Board of Insurance, 163 Tex. 11, 350 S.W.2d 839, 843; Ex parte Jimenez, 159 Tex. 183, 317 S.W.2d 189, 194.

The Act is not subject to the objection made. Affirmed.


author: NORTHCUTT, Justice.

text:
    Malouf ABRAHAM, Appellant, v. J. D. CROW et al., Appellees.
    No. 7399.
    Court of Civil Appeals of Texas. Amarillo.
    Sept. 28, 1964.

      Wm. J. Jackson, Canadian, for appellant.
    James D. Crow, Canadian, for appellees.
   NORTHCUTT, Justice.

This is an action brought by appellees, J. D. Crow et al., against appellant, Malouf Abraham, seeking partition of eighty acres ■of land in Hemphill County, Texas. Ap-pellees contended they owned an undivided one-third interest in the land and appellant •owned the other two-thirds. The appellant contended he owned all of the eighty acres •and appellees had no interest in the eighty acres. It was stipulated by the parties that the common source of title to the property in question was one R. C. Keith. It was further stipulated that said land could not be partitioned in kind and in the event of judgment for appellees, the land should be sold in order to effect partition. There is no question as to the ownership of the two-thirds interest in the property.

The case was originally tried to a jury. At the close of the evidence both appellant and appellees presented to the court their motions for instructed verdict; respectively, and the court overruled both of said motions and both parties excepted. The parties, after the court had refused to grant their motions for judgment, agreed that the jury should be discharged by the court and the matters of fact, if any, as well as of law be determined by the court. The court found in favor of plaintiffs, appellees herein, and granted judgment that appellees recover of and from appellant an undivided one-third interest in the property in question and ordered the land sold. The court appointed J. O. Wells as receiver to sell said property. From that judgment appellant perfected this appeal.

Appellant presents this appeal upon three assignments of error. The first assignment contends the court erred in overruling appellant’s motion for instructed verdict; in holding that appellees made out a prima facie case against appellant; and that appellees owned an undivided one-third interest in the land in dispute and were entitled to partition of the same. We are of the opinion when the parties agreed for the court to discharge the jury and to submit the facts and the law to the court the exception as to the failure of the court to instruct the jury to find for appellant was waived. However, we will consider appellant’s contention that the court erred in holding that appellees made out a prima facie case against appellant and that appellees owned an undivided one-third interest in the land in dispute. It was stipulated the common source of title to the property in question was one R. C. Keith and appellees introduced a certified copy of the warranty deed from Keith to Don Pattie covering the property here involved. Appellant objected to the admission in evidence of the certified copy of the warranty deed from Keith to Pattie because no affidavit was filed concerning the original deed so as to permit its introduction as provided under Articles 3726 and 3726b. Appellees testified without objection as to the matters covered under said Articles. It is stated in Hill & Jahns v. Lofton, Tex.Civ.App., 165 S.W. 67 (writ refused) as follows:

“ * * * it seems to be now well settled that the evidence of a witness on the stand as to inability to produce the original deed is equivalent to the statutory affidavit, and is sufficient to authorize the introduction of a certified copy.”

The appellant further objected to the introduction of the warranty deed from Keith to Pattie because Keith’s name did not appear in the acknowledgement. This identical question was passed upon in the case of McMurrey v. Lampkins, Tex.Civ. App., 47 S.W.2d 851, and was contrary to appellant’s contention. In the case of North American Building & Loan Ass’n v. Bell, Tex.Civ.App., 88 S.W.2d 633, the wife’s name did not appear in the acknowl-edgement but was held sufficient. Appellant also objected as to the certified copy of the warranty deed from Pattie to Crow. The original warranty deed from Pattie to Crow was then introduced which would take place of the certified copy. Appellant’s first point of error is overruled.

By appellant’s second point of error it contends the court erred in admitting into evidence the deed from Keith to Pattie for the same reason expressed in his first point of error. For the same reasons given above herein, appellant’s second point of error is overruled. .

By appellant’s third point of' error it is contended the court erred in failing to grant appellant’s motion for an instructed verdict at the conclusion of the'testimony in this case and in awarding judgment for appellees, thereby treating the deed from Keith to appellant as a quitclaim deed. We will have to consider this point as being the court erred in holding the deed from Keith to appellant was a quitclaim deed. Keith was the common source of title. Keith, by warranty deed, transferred this property to Pattie on April 29, 1948. Pattie transferred the property to Crow by warranty deed on December 5, 1958. Keith transferred the property by quitclaim deed to appellant on August 27, 1957.

As contended by appellant the warranty deed from Keith to Pattie was material to this cause and was the only basis for holding invalid the deed from Keith to appellant. Some nine years before Keith transferred the property to appellant, he had transferred the property by warranty deed to Pattie. Pattie transferred the property to Crow by warranty deed. Under Article 1290, Tex.Civ.St, Keith, when he attempted to transfer the property to appellant, could transfer no greater right than he had. There are no questions presented, in this case about either the five or the ten-year statute of limitations. Where property has been conveyed by the owner, his subsequent conveyance conveys no title. Cooksey v. Blair, Tex.Civ.App., 254 S.W. 509 (writ dismissed). We think the deed from Keith to appellant clearly shows it was purported to transfer no more than the title of Keith and was only a quitclaim. Hale v. Hale, Tex.Civ.App., 93 S.W.2d 535 (writ dismissed).

It is stated in the case of McMahon v. Fender, Tex.Civ.App., 350 S.W.2d 239 (N.R.E.) as follows :

“A quitclaim deed does not of itself establish any title in those holding under it. The quitclaim passes the interest of the grantor in the property,, and for the quitclaim to be a conveyance, title in the grantor must be shown. See: 41A Tex.Jur., p. 551, par. 34; Watkins v. Smith, 91 Tex. 589, 45 S.W. 560; Richardson v. Levi, 67 Tex. 359, 3 S.W. 444; Garrett v. Christopher, 74 Tex. 453, 12 S.W. 67; 19 Tex.Jur.2d par. 11, p. 256.”

