author: DIXON, Chief Justice.

text:
    Dr. Edward L. EVANS et al., Appellants, v. CITY OF CEDAR HILL et al., Appellees.
    No. 15951.
    Court of Civil Appeals of Texas. Dallas.
    March 2, 1962.
    Bonney, Wade & Morgan, Dallas, for appellants.
    Warwick H. Jenkins, Waxahachie, for appellees.
   DIXON, Chief Justice.

Appellants, Dr. Edward L. Evans and more than sixty other persons, all owners of property in the City of Cedar Hill, Texas, brought suit against the City and its officials, appellees, to enjoin the City from proceeding further with the collection of ad valorem taxes for the year 1960. Appellants alleged that appellees had pursued a “deliberate, systematic, arbitrary, fraudulent and unlawful plan, scheme and cause of action to impose unequal taxes in violation of Art. 8, § 1 of the Constitution of Texas [Vernon’s Ann.St.]”.

More particularly, appellants alleged that the valuations of their properties, substantially all of which are "rural farming lands,” were vastly increased over the valuation for the preceding year, the increase in some instances being more than 100%, and in every instance being grossly in excess of the actual market value of said lands. Further they alleged that in every instance the valuation for 1960 was disproportionate to the valuation placed on other tracts of land owned by other persons.

Appellants asked for both a permanent and temporary injunction and a day was set for a hearing on the application for the temporary order. Their prayer for injunction was quite broad in its scope. We quote material parts of the prayer:

" * * * that this court issue its most gracious temporary injunction enjoining said defendants and each of them, their agents and successors from taking any steps whatsoever during the pendency of this cause toward the collection of 1960 ad valorem taxes, including but not limited to the assessment of or collection of taxes, penalties or interest, the filing of suits to impose or enforce a tax lien upon the property of the plaintiffs and that such temporary injunction further enjoin said defendants from making any payment for (sic) from incurring any obligation to make any expenditures or payment of any proceeds from any 1960 ad valorem taxes and specifically from the issuance or sale of any bonds for which any portion of the proceeds of 1960 ad valorem taxes is to be used in payment of interest or repayment of principal and specifically from taking any further steps whatever toward the collection of 1960 ad valorem taxes from the plaintiffs herein. Plaintiffs further pray that upon final hearing such injunction be made permanent * *

Meantime appellees filed a motion to dismiss appellants’ cause of action, and in the alternative, a plea in abatement. As grounds for their pleas appellees alleged that (1) appellants’ suit was too late, having been filed “after the 1960 taxes had all been assessed, equalized, officially approved, placed on the tax roll, and a substantial majority of them collected”; (2) the injunction would not maintain, but would disturb the status quo; (3) appellants did not plead a lack of an adequate remedy at law, though they have such a remedy in that Art. 7329, Vernon’s Ann.Civ.St. expressly provides that as a defense to a tax suit it may be shown that the taxes sued for are in excess of the limit allowed by law; (4) appellants did not come into court with clean hands since they did not allege or agree to pay any amount of taxes correctly due, but have demanded a 100% cancellation of all their taxes.

Sometime before the hearing appellants tendered into and paid into the treasury of the court sufficient money to pay their assessed taxes. It is to be noted this money was not tendered or paid to the City Tax Collector. It was paid into the treasury of the Court to await the outcome of the litigation.

On January 31, 1961 the Court entered an agreed order for a temporary injunction. Since the interpretation and scope of this agreed order are matters of controversy, we deem it appropriate to quote the material parts of the order:

“Wherefore, it is Ordered, Adjudged and Decreed that the defendants and each of them be enjoined during the pendency of this suit and until the final judgment is herein entered from filing any suit; in any courts against these plaintiffs or any of them arising from claims for 1960 ad valorem taxes other than a cross-action or actions in this suit, but it is specifically ordered that the defendants may jointly and severally file such cross-actions as they may see fit, claiming the funds deposited in the Registry of this Court by the plaintiffs and claiming such liens upon the lands of the plaintiffs which are the subject of this suit, which may be necessary to satisfy any tax liability for the year 1960 against such lands to the extent that such fund paid into the Registry of this Court by the Plaintiffs do not pay such tax liability; all such cross-actions, if any, which shall be filed shall be tried at the same time that the plaintiffs’ action herein is tried.
“All other prayers for injunctive relief are denied pending final hearing hereof.
“W. L. Jack Thornton /s/ “JUDGE.” '

On February 17, 1961 the court entered its order sustaining in part appellees’ motion to dismiss. It is from this order that appellants have undertaken the present appeal. Since this document is even more controversial than the other, we quote the ordqr in its entirety:

"On the 31st day of January, 1961, came on to be heard Defendant’s Motion to Dismiss Plaintiffs’ First Amended Original Petition herein and the Court having heard the arguments of counsel with respect to such motion and having considered the evidence before it and the law on the matter and being of the opinion that under their pleadings in this cause and under the law Plaintiffs are not entitled to any in-junctive relief of any nature herein save only that which is specifically recited in the second paragraph of this Court’s order of January 31, 1961, entered in this cause relating to Plaintiffs’ application for a temporary injunction.
“THEREFORE be it ordered, adjudged and decreed by the Court that Plaintiffs be and they are hereby denied all prayers for injunctive relief, either temporary or permanent in nature, save only those specified in the second paragraph of this Court’s order entered in this cause on January 31, 1961 which provides that pending final judgment herein defendants are enjoined from filing any suit in any court against plaintiffs arising from claims for 1960 ad valorem taxes being protested by Plaintiffs other than by cross-action or actions in this cause and Plaintiffs’ Petition is hereby dismissed insofar as it seeks injunctive relief in any other respect. The Court reserves further orders on Defendants’ Motion to Dismiss but expressly orders that Plaintiffs’ rights hereafter shall be limited to their contest of the taxes alleged to be unlawful as to the named Plaintiffs, individually, and Plaintiffs are expressly denied all relief prayed for by them which in any way may hamper defendant City in its normal operation, as in the issuance and sale of any bonds heretofore approved by the qualified voters of the City, and this cause shall in no way involve the right or authority of the defendant City to issue and sell such bonds or incur obligations or make expenditures in the normal operation of its business affairs.
“Rendered and entered the 17th day of February, 1961.
“W. L. Jack Thornton /s/ “Judge Presiding.”

On February 27, 1961 appellants filed a motion asking the court to set aside its order of February 17, 1961 dismissing part of their cause of action. For grounds appellants alleged that the order was entered without their knowledge and consent, and without notice to them; that the only evidence heard at the hearing on January 31,. 1961 was evidence in regard to their application for temporary injunction; and that the order of February 17, 1961 is an unwarranted modification and enlargement of the agreed order of January 31, 1961,. which modification and enlargement was made without a hearing.

On March 3, 1961 appellees filed a written answer to appellants’ motion to set aside the order of February 17, 1961. In their answer they alleged that the order was entered after the court had heard evidence and argument both as to appellants’ application for temporary injunction and appel-lees’ motion to dismiss and that the court had so informed attorneys during the hearing.