We are of the opinion, and so hold, that the deed from Keith to appellant clearly shows that Keith only attempted to transfer whatever interest he had in the property and that said deed was a quitclaim. When Keith transferred the property to appellant, he had no title as he had transferred whatever title he had to Pattie and could transfer no better title than he had.

Judgment of the trial court is affirmed.


author: RENFRO, Justice.

text:
    TEXAS ELECTRIC SERVICE COMPANY, Appellant, v. Leslie A. MYERS, Appellee.
    No. 16562.
    Court of Civil Appeals of Texas. Fort Worth.
    Sept. 18, 1964.
    Rehearing Denied Oct. 16, 1964.
    Fillmore, Schaeffer & Fillmore, Wichita Falls, Cantey, Hanger, Gooch, Cravens & Scarborough, and Jack C. Wessler, Fort Worth, for appellant.
    Friberg & Parish, Philip S. Kouri and David A. Smith, Wichita Falls, for ap-pellee.
   RENFRO, Justice.

Appellant acquired, by condemnation, an easement of right-of-way for electric transmission lines which embraced an area of 8.26 acres out of a tract of 95.7 acres.

Neither side complains of the amount of the jury award for the strip taken.

In answer to issues 3 and 4 the jury found the before and after market value of the remaining 87.4 acres to be $43,700 and $34,960 respectively.

Appellant’s one point of error contends there was no evidence to support the answers to issues 3 and 4.

The appellee’s evidence shows his land abuts Burk’s Drive on the north. Burk’s Drive is paved and there are eleven residences on said Drive within a half mile of his land. Land within a block of ap-pellee’s land is being sold for residential purposes. There is a second street approximately 1000 feet east of his land. The land owned by appellee is rectangular in shape. Appellant’s power line runs from the north boundary to the south boundary through the center of the tract, lengthwise. Another line runs from the above line to the east boundary line of appellee’s land, about two-thirds of the distance from the beginning point on the north boundary line to the south boundary line. There remains 46 acres west of the power line, 25 acres in the northeast corner of the tract north of the “short” power line, and 16.4 acres in the southeast portion of his land, south of the east-west line and east of the north-south main line. Appellant erected six large towers on the north-south easement and four on the west-east easement. One tower is only 12 feet from Burk’s Drive. The taller towers are 100 feet tall.

Appellee testified his land is flat and level except for one small meandering creek. His land is 1000 feet from the Wichita Falls city limits.

The witness Southers, who lives nearby appellee’s land and is familiar with the land, testified the market value of the land was $1000 per acre before and $200 per acre after the taking.

Witness Hill, a real estate dealer and residential subdivision developer, testified: the west 46 acres of appellee’s land had a market value of $1000 per acre before and $700 per acre after the taking; the northeast 25 acres had a before value of $1000 per acre and an after value of $500 per acre; the southeast 16.4 acres had a $1000 per acre value before and a $300 per acre value after the taking; the land is close to utilities and is approximately 7 miles from downtown Wichita Falls; he developed the Meadow Lake residential subdivision, 9 miles from downtown Wichita Falls, in the general area of appellee’s land; sewer and water lines were a mile away from his Meadow Lake development; there is a sewer line 1900 feet and a water line 1000 feet from appellee’s land; the 46 acres west of the easement strip is large enough to allow proper planning to be carried out to a certain extent; the northeast 25 acres could be planned better than the 16.4 acre tract, but “The 16 acre tract is just almost ruined by being surrounded by the lines.” Thus, according to his testimony, the market value of the remaining 87.4 acres, as trisected by the easement, was $49,620, which was-$37,780 less than his opinion as to the market value of the 87.4 acres before the taking. His testimony is that the decreased value ($11,480) of the “just almost ruined”1 16.4 acre portion alone was greater than the amount of decreased market value of the entire remaining 87.4 acres found by the jury, namely $8,740.

Appellant’s witness Wilkins admitted that a tract of land with sewer lines within 19001 feet and water lines within 1000 feet would be more valuable for development purposes than a tract with sewer and water lines a mile away.

In addition to the oral testimony the jury had the benefit of exhibits and a great number of pictures of the land and the power lines.

“Generally, it may be said that it is proper as touching the matter of the value and depreciation in value to admit evidence upon all such matters as suitability and adaptability, surroundings, conditions before and after, and all circumstances which tend to increase or diminish the present market value.” State v. Carpenter, 126 Tex. 604, 89 S.W.2d 194 (1936).

The evidence summarized above shows there was some evidence, within the above rule, to support the jury’s findings.

The no evidence point is overruled.

Judgment affirmed.


author: TIREY, Justice.

text:
    MISSOURI PACIFIC RAILROAD CO., Appellant, v. Robert Lee BURNS, Appellee.
    No. 4243.
    Court of Civil Appeals of Texas. Waco.
    Oct. 1, 1964.
    Rehearing Denied Oct. 22, 1964.
    Jackson, Walker, Winstead, Cantwell & Miller, Jack Pew, Jr., Dallas, for appellant.
    W. L. Tandy, Waco, for appellee.
   TIREY, Justice.

This action is grounded on a crossing collision. Plaintiff went to trial on his First Amended Original Petition, in which he alleged that the defendant was guilty of negligence in seven different particulars. They are substantially as follows:

1. That defendant failed to stop its train prior to reaching the intersection with the crossing with knowledge of the approaching presence of plaintiff ;
2. For failure to keep a proper lookout;
3. In failing to provide a stop sign or other signal device at an extra hazardous crossing within the limits of the City of Mart;
4. In failing to sound the whistle and ring the hell prior to reaching and crossing said intersection in violation of Art. 6371 of Vernon’s Ann.Tex. St.;.
5. In failing to have a flagman or other signalling device at the end of the train while it was hacking into the crossing;
6. In failing to have a light showing upon the rear of the train while hacking into the intersection;
7. In failing to comply with Article 6371, V.A.T.S.