Thereafter the court overruled appellants’ motion to set aside the order of February 27, 1961. We quote material parts of this order:

“On this 3rd day of March, 1961,. came on to be heard the motion o£ plaintiffs, Dr. Eward L. Evans, et alto set aside the Order On Defendants” Motion to Dismiss heretofore entered; herein on February 17, 1961, and all. parties having had reasonable notice-of such motion and hearing and. the-Court having heard the argument off counsel thereon and having considered said motion and the answer of defendants, City of Cedar Hill, et al., thereto, and having found that the law and the facts are with the defendants, as shown by the pleadings, the record, and as set forth in the answer of the defendants to plaintiffs’ motion, is of the opinion that said motion should be overruled;

Appellees have filed in this Court a motion to dismiss appellants’ appeal, the grounds being that the order of February 17, 1961 is neither a final judgment nor an interlocutory order of the kind which is appealable. We believe that appellees are correct and that the appeal should be dismissed.

The court by its order of February 17, 1961 dismissed only part of appellants’ cause of action. The temporary injunction of January 31, 1961 was expressly continued in effect. The matters covered by the said temporary injunction were not included in the order of dismissal. Thus unimpaired was the court’s order that the right of the City to file tax suits against appellants be limited to the filing of cross-actions in this suit and that appellants’ cause of action be limited to their contest of taxes alleged to be unlawful as to the named plaintiffs, appellants here.

The parts of appellants’ cause of action which were dismissed relate to their suit for injunction to restrain the City from “taking any steps whatsoever toward collecting 1960 taxes” including other property owners than appellants; and their suit to restrain the City from “making any obligation to make any expenditures or payment of any proceeds from any 1960 ad valorem taxes and specifically from the issuance or sale of any bonds for which any portion of the proceeds of 1960 ad valorem taxes is to be used in payment of interest of repayment of principal * *

Left undetermined are issues pertaining to each appellant with reference to excessive and unequal valuations of his property.

Appellants contend that the order of February 17, 1961 modified the temporary order of January 31, 1961, therefore under Art. 4662, V.A.C.S. and Rule 385, Texas Rules of Civil Procedure is appealable, though it is an interlocutory order. It is our opinion that the order of February 17, 1961 does not modify the order of January 31, 1961. On the contrary the later order expressly excepts the matter covered by the earlier order from the effects of the dismissal.

Appellants further say that the hearing on January 31, 1961 was on their application for temporary injunction only and was not concerned with appellees’ motion to dismiss. But in his order of February 17, 1961 the trial judge made recitations directly to the contrary. No statement of facts was included in the record before us on appeal. So we must presume that the order is supported by the evidence. Moreover, appellants sought to incorporate certain factual allegations in a bill of exceptions, but the purported bill appears in the record unsigned by the trial court.

Since the order of dismissal of February 17, 1961 disposed of only a part of appellants’ cause of action, leaving some issues undetermined, it is not appealable as a final judgment. Hargrove v. Insurance Inv. Corp., 142 Tex. 111, 176 S.W.2d 744; 3 Tex.Jur.2d 358. Further, it is not within the class of appealable interlocutory orders. See Arts. 2008, 2250, 2251 and 4662, V.A.C.S.; also Rule 385 T.R.C.P.; 3 Tex. Jur.2d 359.

The appeal is dismissed.


source: Caselaw Access Project

author: POPE, Justice

license: Public Domain

text:
    Marvin RUBIN, Appellant, v. Frank J. SKURKA, Appellee.
    No. 13899.
    Court of Civil Appeals of Texas. San Antonio.
    March 14, 1962.
    Glosserman, Alter & Smith, Mitchell S. Rosenheim, San Antonio, for appellant.
    Lieck & Lieck, San Antonio, for appellee.
   POPE, Justice

Frank J. Skurka sued Marvin Rubin, his employer, for back wages and recovered $1,000.00. The jury found that Rubin had agreed to pay Skurka at the rate of $175.00 per week if Rubin discharged Skurka prior to completion of a year’s employment. Rubin did discharge Skurka. Rubin complains that the court erred in sustaining an exception to his answer which pleaded that Skurka was discharged for cause. The court correctly sustained the exception, because it is no defense to a suit for back wages that the employee was discharged for cause. Sooner Broadcasting Company v. Grotkop, Okl., 280 P.2d 457 ; 56 C.J.S. Master and Servant §§ 87, 89, 92.

The judgment is affirmed.


author: STEPHENSON, Justice.

text:
    Jim STAFFORD, Appellant, v. FIREMEN’S AND POLICEMEN’S CIVIL SERVICE COMMISSION OF the CITY OF BEAUMONT, Texas, Appellee.
    No. 6530.
    Court of Civil Appeals of Texas. Beaumont.
    March 1, 1962.

      M. Herbert Oldham, Beaumont, for appellant.
    Keith, Mehaffy, McNicholas & Weber, George Murphy, City Atty., Beaumont, for appellee.
   STEPHENSON, Justice.

This case arises under the Firemen’s and Policemen’s Civil Service Act, which is in effect in the City of Beaumont, Texas. Appellant was Inspector of Detectives of the City of Beaumont. The Chief of Police suspended appellant indefinitely and he appealed to the Civil Service Commission. This matter was heard by the Commission and an order was entered permanently discharging appellant from which he appealed to the District Court. Following a hearing before the trial court, a judgment was entered confirming the dismissal of appellant.

The order of indefinite suspension gave two primary reasons for such action. The .first was “Neglect of Duty” in failing to •make arrests and file complaints for the offenses of prostitution, and keeping and controlling a bawdy house. The second rea•son was “Conduct prejudicial to good order” ■in suggesting to two young detectives that they have intercourse with prostitutes during the course of a visit to a house of prostitution.

All of the testimony shows that on the particular occasion in question, appellant and two young detectives went to the Marine Hotel in the City of Beaumont. The madame and the girls were questioned and their health cards were checked. The evidence showed, without question, that this was a house of prostitution. No arrests were made, and no complaints were filed. Appellant contends that inasmuch as no “action” took place in their presence, that there was no violation of any law in their presence, and therefore he could not make an arrest nor file a complaint. Appellant also contends that he had received orders from the Chief of Police Mulligan not to make arrests for prostitution. Mr. Mulligan testified before the trial court and his testimony is conflicting in that on direct examination he said he had instructed appellant to check the houses of prostitution but not to make any arrests, and then on cross-examination he said that he told appellant during the fall of 1959 to close these houses of prostitution and to keep them closed and that this order was never countermanded.

The law imposed a duty upon appellant under Article 609 of the Penal Code of the State of Texas to make complaints under oath of all vagrants in his knowledge. A prostitute is specifically named as a vagrant under Article 607 of the Penal Code, Vernon’s Ann.P.C. art. 607. This is an obligation placed upon a peace officer by the law of this state and anyone failing to comply is subject to removal regardless of instructions from a superior officer. Appellant’s failure to file complaints against these prostitutes was a “Neglect of Duty”.

Appellant testified that he did not make a suggestion to the two detectives “that they have a girl on the house.” The two young detectives testified unequivocally that this suggestion was made by appellant two or three times. The counsel of appellant states that if the suggestion was made, it was purely in jest. A question of fact was raised by the testimony, both as to whether the statement was made, and if made whether it was made in jest. These were questions ' of fact for the Civil Service Commission to determine, which they did, adversely to appellant. The Commission found that this was “Conduct Prejudicial to Good Order.”

The trial court and this court are "both governed in this type of suit by the substantial evidence rule. Fire Department of City of Fort Worth v. City of Fort Worth, 147 Tex. 505, 217 S.W.2d 664. The Court may not substitute its findings for the decision of the Commission. Kavanagh v. Holcombe, Tex.Civ.App., 312 S.W.2d 399. There was substantial evidence to reasonably support the decision of the Civil Service Commission.

The judgment is affirmed,


author: MASSEY, Chief Justice.

text:
    NATIONAL CREDIT CORPORATION, Appellant, v. Charles MAYS, Jr., Appellee.
    No. 16300.
    Court of Civil Appeals of Texas. Fort Worth.
    March 2, 1962.
    Rehearing Denied April 6, 1962.
    Henry Stollenwerck, Dallas, for appellant.
    Mays & Mays and Richard E. Johnson, Fort Worth, for appellee.
   MASSEY, Chief Justice.

This is a trespass to try title case. Plaintiff National Credit Corporation sued defendant Charles Mays, Jr., to oust him from title and possession of a certain parcel of property in Tarrant County, Texas, being a part of a 110 acre tract in the M. Lynch Survey. There is no question but that the defendant’s title was good unless it be that the mechanic’s lien, under and by virtue of which the plaintiff’s title was purportedly derived, and which was prior in time as applied to the title of the defendant, met the requirements of the Statute of Frauds.

Judgment was for the defendant and the plaintiff appealed.

Judgment affirmed.

The fact that the owner of the property was a Tarrant County resident appeared on the face of the mechanic’s lien. The property as to which the lien was stated to have been given was: “Lot #2, Block 4 A, M. Lynch Adtn., Abstract #953, Route 1, Box 662”. The instrument was executed in Dallas County, Texas, but was filed of record in the office of the County Clerk of Tarrant County, Texas.

The foregoing constituted the whole of the description in the title instrument. Plaintiff tendered evidence before the court to demonstrate that a surveyor acquainted with property in Tarrant County was able to find the land. The Surveyor testified that there was no M. Lynch Addition in Tar-rant County, but due to his familiarity with land in the county he was instantly aware that it must have been the M. Lynch Survey to which the lien instrument had relation. Further, he stated that he was acquainted with the fact that there was an addition or subdivision for sales and promotional purposes which had been drawn by the Sloan Lumber Company; that it appeared in Abstract 953, and that the map or plat of the subdivision or addition could be found in the files of the Tax Assessor-Collector of Tarrant County. By reference to said map or plat, he found that there was no “Lot 2, Block 4A” therein, as the subdivision was divided into only two Blocks. In each block, however, was to he found a lot numbered “4A”. By reference to the name of the owner who had executed the lien, he was able to determine that such owner had formerly held title to the “Lot 4A” in “Block 2”. At this stage he had no trouble locating the property on the ground. He testified that such could not be done if one were confined to the description and the records of the County Clerk.

Testimony was received from an employee in the Tarrant County Tax Office which was of similar import relative to the presence of the information made available to the surveyor in the office files.

Testimony was introduced from a rural mail carrier to the effect that given the Fort Worth address of Route 1, Box 662, he could readily locate the property in question and knew it to have designated the former address of the owner of the property who gave the lien. Other towns in the area have a rural “Route 1” on which postoffice deliveries are made. Two neighbors of such former owner testified that they were familiar with the property and readily located it.

Plaintiff rested its case. Defendant offered no evidence.

We do not believe that such evidence as was received in the trial court may be accorded probative force.

The latest authority on the question herein presented is that of Jones et al. v. Mid-State Homes, Inc., Tex.Sup., 356 S.W.2d 923, and reversing Tex.Civ.App., 348 S.W.2d 420. The Supreme Court held in a trespass to try title case that where instruments are offered in evidence by a party in support of his claim to title fail to furnish a nucleus of description sufficient to identify the land claimed they are inadmissible. The court further quoted from its decision in the case of Smith v. Sorelle, 1935, 126 Tex. 353, 87 S.W.2d 703, as follows :

“The rule is well settled that parol evidence cannot be introduced to vary or contradict the descriptive data of a deed. 14 Tex. Jurisprudence, § 251, pp. 1045, 1046. The descriptive words in an instrument should be given a liberal construction, in order that the writing may be upheld, and parol evidence is admitted to explain the descriptive words and to identify the land; but the instrument itself must contain a nucleus of description. The parol testimony must directly be connected with the descriptive data, and when more than this is required, the description is insufficient. 14 Texas Jurisprudence, § 204, pp. 992, 993, and authorities cited.”

The reasoning of the plaintiff in this particular case is that it may properly be presumed that the location of the land was in Tarrant County; that since there is an “M. Lynch Survey” in Tarrant County, but no “M. Lynch Addition to the City of Fort Worth, Tarrant County, Texas”, that it may be presumed that “M. Lynch Survey” was meant; that since there was in fact a subdivision map of the Sloan Lumber Company which contained information showing lots and blocks thereof within the M. Lynch Survey (albeit the same was not of record in the office of the County Clerk), that it may be presumed that the premises claimed by plaintiff were located in the subdivision; and that since there was no “Lot Number 2, Block Number 4A”, but there was a “Lot 4A, Block 2” shown on the map of said subdivision, that it may be presumed that “Lot 4A, Block 2” was meant to have been stated. Thus the plaintiff, through a series of inferences drawn from the words used in its instrument of title, arrives at the conclusion that the parol evidence introduced is admissible and proper to be considered to explain the descriptive words and identify the land.

The writer has always accorded great weight to the reasoning of Chief Justice Stayton in the case of Smith v. Crosby, 1893, 86 Tex. 15, 23 S.W. 10, 40 Am.St.Rep. 818. Therein he reasons that it is necessary for the law to condemn transactions purportedly conveying land where the land description is not given with sufficient particularity that it would be safe to apply extrinsic evidence to the description for the purpose of locating the land on the ground; that unless there be at least a general, though accurate, designation of the land by which the extrinsic evidence is controlled then extrinsic evidence might operate to convey property when there was no intention expressed by the written instruments to convey it.

In Rowson v. Rowson, 1955, 154 Tex. 216, 275 S.W.2d 468, Chief Justice Calvert stated that the description necessary to meet the requirements of the Statute of Frauds cannot be arrived at from tenuous inferences and presumptions of doubtful validity, especially where the same writing gives rise, with equal validity, to conflicting inferences and presumptions that lead away from the subject matter of the contract.

There having been no M. Lynch Addition in Tarrant County, and indeed not even an official Sloan Lumber Company’s Addition or Suddivision in the M. Lynch Survey of the county, it would seem certain that any resort to extrinsic evidence would necessarily be to supply the location or description of the land and not to merely identify such land from the data in the instrument. This is inhibited by the law. Wilson v. Fisher, 1945, 144 Tex. 53, 188 S.W.2d 150.

Judgment is affirmed.


author: YOUNG, Justice.

text:
    Dr. Bernard SCHNITZER et al., Appellants, v. SOUTHWEST SHOE CORPORATION, Appellee.
    No. 15,946.
    Court of Civil Appeals of Texas. Dallas.
    Jan. 26, 1962.
    Rehearing Denied Feb. 23, 1962.

      Saner, Jack, Sallinger & Nichols and Robert F. Ashley, Dallas, for appellants.
    Rosenfield, Berwald & Mittenthal, Dallas, for appellee.
   YOUNG, Justice.

The appeal is from grant of a temporary injunction. Upon filing of a $2,000 bond by appellee tenant, appellants were enjoined from forfeiting a lease on premises located on Garland Road, Dallas, for failure to pay rent to lessor Schnitzer, conditioned that appellee would make the payments into registry of court during pendency of suit. At request of appellants, it was ordered that the temporary injunction might be superseded by their filing supersedeas bond in sum of $10,000 which appellants did not furnish, but instead have filed a cost bond for appeal.