Defendant went to trial on its First Amended Original Answer. It contained a general denial and specially plead that plaintiff was guilty of negligence in that he failed to stop his automobile before he reached a point 15 feet from the nearest rail of the track upon which the train was being operated; that the engine sounded a signal audible from a distance of approximately 1500 feet, and that the train was clearly visible, and that it was the duty of the plaintiff, as provided in Article 6701d, Section 86, Vernon’s Ann.Revised Civil Statutes, to stop his automobile not more than 50 feet nor less than 15 feet from the nearest rail of such track; that such failure of the plaintiff to so stop and remain stopped proximately caused or contributed to cause the injuries and damages he claimed to have sustained. He further plead defendant was negligent in failing, (a) to keep a proper lookout, and (b) in failing to stop his automobile before proceeding onto the crossing.

The jury found substantially, that defendant failed to stop its train at the intersection upon seeing the lights of the approaching plaintiff’s vehicle, but that such failure was not negligence, (Issues 1 & 2) ; that the intersection was an extra hazardous one, and that defendant’s failure to provide alight or flagman or other signal device at such intersection was negligence, and that such failure was a proximate cause of plaintiff’s injuries and damages, (Issues 4,. 5, 6 and 7); that defendant failed to provide a light, on the rear end of the train while backing over the intersection, and. that such failure was negligence, and was a. proximate cause of the injuries, (Issues 11, 12 and 13); that defendant did not fail to continue to ring the bell on the train until crossing the intersection, (Issue 17); that the cost to repair the plaintiff’s car to be $165.00, (Issue 20); and fixed plaintiff’s physical pain and suffering at $1500.00, (Issue 21); that the engine was approaching within 1500 feet of the crossing and while so doing emitted a signal audible from such distance, and that such audible signal was given before plaintiff reached a point 15 feet from the nearest rail of the railroad track upon which the train was traveling, and that at the time inquired about in Issue 23, that defendant’s train, by reason of its speed or nearness to the crossing, was an immediate hazard, (Issues 22, 23 and 24) ; that defendant’s train was not plainly visible before plaintiff reached a point 15 feet from the nearest rail of the railroad track upon which the train was traveling, (Issue 25) ; that the train was in “hazardous proximity” to the crossing before plaintiff reached a point 15 feet from the nearest rail of the track upon which defendant was traveling, (Issue 26) ; that the failure of plaintiff to stop his car within 15 feet from the nearest rail of the railroad track upon which the train was traveling was a proximate cause of the collision, (Issue 27); that plaintiff’s failure to stop his car at the time before proceeding onto the track was not negligence, (Issue 28) ; that plaintiff did not fail to keep a proper lookout, (Issue 30).

Plaintiff’s motion asked the court to enter judgment in his favor, based on the answers of the jury to Issues 4, 5, 6, 7, 11, 12 and 13, and in the amount of $1665.00, by virtue of the jury’s answers to Issues 20 and 21. He asked the court to disregard the findings of the jury to Issue 24, for the reason that said issue is not confined to the statutory duty required by law of plaintiff as being the basis of contributory negligence as set out in Art. 6701d, Sec. 86(c), and further because the answer is in conflict with the finding of the jury to Issue 28. Issue 28 is: “Do you find from a preponderance of the evidence that the failure of Robert Lee Burns to stop his automobile at the time and on the occasion in question before proceeding onto the track in question was negligence?” To which the jury answered, “No”. The motion asked the court to set aside and disregard the answers of the jury to Issues 26 and 27; and contends that the answers to Issues 28, 30 and 31 negative any violation of Article 6701d, aforesaid.

The court overruled defendant’s motion for judgment, but granted plaintiff’s motion for judgment on the verdict, but did not enter any order disregarding any of the findings made by the jury. In the judgment we find this recital: “ * * * and it appearing to the court that such verdict is complete, the court received and filed same, and it appearing that plaintiff, Robert Lee Burns, is entitled to judgment on the jury’s verdict, * * * ” and the court entered judgment in favor of plaintiff for the sum of $1665.00.

Appellant assails the judgment on 9 points. Point 1 is:

“The * * * court erred in refusing to render judgment on the verdict in favor of appellant, because, in answer to Special Issues Nos. 22, 23, 24 and 27, the jury returned complete findings that appellee violated Art. 6701d, Sec. 86(c), Texas Revised Civil Statutes, which violation constitutes negligence per se.”

We sustain this point and it requires us to reverse and render this cause. Section 86 of Art. 6701d, provides in part:

“Whenever any person driving a vehicle approaches a railroad grade crossing, the driver of such vehicle shall stop within fifty (50) feet but not less than fifteen (15) feet from the nearest rail of such railroad and shall not proceed until he can do so safely when:
******
“(c) A railroad engine approaching within approximately fifteen hundred (1500) feet of the highway crossing emits a signal audible from such distance and such engine by reason of its speed or nearness to such crossing is an immediate hazard.”

Defendant specially plead that plaintiff violated the foregoing provisions. Sufficient evidence was tendered to raise such defense, and the court submitted the violation in the following manner:

Issue 22, “Do you find from a preponderance of the evidence that when the defendant’s railroad engine in question was approaching within approximately fifteen hundred (1500) feet of the crossing in question such engine emitted a signal audible from such distance?”
“Answer: Yes.
Issue 23, “Do you find from a preponderance of the evidence that such audible signal, if any you have found, was given before the plaintiff, Robert Lee Burns, reached a point fifteen (15) feet from the nearest rail of the railroad track upon which defendant’s train in question was traveling?”
“Answer: Yes.
Issue 24: “Do you find from a preponderance of the evidence that at the time inquired about in the foregoing special issue No. 23, that defendant’s train in question, by reason of its speed or nearness to the crossing in question, was an immediate hazard? Answer: Yes.
Issue 27: “Do you find from a preponderance of the evidence that the failure of Robert Lee Burns to stop his automobile within fifty (50) feet but not less than fifteen (IS) feet from the nearest rail of the railroad track upon which defendant’s train was traveling, was a proximate cause of the collision in question ?
“Answer: Yes.”

There were no valid exceptions to Issues 22, 23, 24 and 27, and the court did not sustain any exceptions of plaintiff to the charge, and there are no cross-assignments thereon. As above stated, the court, in the judgment, found that the verdict was complete and entered judgment thereon.

In Burton v. Billingsly, Tex.Civ.App., 129 S.W.2d 439, w. ref. point 7, we find the rule:

“Contributory negligence and proximate cause ordinarily are questions of fact to be decided by the jury. They become questions of law, however, when they consist of the violation of law or the circumstances are such that, in the opinion of the court, reasonable minds could not arrive at different conclusions.”

Our Supreme Court has not seen fit to change or modify the foregoing rule. In the case at bar we have jury findings expressly holding that appellee violated the express provisions of Section 86(c), of Art. 6701d.

Chief Justice Calvert, in his law review article (34 Tex.L.Rev. 977), in discussing the violation of the foregoing statute as it related to the factual situation in the McFerrin case, [Missouri-Kansas-Texas R. Co. v. McFerrin], 156 Tex. 69, 291 S.W.2d 931, said:

“The courts of this state have adopted and follow the general rule that violation of a statutory duty is negligence per se, and that once the violation is established the only added finding necessary to establish a defendant’s liability (or to bar a claim, if the violation be by a plaintiff) is that the violation of the statutory duty was a proximate cause of the plaintiff’s injuries.”

Under the provisions of the foregoing statute a motorist at a grade crossing must stop within 50 feet and not less than 15 feet from a railroad when the engine of a train approaching from within 1500 feet is emitting a signal audible from such distance and is an immediate hazard. The undisputed evidence and the jury’s findings are that before appellee reached a point 15 feet from the track the engine was emitting such an audible signal, and was am immediate hazard. That is the substance of the findings of Issues 22, 23 and 24 above quoted. It is undisputed that ap-pellee did not stop and counsel for ap-pellee so stated in oral argument. Issue 27 expressly found that appellee’s failure to stop inside the statutory area was a proximate cause of the collision, and such finding convicted appellee of contributory negligence and precluded him from any recovery. But appellee contends that because the jury acquitted him of common-law negligence in not failing to keep a proper lookout, and in not failing to stop his automobile before proceeding onto the track, entitled him to a judgment on the verdict. We overrule this contention. See Texas & Pacific Railway Company v. Snider, 159 Tex. 380, 321 S.W.2d 280; Peters v. Chicago, R. I. & P. R. Co., Tex.Civ.App., 257 S.W.2d 860, n. r. e.; Martin v. Tex. & N. O. R. Co., Tex.Civ. App., 375 S.W.2d 554, n. w. h. Moreover, in Texas & New Orleans R. Co. v. Day, 159 Tex. 101, 316 S.W.2d 402, our Supreme Court made the following pronouncement:

“Submission of petitioner’s common-law defense of failure of the truck operator to keep a proper lookout did not satisfy the requirement for submission of the statutory defenses.”

He also contends, as we understand his brief and oral argument, that the answer of the jury to Issue 24 is of no force and effect because it contained no definition of “immediate hazard”. Assuming without deciding that such a definition would have been proper or necessary under the opinion of the Supreme Court in the McFerrin case,

supra, and under Justice Calvert’s Article in 34 Tex.L. Rev., supra, its omission constitutes no basis for disregarding the jury’s answer to Special Issue 24, because such matter was not called to the attention of the court by any objection or any request. Issue 24 was a controlling issue expressed in the language of the statute, and-both appellee and appellant waived the absence of any explanatory instructions. See Rule 274, Texas Rules of Civil Procedure. See also Supreme Court opinion Allen v. American Nat. Ins. Co., 380 S.W.2d 604, pages 608, 609. Since the court in its judgment did not disregard the jury’s findings convicting appellee of contributory negligence, he is precluded from any recovery. Because of the foregoing views expressed each of the remaining points passes out of the case.

The judgment of the trial court is reversed and rendered.


author: HIGHTOWER, Chief Justice. STEPHENSON, Justice

text:
    Robert Richard JOHNSON, Appellant, v. SOUTHWESTERN BELL TELEPHONE, INC., et al., Appellees.
    No. 6682.
    Court of Civil Appeals of Texas. Beaumont.
    Sept. 17, 1964.
    Rehearing Denied Oct. 7, 1964.

      Fulmer, Fairchild & Badders, Nacog-doches, for appellant.
    James E. Barden, Houston, Larry Barnes, Dallas, Wardlow W. Lane, Center, for appellees.
   HIGHTOWER, Chief Justice.

Plaintiff, Robert Johnson, brought suit jointly against defendants, Southwestern Bell Telephone, Inc. and James Cozort, for damages for personal injuries received when plaintiff was struck by a truck belonging to said company and which was being driven by Cozort in the course of his employment for said company.

Trial was to a jury, which found that Cozort did not fail to keep a proper lookout; that Cozort’s failure to warn Johnson and his failure to drive to one side of Johnson was not negligence; that Johnson sustained injuries as a result of being struck by the truck; that Cozort did not know that Johnson was in front of the truck; that Johnson’s damages were $7,590.00. The jury failed to find Johnson guilty of any negligent acts or omissions, but did find the accident to be unavoidable. Hence, plaintiff’s appeal.