Appellants assert error of trial court in grant of the temporary restraint; (1) because the undisputed evidence shows that the defendants are able to respond in damages and that plaintiff has an adequate remedy at law; and (2) because plaintiff’s petition showed on its face that plaintiff, is seeking to enforce the terms of an agreement which is void as in violation of the Anti-Trust Laws of the State of Texas. Appellee’s answering points in substance are reflected in counterpoints three and four that “where the evidence showed that the appellants had breached a restrictive covenant in a lease contract, the trial court did not abuse his discretion in the grant of temporary injunction to preserve the status quo”, and “that the terms of the restrictive covenant sought to be enforced was not in violation of Texas Anti-Trust Statutes.”

Defendant Schnitzer and his father-in-law Sol Alpard were owners of adjoining business buildings on Garland Road in a new area being developed as a shopping center. On January 14, 1959 Schnitzer had entered into a five-year lease and renewal option of his premises to appellee Southwest Shoe Corporation to be occupied as a shoe store, the consideration by lessee to be $39,000 payable $650 per month beginning July 1st, 1959. Said lease contained a provision that in case of default in performance thereof, same could be forfeited at discretion of lessor and lease declared at an end with repossession on terms then detailed. Paragraph #14 of the lease was a provision headed “EXCLUSIVE OCCUPANCY” and stipulating: “It is understood and agreed by the parties hereto that the LESSEE is to have an exclusive on the operation of a shoe store, and soft goods ready to wear store, subject to the herein-below exceptions, in this particular group or units of this shopping service center owned by the LESSOR and those joining him in the ratification of this exclusive occupancy throughout the primary term and option period of this lease:

“(1) Department store
“(2) Robert Hall Type Store
“(3) Mayfair Type Store
“(4) Children’s Specialty Shop
“(5) Variety Store

Notwithstanding the above set forth exceptions to an exclusive shoe store and soft goods or ready to wear store, the LESSOR shall at all times have the exclusive right of sale in this shopping center of any and all shoes.” At end of lease contract it was recited “Ratification of Exclusive Occupancy” signed by Sol Alpard and the instrument then being acknowledged by both defendants.

Defendants Schnitzer and Sol Alpard testified: The latter, that they owned both contiguous buildings, one of which Schnit-zer had leased to appellee as above stated; that both were interested in development of the area as a shopping center and for that purpose had entered into a common plan for its development; also that he was interested in protecting Dr. Schnitzer’s tenants in their exclusive occupancy, it being for the interest of the whole center. Alpard had leased his adjoining premises to Lee Carpet Company and a few weeks after appellee had gone into possession of the lease, Lee Carpet Company with permission of Alpard had subleased a unit of same to Frank Green for conduct of an “outlet” or Army Store, engaged among other things in selling shoes. In this connection, Mr. Alpard testified that he had not consulted with appellee before giving Lee Carpet Company the written permission to sublease or notified Green, the subtenant, that he could not sell shoes as a part of his business operation, which admittedly he was doing. Concerning his solvency, this witness stated that it would take considerable time to list his properties, describing them generally but not as to any indebtedness against the same.

Dr. Bernard Schnitzer, defendant, likewise testified to the agreement with Alpard to operate their shopping center as one integral unit; that one of the conditions imposed by appellee was the covenant for exclusive occupancy and not to permit any tenant of the center to sell shoes other than lessee; that he had talked with Lee Carpet Company about the subletting, not advising Lee that he could not sublet to any one selling or offering to sell shoes on the premises. Schnitzer later received a letter from attorneys for appellee calling attention to the lease infraction, and requesting that the matter be corrected; he consulting Lee Carpet Company but could accomplish nothing; being otherwise disposed to release appellee from terms of his lease. Dr. Schnitzer testified that except for the temporary injunction he would have taken steps to forfeit appellee’s lease; that it was not .satisfactory for the monthly rentals to be paid into registry of court, he needing that money “to amortize my buildings”; his only property consisting of his home and business homestead.

Joseph Brown was president of appellee corporation. He testified to having been in the shoe business for many years, with six stores, and advertising extensively in newspapers and over the radio; that he was familiar with the value of an exclusive lease, it being his opinion that the reasonable value of the lease in question, if not an exclusive one, would be $350 per month, whereas he was obligated to pay $650 per month on basis that it was exclusive and that he would not have made the lease except for that reason; this same subtenant now selling certain brands of shoes handled by appellee and that the effect of such competition was to lessen plaintiff’s sales; that he was one of the first tenants moving into the new shopping center which had possibilities of further expansion, he anticipating the option of renewal of lease for another five years; that appellee has paid his monthly rentals into registry of court and will continue to do so until final termination of suit.

While above résumé of material facts has required considerable detail, the restraint involved was simply a requirement that the monthly payments of rental be made into registry of court pending the litigation. During this interval and even under testimony of Dr. Schnitzer, appellee was entitled to protection of his lease against forfeiture; and at the same time defendant Schnitzer could have had the monthly rentals paid over to him direct by furnishing a supersedeas bond instead of the cost bond on appeal which he had chosen to file. So, far from constituting an abuse of discretion, the restraint imposed amounted to no more than maintenance of an appropriate status quo between the parties pending the instant controversy.

Here the appellee has stated a cause of action, with damage of $150,000. Contrary to appellants’ initial point, the evidence is not undisputed of the solvency of Dr. Schnitzer and therefore we disagree with his conclusion that appellee has an adequate remedy at law. In this connection it is stated in 28 Am.Jur. § 56, p. 554 that “insolvency necessarily aggravates the necessity for the protection of the plaintiff’s right by injunction, and will often influence the court to grant an injunction. This does not mean, of course, that insolvency of the defendant is always an essential element of the equity entitling the plaintiff to injunctive relief, for the bill may have equity without regard to the solvency or insolvency of the defendant.”

In point two appellant attacks the restrictive covenant as a violation of the anti-trust statutes. At this juncture we are not concerned with that phase of such contractual provision. In Nelms v. Electro-Ball Co., 157 S.W.2d 681 decided by this Court, a like point was raised by defendant on his appeal from grant of temporary injunction. Judge Looney there stated: “When the case is tried on its merits, in view of the provisions of the statute against trusts and conspiracies against trade, we think it obvious that the decision will largely turn on the legality, whether or not, of the exclusive contracts under which appel-lee operates. We are not required to, nor do we, pass upon that question on this appeal, as the only question presented now is whether or not the court below abused its discretion in granting the temporary injunction, the office of which being simply to maintain the status quo and not to grant relief properly obtainable on final trial.”

Consistent with the conclusions above expressed, judgment of the District Court is in all respects affirmed.

ON REHEARING

Appellants complain of our failure to dispose of their point two — that, after all, the restrictive covenant was in violation of Texas Anti-Trust laws. While this defense was pled neither party offered any evidence with respect to same; treating it in our view as an issue to be disposed of on final trial. We therefore followed Nelms v. Electro-Ball Co., Tex.Civ.App., 157 S.W.2d 681 instead of Clesi v. Northwest Dallas Imp. Ass’n, Tex.Civ.App., 263 S.W.2d 820 where evidence was developed on all issues presented. As appellee observes, whether or not there has been a violation of the Anti-Trust laws raises a question of fact relative to whether the covenant in question tends to unreasonably stifle competition.