Plaintiff first complains of the refusal •of the trial court to permit the witness Blakey to testify to impeach the witness Watson, who had testified for defendant. Counsel for plaintiff asked that the rule be invoked, and the trial court admonished the witnesses as to the rule. The witness Blakey had been employed by plaintiff as an investigator, and was not placed under the rule. Blakey was present during the introduction of some of the testimony, but •testified upon a bill of exception that he was not present at the time Watson testified. Under examination by counsel for plaintiff, he testified relative to the day of Watson’s testimony:

. “Q. Did you, at my request, stay out of the hearing of the courtroom today ?
“A. That is correct.
“Q. During any time that you were in the courtroom, yesterday or day before yesterday, did you hear or see Cecil Watson even in the courtroom?
“A. No, sir.
“Q. Or did you hear him testify?
“A. No, sir.”

The trial court, on the bill of exceptions, stated:

“Mr. Blakey has been in the courtroom at various times today for that matter but the Court is in no position to say that he was here while any testimony was being offered. Court is in no position to say whether he was or was not. He has been in the courtroom at some time or times today. * * * I say I’m not in a position to say about that. I have no recollection of it at all. I recall having seen him in the courtroom but it could have been this morning before Court resumed for that matter. I have no independent recollection.”

A résumé of the physical facts is material:

Defendant’s aerial telephone cable had been burned the night before at the scene of a filling station fire. Plaintiff, Robert Chumley, and Barney Milford, employees of the City, were at the scene in connection with damage to light and water facilities owned by the City. Shortly after Cozort arrived at the scene in his pickup truck in connection with the damage occasioned by the fire to defendant’s telephone cable, Chumley instructed plaintiff to take a meter out. The top of the meter box was level with the ground, and the meter below the ground. He had difficulty removing it, and while working to do so, was down on his knees with his shoulders lower than his hips and his hands down inside the meter box. The meter was in front of defendant’s parked truck, and as plaintiff was working on the meter his shoulders were over the meter and his hips were some three feet or more farther from the front of the truck than his head. While plaintiff was working on the meter in this position, Coz-ort got into the truck, started it, and drove it forward, striking and injuring plaintiff.

Plaintiff testified that when Cozort arrived at the scene and parked his truck, he, plaintiff, was standing about 14 feet from the meter box. When he arrived, Cozort put on his tools and climbed a telephone pole in front of the defendant’s truck. The meter box was five or six feet in front of the truck and the telephone pole was five or six feet from the meter box. Cozort walked by the meter box to get to the pole. When Chumley told plaintiff to get his tools and take out the meter, Cozort was up the pole. Cosort had to pass right by plaintiff to get back to his truck, and plaintiff is positive Cosort walked by the meter where he was working when he came from the pole to his pickup. There was nothing to keep Cosort from seeing plaintiff.

Witness Chumley couldn’t recall whether Cozort had arrived when Chumley told plaintiff to take the meter out, but Cozort’s truck was there when plaintiff started work on the meter. According to his best recollection, Cozort did go over and climb the telephone pole, but he wouldn’t say he did; he just doesn’t remember. He testified that to go to and come from the telephone pole, Cosort would have had to pass within three or four feet from where plaintiff was working on the meter.

Defendant Cozort testified that when he arrived at the scene he stopped his truck and talked to Chumley, who was toward the back of the truck, for about four or five minutes. He then returned directly to his truck and drove forward. As he drove forward, he felt the truck bump plaintiff, got out, went around in front and asked if plaintiff was hurt. At no time that day did he climb the telephone pole at the scene. If he had gone to the pole from the pickup, or if he had climbed the pole and returned to the pickup, he would have walked within several feet of plaintiff as he was working on the meter and could have seen him.

Cecil Watson, for defendants, testified that the truck did not hit plaintiff; “Mr. Jimmy” pulled out to the left. Watson was. standing within five feet from where plaintiff worked. Cozort was on the ground when he saw him; he never did see Cosort up the telephone pole. He further testified that he had talked to no one about the facts-of the case, but that Ray Blakey came to his house last week and told him he was representing plaintiff and understood he knew something about the occurrence, but he didn’t discuss the case with him — just talked.

Plaintiff’s bill of exception reflects that if Blakey had been allowed to testify as a. witness for plaintiff, he would have stated that he had interviewed Watson at Watson’s home several days prior to trial and questioned him orally about the case; that he had with him a recording machine which-recorded clearly and accurately the conversation between Watson and himself; that such recording had been accurately transcribed upon a typewriter; that the instrument he identified was a direct transcript, word for word, between Watson and himself; that he had with him the recording itself, which could be played and heard by everyone in the courtroom.

Watson, on recall, again testified that he had talked with no one about the case and upon hearing the recording played, testified that he did not recognize his voice thereon, and that he did not make the statements in the recording.

Blakey, thereafter recalled to testify on the bill of exception, testified that Watson was the man he had interviewed and whose conversation he had recorded.

From Blakey’s testimony and the transcribed recording, it appeared that Watson discussed the occurrence of December 1,. 1960, and stated, among other things, that Cozort was up the telephone pole when Watson arrived at the scene; that he saw Cozort get down off the pole, pull off his spurs right in front of his pickup, get in the pickup and start off; that plaintiff was working on the meter all the time Cozort was up the pole; that there was nothing to keep Cozort from seeing plaintiff.

We are of the opinion that the trial court erred in refusing to allow Blakey's testimony. Although Blakey was present during the introduction of some of the testimony, his testimony stands uncontradicted in the record that he was not present at the time Watson testified. Moreover, if Blak-ey was in the courtroom at such time, it does not appear from the record that his presence was with the consent, connivance, procurement or knowledge of appellant or his counsel.

“We are of the opinion that the administration of justice would be better subserved by denying to the trial court the right in any case to refuse to allow the witness to testify. The primary object of judicial investigation is the ascertainment of the truth of the matter under consideration, and a rule which excludes any means by which the truth may be arrived at should not be adopted by the courts.” Johnson v. Cooley, 30 Tex.Civ.App. 576, 71 S.W. 37, n. r. e.

It was with commendable candor and fairness that the trial court, on the bill of exception, made the statement that he was not in a position to say whether Blakey was present at the time Watson testified.

The relative position of defendant’s truck and telephone pole and plaintiff’s place of work compels the conclusion that had Cozort returned from the telephone pole to his truck, as testified to by plaintiff, he would undoubtedly have seen plaintiff’s perilous position in front of his truck. This was a hotly contested fact for the jury’s determination. Even though Cozort had testified that he was aware that his truck had struck plaintiff when he started forward, Watson had denied such fact. Such denial itself could have been expected to weaken the credibility of Watson’s testimony before the jury, and we believe that the additional contradiction of Watson’s testimony by Blakey would have utterly destroyed said witness’ credibility before the jury and greatly weakened Cozort’s. The weak, vacillating conclusion of Chum-ley’s to the effect that he believed, but wasn’t sure, that Cozort climbed the pole, could not be expected to have carried much weight with the jury. Thus, the determination of the credibility of plaintiff versus Cozort and Watson was squarely before the jury. In such circumstance, it is believed that no trial lawyer or judge would gainsay the probable devastating effect on defendant’s case of Blakey’s proffered testimony. The jury should have been permitted to hear Blakey’s testimony, and should not have been denied their prerogative to determine if the voice on the recording machine was indeed Watson’s. Sawyer v. Willis, Tex.Civ.App., 310 S.W. 2d 398. And see I, Texas Law of Evidence, p. 531, Sec. 687.

In all the cases called to our attention where a witness who had violated the rule by being in the courtroom after having been personally placed under the rule, it has been held not to have been an abuse of the court’s discretion to allow such witness-’ material testimony. Holstein v. Grier, Tex.Civ.App., 262 S.W.2d 954, n. r. e., and cases cited therein. Conversely, if, in this case, the trial court had any discretion, which we cannot concede, then it must be held that such discretion was abused by the refusal of the testimony of Blakey who had not even been placed under the rule.

We believe that when a party is denied the benefit of admissible and material testimony of a witness, that such denial so directly and adversely affects the interest of the public generally, as that interest is de-dared by the laws of our State, that the error is practically fundamental. Be that it may, however, we are of the opinion that the error of the trial court in refusing to allow Blakey’s testimony amounted to such a denial of the rights of plaintiff as was reasonably calculated to and probably did cause the rendition of an improper judgment, and that in the interests of justice and fairness the case should be reversed and remanded for new trial.

Other contentions of plaintiff deal with the action of the trial court in submitting three of defendant’s defensive issues containing the word “accident”. Thus, Issue No. 12 was, “Do you find from a preponderance of the evidence that the accident in question, if any, was the result of an unavoidable accident?” Three corollary proximate cause issues were of the same vein; e. g., “Was plaintiff’s failure to keep a proper lookout for his own safety a proximate cause of the accident in question?” None of these corollary issues were reached by the jury because of their negative answers to the primary defensive issues. Plaintiff contends that the use of the word “accident” in these issues constituted a comment by the court on the weight of the evidence by assuming the . occurrence in question was an accident.

As a general position, the use of such phrase would constitute reversible error. However, plaintiff’s affirmative issues, hereinbefore alluded to in the second paragraph of this opinion, were answered unfavorably to plaintiff by the jury. All of these issues were properly submitted, as they were phrased with the use of the word “occasion” instead of “accident”. In other words, plaintiff had already lost his case by such unfavorable findings before the jury had ever reached the defensive issues. We do not accede to the proposition that the complained of issues had any bearing on the answers of the jury to plaintiff’s affirmative issues. Plaintiff’s contentions are overruled with the observation that it would be better practice for the trial court to use the word “occurrence” instead of “accident”.

Plaintiff also attacks the negative findings of the jury as to the negligence of the defendant as being contrary to the weight and preponderance of the evidence. These are questions of fact to be determined by considering the entire record, which we have done. We do not find such answers of the jury to be clearly wrong and manifestly unjust in the present state of the record.

Other contentions of the parties are not likely to arise upon another trial of the case.

Reversed and remanded.

STEPHENSON, Justice

(dissenting).

I respectfully dissent. The witnesses had been placed under the rule in this case at the request of the plaintiff’s attorney. Plaintiff’s attorney had the private investigator, Blakey, present during the course of the trial, to assist in such trial. Plaintiff’s attorney knew he had a tape recording of a conversation, which was nothing more than an ex parte statement, and which would not have been admissible under any circumstances except for impeachment purposes. In spite of this knowledge, plaintiff’s attorney did not have Blakey placed under the rule with the other witnesses. Even though Blakey may not have been present at the time Watson testified, undoubtedly Blakey was present and heard the plaintiff testify that Cozort did climb the pole, and also heard the witness Chumley testify as to such matter. Blakey had the benefit of hearing the testimony that would be bolstered if the witness Watson could be impeached.

The majority opinion does not make it clear to me, and I do not think it will make it clear to trial judges, whether it is holding that a trial judge has no discretion under the circumstances of this case, or that the trial judge abused his discretion in this case. If the majority opinion holds that a trial judge has no discretion under these circumstances, then this is the first case that I have found so holding. Plaintiff cites the cases Holstein v. Grier, Tex. Civ. App. 262 S.W.2d 954, and Johnson v. Cooley, 30 Tex.Civ.App. 576, 71 S.W. 34, in support of his position in this case. It must be noted that neither of these cases goes as far as saying the trial court has no discretion, but each holds the trial court abused its discretion. It is also pointed out that in both the Holstein Case, supra, and the -Johnson Case, supra, the witness whose testimony was excluded had been placed under the rule, and the point is made that the trial court could enforce the rule by contempt proceedings. No such enforcement would have been available in the present case, as the witness had not been placed under the rule. To hold that the trial court has no discretion under these circumstances would, in effect, make Rule 267, Texas Rules of Civil Procedure, meaningless. A litigant could refrain from placing a witness under the rule, let the witness hear the remainder of the testimony and then place the witness on the stand. The witness would not be in contempt of court, and the trial court would be powerless to decide whether the witness should be permitted to testify. Trial courts must be in a position to control the trial of cases in order that justice and equity be done.