The motion is overruled.


author: RENFRO, Justice.

text:
    Benton SINCLAIR, Appellant, v. MACK TRUCKS, INC., Appellee.
    No. 16301.
    Court of Civil Appeals of Texas. Fort Worth.
    March 2, 1962.
    Rehearing Denied March 30, 1962.
    Bagby & Atkins and Bill Atkins, Arlington, for appellant.
    John Ellis, Fort Worth, for appellee.
   RENFRO, Justice.

This is a suit by plaintiff Sinclair to recover for alleged usury interest paid to defendant Mack Trucks, Inc.

On March 26, 1957, plaintiff bought a truck from defendant. Plaintiff paid part cash and executed a note, secured by a chattel mortgage, in the sum of $12,236.76. Included was the amount of $1,436.76 finance charges. The note was payable in 36 monthly installments of $339.91. The interest rate was 8% per annum. During the life of the first note, plaintiff was late in making monthly payments, a total of 1020 days.

On July 1, 1959, at plaintiff’s request, a renewal note in the "sum of $4,166.28 was executed, payable in monthly installments of $347.19, beginning on August 15, 1959. The original acceleration clause was retained in the renewal note.

On August 13, 1959, a third party instituted a suit for the purpose of taking charge of the truck. Plaintiff failed to make payment to defendant on the due date of August 15, and on August 17 defendant’s attorney advised plaintiff, that defendant had exercised the acceleration clause, and unless the “indebtedness” was paid in accordance with said contract defendant would take immediate possession of the truck. On August 19, 1959, defendant informed plaintiff that the “payoff” at that time would be $5,594.97. Defendant abandoned this demand, however, and on August 31 accepted plaintiff’s check in the amount of $4,166.28 and delivered to plaintiff the certificate of title to said truck.

The case was submitted to the court on pleadings, admissions and stipulations. As part of the stipulations defendant submitted its installment ledger and its computations showing that after adding a late charge and an attorney’s fee, and after crediting plaintiff with an interest refund, it had a balance of $71.31 which it was holding for plaintiff and that it had always been ready, willing and able to refund to plaintiff that amount.

The court found that plaintiff was not entitled to recover upon his claim of usury but was entitled to a refund of the unearned interest in the amount of $71.31.

The plaintiff contends that the original and renewal agreements were usurious as a matter of law, that the stipulations show that defendant collected and retained interest in excess of 10 per cent, that judgment should have been rendered for him, and the court erred in allowing defendant an offset of $50.00 attorney’s fees and $2.32 as a late charge. '

The plaintiff contends the acceleration clause has enabled defendant, at its option, to mature the total amount due, including unearned interest, and therefore the interest was usurious as a matter of law.

The notes and chattel mortgage were not included in the stipulations. The stipulations, however, referred to an acceleration clause which permitted defendant to declare the total amount “due thereunder” payable upon default. Clauses which authorize the creditor in case of default to declare due “the principal and interest”, the “whole thereof, principal, interest and attorney’s fees”, or “the principal and all interest accrued thereon” have been held to be not usurious, since such clauses clearly allow the collection of no more than the principal and accrued interest. In Clements v. Williams, 136 Tex. 97, 147 S.W.2d 769, the Supreme Court held: “If the default maturity clause had merely provided for the maturity of the debt, the note would not be usurious because unearned interest could not be collected.”

In Walker v. Temple Trust Co., 124 Tex. 575, 80 S.W.2d 935, the Supreme Court held: “The determination of whether or not usury exists in a contract is a matter involving first and pre-eminently the principle which is the polestar of construction, to wit: The ascertainment of the dominánt purpose and intention of the parties embodied in the contract, interpreted as a whole, in the light of the attending circumstances and the governing rules of law which presumptively they intended to observe and obey in making the contract. * * * It is presumed that in contracting parties intend to observe and obey the law. For this reason the court will not hold a contract to be in violation of the usury laws unless, upon a fair and reasonable interpretation of all its terms, it is manifest that the intention was to exact more interest than allowed by law. ‘In short, the general rule of interpretation and construction of such contracts may be said to be that the contract is not usurious when it may be explained on any other reasonable hypothesis.’ 66 C.J. p. 173. * * * that unless the contract by its express and positive terms evidences an intention which requires a construction that unearned interest was to be collected in all events, the court will give it the construction that the parties intended that the unearned interest •should not be collected.”

In construing the words “amount due”, we hold that in light of the above principles the notes did not, on their faces, provide for usurious interest.

We overrule plaintiff’s contention that the face of the notes shows usury as a matter of law.

The defendant had the right to make bona fide charges in connection with the loans, and such charges did not render them usurious. Hudmon v. Foster, Tex.Civ.App., 210 S.W. 262, reversed on other grounds, Hudmon v. Foster, Tex.Com.App., 231 S.W. 346; C. C. Slaughter Co. v. Eller, Tex.Civ.App., 196 S.W. 704.

The note and mortgage provided for an attorney’s fee of 15% of the amount due if placed in the hands of an attorney for collection. Actually the defendant charged only $50.00 for attorney’s fee. It was not error for the court to allow that amount to be charged against plaintiff’s account. 42 Tex.Jur., p. 935, § 42.

The question of usury is generally one of fact. Andrews v. Hoxie, 5 Tex. 171.

Since the instruments themselves ■did not show usury, the question as to whether usurious interest was collected was a matter for determination by the trier of facts. 42 Tex.Jur., p. 988, § 88; Andrews v. Hoxie, supra.

The trial judge found no usurious interest had been collected. In view of the record, we cannot say he was in error.

Affirmed.


text:
    S. S. STALEY d/b/a Ajax Steel Products Company, Appellant, v. WESTERN STEEL WIRE & PIPE COMPANY, Inc., Appellee.
    No. 16035.
    Court of Civil Appeals of Texas. Dallas.
    Feb. 2, 1962.
    Rehearing Denied March 9, 1962.

      Jay S. Fichtner, Dallas, for appellant.
    Geary, Hamilton, Brice & Lewis, and William C. Koons, Dallas, and Tom M. Seay, Amarillo, for appellee.
   YOUNG, Justice.

The appeal is from an order sustaining the plea of privilege of appellee (defendant).

The suit filed in District Court of Dallas County on April 5, 1961 was on a sworn account. On April 13, defendant corporation of Potter County filed its plea of privilege to be sued in the County of its residence; at the same time filing an answer containing the following: “Without waiving the foregoing plea but still insisting on same and subject thereto.” This plea was patently defective as it was mailed to the District Clerk of Dallas County without signature or verification. On April 19,. 1961 defendant’s attorney mailed to the Dallas County District Clerk another plea-of privilege from Amarillo, Texas, properly signed and verified, together with the following letter: “Dear Sir: By letter dated April 12, 1961, I forwarded you a Plea of Privilege and Answer of Western Steel, Wire & Pipe Company to be filed. It appears that it was mailed to you without being signed by the defendant. Hence, I am enclosing an exact copy of the Plea of Privilege and Answer and ask that it be substituted for the original one sent to you. Your cooperation in this matter is appreciated. With kindest regards, Yours-very truly ./s/ Tom M. Seay.”

On the next day plaintiff had filed a controverting plea to this first or defective plei of privilege which was set for hearing on May 5. Prior to this hearing plaintiff’s-attorney had actual notice of the substituted plea of privilege. On May 5, 1961 the trial court overruled plaintiff’s motion-to strike defendant’s plea of privilege, giving him further time in which to file amended controverting affidavit. The venue-hearing was had on August 11th, 1961 and plea sustained as already stated.

The point on appeal complains of the-court’s action in sustaining the plea because-appellee had waived such plea by previously pleading a defense to the merits through' the filing of a general denial. Appellant’s, argument to that effect is this: the original plea of privilege without signature or verification was without probative effect and a nullity; the general denial filed simultaneously therewith providing merely that it was subject thereto; “that the appellee’s, answer on the merits having been subject to a void pleading was in effect subject to-nothing and therefore became appellee’s general appearance in the case. It constituted, on appellee’s part, a submission to the jurisdiction of the trial court for hearing of the merits of the case in Dallas County, and a waiver of any right to have the case transferred to the county of its residence.”

Appellant refers to the long-settled rule that there are no special appearances in the courts of Texas and that the filing of an answer is a general appearance. St. Louis & San Francisco Ry Co. v. Traweek, 84 Tex. 65, 19 S.W. 370; in Swift & Co. v. Duckett, Tex.Civ.App., 13 S.W.2d 237 it being held that any action on part of the defendant, which invokes general jurisdiction of the court before filing his plea of privilege, unless the right to do so is reserved, constitutes an appearance, and therefore a waiver. In sum, appellant submits that defendant has filed its answer subject to a void pleading, and thereafter sought to file another plea of privilege; that it has patently not complied with the rules of due order of pleading and therefore has waived its venue rights.

Above contention to effect that the filing of a defective plea of privilege constitutes a waiver of the plea fails to -recognize the fact that a plea of privilege may be amended; Rule 66, Texas Rules of Civil Procedure; under Rule 62, T.C.P., the object of an amendment being to “add something to * * * that which has been previously pleaded so as to perfect that which is or may be deficient.” Of the numerous cases to this effect, see Fester v. Locke, Tex.Civ.App., 285 S.W.2d 239 and Everts v. Garlington, Tex.Civ.App., 117 S.W.2d 820, which are directly in point.

Appellant points out however that the April 19th plea was not designated as “an amended plea of privilege” but a ■“substituted” one according to above letter of transmittal. Content of the second pleading controls rather than the caption. McDonald, Texas Civil Practice, Vol. 2. p. 744; and see also Chicago R. I. & T. Ry. Co. v. Halsell, 98 Tex. 244, 83 S.W. 15, holding that a misnamed instrument will be considered according to its contents, rather than ifs title. Accordingly the April 19 plea was by its contents an amendment to the original plea.

Judgment of the trial is affirmed.

ON REHEARING

Appellant calls attention to our statement in original opinion that “prior to this hearing (May 5, 1961) plaintiff’s attorney had actual notice of the substituted plea of privilege.” Such statement is in error and is withdrawn. Appellant correctly states that counsel’s first knowledge of the “substituted” plea was on May 5 upon hearing of his motions to strike appellee’s original plea of privilege and for summary judgment, which motions were then overruled by the court. Hearing on such substituted plea was not heard until some three months later or on August 11, 1961. However, a failure to ask leave to amend, did not render the substituted plea a nullity, the court’s ruling of May 5 adverse to appellant being tantamount to grant of leave to amend said first and defective plea of privilege. Turnbow Petroleum Corp. v. Fulton, 145 Tex. 56, 194 S.W.2d 256; Holt v. Purviance, Tex.Civ.App., 347 S.W.2d 321. While these cases deal with motions for new trial and their amendment, we think that the same -rules of construction would apply to amendment of pleading. Appellant’s motion for rehearing is therefore overruled.

Appellant’s motion to certify questions to Supreme Court is likewise overruled. See 3 Tex.Jur.2d p. 535, § 284.


author: BOYD, Justice.

text:
    Herbert HANCOX, Appellant, v. Russell PEEK, Appellee.
    No. 16302.
    Court of Civil Appeals of Texas. Fort Worth.
    March 16, 1962.
    Rehearing Denied April 6, 1962.
    John Whiteside, Fort Worth, for appellant.
    Russell L. Peek, pro se.
   BOYD, Justice.

Plerbert Hancox appeals from a judgment denying his application for an in-, junction requiring Russell Peek to remove a radiation fall out shelter from its location on Peek’s residential lot, on allegations that the shelter was constructed in violation of city ordinances and building restrictions applying to Peek’s property.

Trial was to the court, and findings of fact and conclusions of law were filed.

The court found:

The shelter was placed in an excavation and was wholly underground, except that a reinforced concrete slab, which covered the excavation, was two or three inches above the ground; the installation began on a Monday or Tuesday and was completed on the following Saturday; appellant knew of the progress of the installation, but made no protest to appellee until after its completion, although he did protest to city officials; the installation is nearer ap-pellee’s property lines than the ordinance and building restrictions permitted, if it be a building or structure within the meaning of those terms as used in the ordinance and restrictions; no damage, monetary or otherwise, was shown to have been sustained by appellant because of the location of the shelter so close to the property lines; the shelter was installed at a cost of $1,950.00; its removal from its present location and its relocation elsewhere on appellee’s lot would cost twice the amount expended for its original installation; any other place on appellee’s lot where the shelter could reasonably be relocated would be nearer appellant’s property than its present location.

The court concluded that the shelter is not such type and kind of building or structure whose location within certain distances of appellee’s property lines is prohibited by the ordinance or building restrictions; that the hardship which would result to appellee if he is required to remove the shelter, compared with any possible damage or inconvenience to appellant is so disproportionate as to require denial of the injunctive relief sought by appellant; and that the installation of the shelter did not constitute a taking of appellant’s property rights.

In Truesdell v. Gay, 13 Gray 311, 79 Mass. 311, it was held that a wall built around three sides of the stack of an iron furnace and a few feet from it, to protect it from earth which might otherwise slide down, was not a building. The court said: “The word ‘building’ cannot be held to include every species of erection on land, such as fences, gates or other like structures. Taken in its broadest sense, it can mean only an erection intended for use and occupation as a habitation or for some purpose of trade, manufacture, ornament or use, constituting a fabric or edifice, such as a house, a store, a church, a shed.”

The nearest approach to an authority which we have found is Small v. Parkway Auto Supplies, 258 Mass. 30, 154 N.E. 521, 49 A.L.R. 1361, where it was held that gasoline pumps, under ground gasoline tanks, and pits with concrete sides, inclosed by concrete ramps about 6 inches high, sunk in the ground for the purpose of facilitating the changing of oil in automobile crank cases, were not within a restrictive covenant that no buildings of any kind shall be erected or maintained within a specified distance of a street. This case cited Wilson v. Middlesex Co., 244 Mass. 224, 138 N.E. 699, where it was held that an uncovered stone stairway 20½ feet by 6 feet, leading below the surface of the ground to a basement, having around it above ground a metal railing 4 feet high, cemented into the stonework of the stairway, was not a “building” within the meaning of that term in a restrictive clause in a deed.

“Building” was contrasted with or distinguished from “appurtenance” in Juniata Planing Mill Co. v. Saxton Iron Co., 12 Pa.Dist. 171. “Appurtenance”, with reference to realty, has been said to be analogous to “improvements”; and it has been defined as something annexed to another thing more worthy; that which belongs to something else; and that which belongs to another thing, but which has not belonged to it immemorially. 6 C.J.S., Appurtenance, p. 134.

We are constrained to believe that the shelter is not a “building” as contemplated by the restrictions and the ordinance, and that it was not error to refuse the injunctive relief.