On the other hand, if the majority opinion is holding that the trial court abused its discretion, there are other problems to be faced.

A prior inconsistent statement cannot be used as substantive evidence of the truth of the facts stated. The testimony of the witness Blakey and the tape recording of the conversation would not be evidence of any facts stated, and would have no probative value to support any issue in the case. No case has been cited to us, and I have found no cases, in which it has been held that a trial court abused its discretion in excluding impeachment testimony where the rule had been invoked, and the witness either had been placed under the rule or had not been placed under the rule.

In addition to this, the plaintiff is faced with Rule 434, T.R.C.P. This plaintiff, in order to be entitled to a reversal, must show that but for the exclusion of such testimony the jury would in all reasonable probability have returned a verdict, other than the verdict it did return. Maddox v. Gulf, Colorado & Santa Fe Railway Co., Tex.Civ.App., 293 S.W.2d 499. I also quote from Missouri-Kansas-Texas Railroad Company v. Wright, 311 S.W.2d 440, as follows:

"Assuming that it would have been proper to have permitted the introduction of the complaint in the Schubert case, rather than denied, the matter of whether such exclusion amounted to reversible error would be controlled by the provisions of T.R.C.P. 434. The Railroad is therefore burdened with the obligation to show that the trial court’s exclusion of the proffered evidence was reasonably calculated to cause and probably did cause the jury to return a verdict contrary to that which would have been returned had the evidence been admitted. This burden has in our view not been discharged.”

A recent decision of this court, passing upon Rule 434, is in part as follows:

Barmore v. Safety Casualty Company, 363 S.W.2d 355, (McNeill, J.):
“Defendant lastly urges that the trial court’s exclusion of Mrs. Bar-more’s testimony was harmless within the purview of Rule 434, Texas Rules of Civil Procedure. In this connection it is stated that plaintiff’s testimony to the effect that he told Hoke of the accident, which was not denied, served as contradiction and answer to the testimony produced by defendant. We must measure the error by the test: Did it amount to such a denial of appellant’s rights as was reasonably calculated to cause and probably did cause the rendition of an improper judgment? Much consideration has been given this question. Who can say what effect the tendered testimony may have had upon the jury? Would the jury have attached more weight to what plaintiff had testified if his wife had been allowed to tell that he told her he had been hurt. Her testimony would not have been that he got hurt — which was the question directly in contest; it would have been proof of a secondary nature — that he told her he got hurt. Thus her testimony rested directly upon her husband’s. The primary fact of injury must rest squarely upon plaintiff’s own testimony as there were no other witnesses present. Thus his veracity alone in the final test was at issue. His wife’s testimony, if allowed, may have been sufficient to cause the jury to have decided that he had gotten hurt. But we cannot say that it probably did cause the rendition of an improper judgment.”

In this case I would hold first that the control of witnesses under the circumstances of this case, [that is, the rule has been invoked, a witness not placed under the rule hears all or a part of the testimony and is then called to testify,] lies within the sound discretion of the trial court. I would further hold that the trial court did not err in refusing to permit the witness Blakey to testify, as such refusal was not an abuse of its discretion.

I also would hold, even though the majority opinion holds such refusal to be error, that it is not harmful error under Rule 434, T.R.C.P.

      (1. Italics ours throughout.)


author: CHAPMAN, Justice.

text:
    GLOBE INDEMNITY COMPANY and United States Fidelity and Guaranty Company, Appellants, v. G. C. FRENCH et al., Appellees.
    No. 7370.
    Court of Civil Appeals of Texas. Amarillo.
    June 15, 1964.
    Rehearing Denied Oet. 19, 1964.

      Crenshaw, Dupree & Milam, Lubbock, for appellants.
    Brock, Wright, Waters & Galey, Lubbock, for appellees.
   CHAPMAN, Justice.

Prior to December 8, 1961, a policy of insurance was issued by United States Fidelity And Guaranty Company to Richard Rockwell, as named insured, which contained a provision that the insurance would cover “any person using such automobile, provided the actual use thereof is with the permission of a named insured.”

Also prior to said date a family automobile policy of insurance was issued to G. C. French, father of Larry French. That policy provided, with respect to a non-owned automobile, that the insurance would cover “any relative, but only with respect to a private passenger automobile or trailer, provided the actual use thereof was with the permission of the owner.”

Richard Rockwell, Gary McCauley and Larry French were students in Texas Tech in December of 1961. On December 8 that year Richard Rockwell loaned his 1957 Chevrolet automobile to Gary McCauley to take his date to a dance that night. Mc-Cauley double-dated with Larry French. While McCauley and his date were dancing later in the evening, French took his date back to her dormitory in the Rockwell automobile in order to get her to her room within the time required by the rules of the dormitory. On the way back from the dormitory to the dance he ran into some parked automobiles, causing damages for which he was later sued. He was also sued by Rockwell for damages to his automobile, which Rockwell claimed he was using without permission.

G. C. French, individually and as next friend of his son, Larry, filed this suit seeking a Declaratory Judgment finding that the coverage of the named insurance policies extended to- Larry French under the omnibus clauses therein, on the theory that Larry French was driving the automobile of Richard Rockwell with his implied consent. The trial court rendered judgment to the effect that on the occasion in question Larry French had the implied consent of Richard Rockwell to drive his automobile; and was, therefore, covered by both policies. Appeals are perfected by both insurance companies from such judgment, which appeals contend there is no evidence to support the finding that French had the implied consent of Rockwell. All parties admit he did not have his express consent. There appears to be no Texas authority directly in point on the questions raised by the facts of this case.