The judgment is affirmed.


author: LANGDON, Chief Justice.

text:
    E. A. TAORMINA et al., Appellants, v. Frank CULICCHIA et al., Appellees.
    No. 5514.
    Court of Civil Appeals of Texas. El Paso.
    Feb. 28, 1962.
    Rehearing Denied March 28, 1962.

      Strickland, Wilkins, Hall & Mills, Mission, for appellants.
    Johnson, Hester, Jenkins & Toscano, Harlingen, Henrichson & Bates, Edinburg, for appellees.
   LANGDON, Chief Justice.

This suit was instituted by plaintiff Frank Culicchia to recover his proportionate interest in the assets of a partnership between him and the defendants, E. A. Taormina and others, evidenced by a written agreement of partnership between the parties ■covering a period of three years from January 1, 1954 to December 31, 1956, and which terminated by express provisions thereof on the latter date. Plaintiff contends that he is entitled to recover not only his interest in the partnership assets, but also a proportionate share of the profits realized by a new partnership formed by defendants after the termination of the old partnership. Plaintiff’s claim to a share in the profits of the new partnership is based upon the contention that defendants failed to account to him (for his share of the assets) within a reasonable time after the dissolution of the former partnership on December 31, 1956. He contends that defendants retained and used his investment from January 1, 1957 to August 10, 1959 before making an accounting and payment to him of his proportionate interest in the assets of the old partnership, and that he is therefore entitled to recover a proportionate share of the profits realized by the new partnership during such period. It is undisputed that plaintiff refused to become a partner in the new partnership, although he was invited and afforded the opportunity to do so.

The case was tried before a jury; however, during the progress of the trial various matters, by stipulation and agreement, were withdrawn from the consideration of the jury and left to the determination of the court. Other matters were submitted to the jury upon special issues. On April 13, 1959 the trial court entered an interlocutory judgment, from which an attempted appeal was made. Briefs were filed by both plaintiff and defendant, but the appeal was subsequently dismissed by an order of the San Antonio Court of Civil Appeals, dated February 24, 1960, on the grounds that the judgment of April 13, 1959 was not a final judgment. (Culicchia v. Taormina, Tex.Civ.App., 332 S.W.2d 803.)

Thereafter, the fixed assets of the partnership were disposed of, either by sale or by partition in kind between plaintiff and defendants, and final judgment was entered on the whole case on August 24, 1960.

Briefs filed by the parties in the first appeal (aborted by the Court of Civil Appeals’ order of dismissal) have been withdrawn by the respective parties; and such briefs, together with additional original and supplemental briefs, have been filed in the instant appeal. In the first appeal plaintiff was appellant and cross-appellee, and defendants were appellees and cross-appellants. In the appeal now before us, the position of the parties is reversed. Undue confusion has resulted from the fact that plaintiff has failed to re-brief the points of error which he relied upon in the first appeal in which he was appellant. Such points are now technically “Cross-assignments of Error” and are urged on this appeal (in which plaintiff is appellee) by way of a “cross-appeal.” The confusion occasioned by the improvident re-filing of the original briefs from the former appeal is further aggravated by the fact that all the parties rely to some extent upon points, cross-points, argument and authorities contained in the “re-filed” briefs, and they sometimes fail to make a clear distinction in such briefs between appellant and appel-lee on this appeal. We have refrained from directing that the case be re-briefed (Rule 422, Texas Rules of Civil Procedure), but suggest that the parties might have avoided much of the confusion incident to this appeal had they themselves refrained from filing in this cause the briefs in the former appeal. In order to avoid further confusion, the parties will hereafter be referred to as they were in the trial court.

Defendants have appealed from that part of the trial court’s judgment by which plaintiff was awarded the sum of $15,300.00 on account of good will, found by the jury to exist, and $2,000.00 as an auditor’s fee based on a jury finding that the sum of $2,400.00 was a reasonable auditor’s fee for the services performed.

Plaintiff has appealed by reason of the trial court’s failure or refusal to allow him a recovery of his alleged proportionate share of the profits realized by the new partnership during the period from January 1. 1957 to August 10, 1959, during which period defendants failed to make an accounting and payment of plaintiff’s interest in the assets of the former partnership.

Defendants have based their appeal upon seventeen points of error which fall into four general categories. The points have been grouped by defendant for presentation on this appeal, and they will be discussed and considered by us in the same manner,

Group One consists of defendants’ Points 1, 2, 3, 4 and 12, complaining of alleged errors relative to the existence of “good will” as an item to be taken into consideration in an accounting between the parties.

Plaintiff and defendants, as partners, conducted a canning business at Donna, Texas. Under the terms of a written agreement the partnership was created for a term of three years commencing January 1, 1954 and terminating December 31, 1956. In December 1956, as the termination date of the partnership approached, the parties commenced negotiations among themselves for a new partnership agreement under which the business would have been continued by the same partners for an additional term of five years. The proposal was submitted to plaintiff, who declined to enter into a new partnership agreement unless he was paid a salary. Defendants refused plaintiff’s demand for a salary and proceeded to form a new partnership without the plaintiff. At the close of business on the date of the termination of the old partnership, there was on hand, among other assets, an inventory of canned goods having a book value of $286,129.90. There were also current liabilities in excess of $161,000.00.

It was agreed between the parties that the new partnership would undertake the liquidation and sale of the inventory in the regular course of business. A dispute arose when the parties became unable to agree upon an accounting, and because of plaintiff’s contention that the old partnership possessed a valuable intangible asset in the form of “good will”, and that he was entitled to be paid his proportionate share of the value of the “good will”, in addition to his proportionate share of the inventory and other tangible assets of the partnership. In the suit which followed, defendants denied the existence of good will as a recoverable asset, and alleged that the profits of the partnership and the success of same was attributable solely to the industry, ability and reputation of the managing partners, E. A. Taormina and A. F. Taormina, and that such good will, If any, was entirely personal to them. The jury, in answer to special issues, found that the partnership had a good will value over and above the value of its tangible assets, and further found the value of such good will to be the sum of $100,000.00.

There have been relatively few cases decided by the Texas courts involving the question of the value of “good will” as an asset of a business. However, the Texas courts have uniformly recognized and held that “good will” is property; that it may be the subject of bargain and sale; that it may be damaged or destroyed, and is like other property with respect to the right of the owner to recover damages for its destruction and, as such, “good will” although intangible, is an integral part of the business, the same as the physical assets of the business. Texas & P. Ry. Co. v. Mercer, 127 Tex. 220, 90 S.W.2d 557; Scott v. Doggett, Tex.Civ.App., 226 S.W.2d 183 (ref., n. r. e.); Rotan v. United States, 43 F.2d 232 (Tex.D.C., 1930); Alamo Lumber Co. v. Fahrenthold, Tex.Civ.App., 58 S.W.2d 1085 (error ref’d.).

In other jurisdictions the question of the nature, character and value of “good will” has been before the courts many times, and wc believe the Texas decisions are in accord with the view expressed by the majority of the courts. 1

The term “good will” has been the subject of numerous definitions, and most of these definitions, although expressed in different words, convey the same meaning.

In the instant case the court inquired of the jury (Special Issue No. 6) whether the Taormina Company had a good will value over and above the value of its tangible assets on December 31, 1956, and in connection with such special issue submitted the following instruction:

“In answering the above and foregoing Special Issue you are instructed that the term ‘good will’ is the advantage or benefits which is acquired by an establishment beyond the mere value of the capital stock, funds or property employed therein, in consequence of the general public patronage and encouragement which it receives from constant and habitual customers on account of its local position, or common celebrity, or reputation for skill, or influence, or punctuality, or from other accidental circumstances or necessities, or even from ancient partialities or prejudices.”