Gary McCauley and Richard Rockwell were close friends, having known each other for fourteen years and having been in the same classes in school in Weatherford. McCauley did not have an automobile at school and Rockwell had loaned him his on several occasions prior to the one under consideration. French and McCauley lived just across the hall in the same dormitory. Rockwell lived in another dormitory on the campus. French testified he met Rockwell about six weeks before the accident. Rockwell testified he did not remember ever meeting French until Tuesday before the accident, though he knew when he loaned McCauley his car on December 8 that French was going to double-date with him. He did not even know if French had a driver’s license, there was not anything said about French driving the car and he did not know he was going to drive it. When asked on cross examination if he had ever made any restrictions on McCauley to the effect that he was the only one to drive the car when he loaned it to him, he testified: “I’ve never told him that, but I figured he understood that since I had loaned him the car.”

He also testified he knew McCauley drank some and had driven when he was drinking. He was then asked if he did not know that McCauley might get himself in shape that someone else might have to drive the car. He replied: “No sir.”

McCauley testified that when they reached the dance he was driving and French and his date were in the back seat. He said he never had given him permission to drive the car. That fact was disputed by French. It is without dispute that French was not present when McCauley made arrangements for using Rockwell’s car and that nothing was said either way with respect to the driving being limited to McCauley. French was with McCauley when he secured the keys from the owner and Rockwell handed them to McCauley.

Since this is a first impression case in Texas, we must look to the textual statements by recognized authorities and to decisions of other jurisdictions. In reading decisions from other states we find considerable lack of agreement. For example, in Appleman, Insurance Law and Practice, Vol. 7, Sec. 4366, page 308, the writer, after suggesting in effect that some states apparently feel that an automobile liability insurance contract is as much for the benefit of the public as for the named or additional insured, then states:

“These states have arbitrarily adopted a doctrine that if the vehicle was originally entrusted by the named insured, or one having proper authority to give permission, to the person operating it at the time of the accident, then despite hell or high water, such operation is considered to be within the scope of the permission granted, regardless of how grossly the terms of the original bailment may have been violated.”

Though not in point on our particular question, a case involving an employer-employee relationship in the use by the employee of a company truck, where he deviated from the scope of his permission, the San Antonio Court of Civil Appeals has suggested that Texas takes a stand between the strict and liberal rules on extended coverage. Olgin v. Employers Mut. Casualty Co., Tex.Civ.App. 1950, 228 S.W.2d 552. Though we believe it cannot be determined what position Texas will take under a situation such as we have until our Supreme Court writes on the question or stamps a “writ refused” on the opinion of some intermediate appellate court, we feel confident that our Supreme Court will not take the “hell or high water” position mentioned in Appleman, supra.

In a case involving a situation very similar to our own the United States District Court of New Hampshire has held the insurance coverage did not apply to Summers, a Dartmouth College student, who took the car of his friend, Melville Straus, without his permission, even though Straus testified that if Summers had asked for permission to use it, he would probably have granted it and even though the record showed a general custom at Dartmouth whereby students loaned their cars to one another. Fireman’s Fund Insurance Company v. Brandt, D.C., 217 F.Supp. 893.

Where an employee driver was the guest in the home of his employer and had a collision while driving his employer’s small truck without his expressed consent, an intermediate appellate court of Kentucky said:

“ * * * there can be no implied permission by reason of the relationship where an employee or guest or other person occupying a similar association takes the car and uses it for the first time.” United States Fidelity & Guaranty Co. v. Brann, 297 Ky. 381, 180 S.W.2d 102.

The United States District Court of North Dakota, Southwestern Division, in Sunshine Mutual Insurance Co. v. Mai, 169 F.Supp. 702 has held:

“In order to support an inference that one had the implied permission to use the assured’s automobile for his own pleasure and purposes, there must be evidence tending to show a course of conduct or practice known to the owner and acquiesced in by him or by someone having authority to give permission.”

In Main v. Cameron, 13 Wis.2d 15, 108 N.W.2d 142, the Supreme Court of Wisconsin, in a case involving college students and a former student who were good friends, held against the theory of implied consent because “there were no circumstances or conduct occurring before Cameron took the car [Main’s car] from which permission could be implied.”

The text writer in Appleman, Insurance Law and Practice, Vol. 7, Sec. 4365 at page 303 states:

“An implied permission * * * is not confined to affirmative action, but means an inferential permission, in which a presumption is raised from a course of conduct or relationship between the parties in which there is mutual acquiescence or lack of objection signifying consent. It has also been stated, however, that the term ‘permission’ contemplates something more than mere sufference or tolerance without taking steps to prevent, and the term is used in the sense of leave, license or authority with the power to prevent. "Such implied permission is usually shown by usage and practice of the parties over a period of time preceding the day upon which the insured automobile was being used * * ” (Italics added).

Appellee argues in effect that since Rockwell knew French was double-dating with McCauley, it is only realistic to assume that he had the implied permission to drive the vehicle on the occasion in question. By the process of such reasoning we would then have to extend the implied consent to the girls involved in the dates regardless of the owner’s knowledge of their driving abilities or even of their possession of a driver’s license.

Rockwell testified he did not even know if French had a driver’s license. He did not remember having even met French before Tuesday preceding the Friday dance. They could not have been called friends from the record here made and were not fraternity brothers. There had been no course of conduct or relationship between them to indicate mutual acquiescence and no usage or practice of the parties over a period of time preceding the day upon which the insured automobile was being used. Therefore, to affirm the judgment of the lower court we would in effect be holding that when a college student loans his car to a friend of long standing all other students riding in the car have his implied permission to drive it regardless of his knowledge of their habits or regardless of his previous relationship with them. This court is not willing to extend the doctrine of implied consent that far until higher authority requires us to do so.

There is no indication that the evidence upon another trial would be any different. Accordingly, we hold that Larry French was not within the coverage of either of the named policies of insurance, since he was driving the automobile in question without permission, express or implied, of the owner of the automobile.

The judgment of the trial court is reversed and rendered.