The definition of the term “good will” given in the instant case is substantially the same as the definition given by the trial court in the case of Texas & Pacific Ry. Co. v. Mercer, Tex.Civ.App., 58 S.W.2d 896, and inferentially approved by the Supreme Court (127 Tex. 220, 90 S.W.2d 557, supra) while reversing on other grounds. The same definition as that given by the trial court here for the term “good will” has long met with approval by the courts and was an accepted and approved definition even before it was again approved by the Supreme Court of Texas in an 1889 opinion written by Judge Gaines, in the case of Rice v. Angell, 73 Tex. 350, 11 S.W. 338, 3 L.R.A. 769.

On the question of the existence of good will, we believe the evidence is more than ample to support the jury’s finding that the Taormina Company had a good will value. The record in this case reflects that plaintiff and one of the defendants, A. E. Taormina, began their association in the canning business as early as 1928, in a corporation known as the Uddo & Taormina Corporation. In 1934 there was a division of stock, and these two, with other relatives, formed the Taormina Corporation, which took over several brands and trademarks. The brands and trademarks have been used in selling canned goods ever since. In 1944 a partnership was formed (Taormina Company) as the operating company and, with minor changes, the Ta-ormina Company, by virtue of periodic partnership agreements, has been continued in effect with leases and agreements to use the real estate, brands and trademarks from the corporation ever since 1944.

According to the testimony of one of the defendants (A. F. Taormina), the partnership firm (Taormina Company) had occupied the same premises since 1944. The premises were owned by the Taormina ■Corporation, and new leases were drawn up ■each year. Except for the dates, the leases were identical and had been since the first lease was made to the partnership in 1944.

Following the termination of the last partnership agreement on December 31, 1956, the defendants, having obtained a new lease from the corporation, continued in business at the same location, using the ■same name, and dealing with substantially the same suppliers and customers that the previous partnerships had used and dealt with ever since 1944. The advantages accruing to the new partnership by virtue of ■all these favorable elements, although intangible, represent a valuable asset of the "business, and is known as “good will”.

We reject the defendants’ contention that the “good will” of the partnership was personal to the defendants. While it is undoubtedly true that they each contributed to the success of the business by virtue of their hard work, industry and business acumen, it is by such efforts that good will is created. Good will is generally understood to mean the advantages that accrue to .a business on account of its name, location, reputation and success. The fact that the good will of the business was created by or resulted from years of hard work and business effort on the part of only one or two •of the several partners does not necessarily render the good will of the business personal to them. The value of the “good will” of a business depends upon the fixed and favorable consideration of customers arising from an established and well-known and well-conducted business. (See 18A Words and Phrases, Good Will, p. 210 et seq., for other definitions, factors and elements to be considered.)

Defendants’ second group of points (Nos. 5, 6, 7, 8, 9, 10 and 11) presents alleged errors involving the ascertainment of the value of the good will.

At the trial, plaintiff sought to establish the value of the good will of the partnership by the testimony of a certified public accountant, B. S. Mothershead. Mr. Moth-ershead qualified as an expert for the purpose of expressing an opinion upon the question of the existence and value of good will. His testimony reflects that he was experienced in this field and was frequently consulted by people in the business world for the purpose of determining the existence and value of good will connected with the transfer and sale of properties; connected with the withdrawal of part-owners from business; the settlement of differences between clients and others; and in connection with estate and inheritance tax appraisals. He also testified that he had made an investigation of the partnership company, had observed its operations, and had examined its books. The witness, basing his opinion upon a personal investigation of the company, testified that the partnership firm had good will, and fixed its value at the sum of $533,514.45 as of December 31, 1956. The witness testified that the method used by him in determining the value of the partnership good will was based on a formula used by-drhe Internal Revenue Service (A.R.M. ;34$, as well as by many private concerns. The formula is based upon excess earnings (earnings in excess of eight per cent to ten per cent of the average tangible net assets or invested capital of the business). Where the net profits exceed ten per cent of the tangible net assets or invested capital of a business, a good will value is indicated under the formula. The value of such good will is computed on the basis of the amount by which the net earnings of the business exceed normal earnings in the same or similar business.

The question of whether good will does or does not exist is one of fact for the jury to decide. While it is true that one test for determining the existence of good will is whether a reasonable man would pay anything for it, we do not believe this to be the exclusive test. The very nature of good will is such as would preclude a fixed standard by which its value might be determined in every case. For purposes of settlement or accounting, the value of the good will is to be determined in the light of all the facts of the particular case. 68 C.J.S. Partnership § 396, p. 910 et seq.

We are of the opinion that the trial court did not err in permitting the testimony of the witness Mothershead to be considered by the jury. Further, we are of the opinion that there was competent evidence to support the jury finding on the value of good will (Special Issue No. 7), and that the trial court did not err in submitting such issue and in awarding plaintiff the sum of $15,300.00 as his proportionate part of the value of the good will of the Taormina Company based on the jury finding.

From what we have said, it follows that we believe defendants’ points (Group One) relating to the question of the existence of “good will”, as well as those points (Group Two) relating to question of the value of such “good will” must be, and the same are accordingly overruled.

Defendants’ third group of points (Points 13, 14 and 15), are attacks upon the competency of the testimony of plaintiff’s witness, Mothershead, and the alleged error of the trial court in overruling defendants’ motion to strike such testimony, and in permitting same to be considered by the jury. We first considered the matter of the competency of the testimony of the witness, Mothershead, in passing upon defendants’ points (Groups One and Two), and have again reviewed and considered the testimony in the light of defendants’ points presented under Group Three. It was defendants’ contention throughout the trial that the profits of the partnership and the success of same were attributable solely to the industry, business acumen, ability and reputation of the managing partners, A. E. and A. F. Taor-mina; and the jury found, in answer to Special Issue No. 14, that the skill, industry, etc. of the managing partners was a dominant factor in the success of the partnership and in its profits and earnings. Defendants did not request an issue inquiring whether the good will of the partnership was personal to the two managing partners. Under the facts of this case, except for the purpose of establishing the fact that the partnership was a well-managed and successful business, as one of the elements of good will, it is immaterial which of the partners contributed most to the good will of the business in the absence of a finding that such good will was personal to such partner or partners. We have found no cases, other than those involving professional or highly specialized personal services, where it has been held that the good will attached solely to the person, and not to the business. We overrule defendants’ points (Group Three).

Defendants’ remaining points (Group Four, Points 16 and 17), are based on the contention that the trial court erred as a matter of law in rendering judgment for plaintiff for $2,000.00 as an auditor’s fee paid by plaintiff to his witness, B. S. Mothershead, because such auditor was not appointed by the court to make an audit, but performed said work solely on behalf of plaintiff and at plaintiff’s request, and for the purpose of being able to testify as an expert witness in plaintiff’s behalf upon trial.

There is no statutory authority under which plaintiff may recover such expenses, and we are of the opinion that the trial court erred in submitting the question to the jury, and in rendering a judgment thereon for plaintiff.

Rule 172, Texas Rules of Civil Procedure, authorizes the trial court, when an investigation of accounts or examination of vouchers appears necessary in the interest of justice, to appoint an auditor or auditors to state the accounts between the parties and to make a report thereof to the court, and in such case the court shall award reasonable compensation to such auditor to be taxed as costs of suit. Since the auditor in this case admittedly was not appointed by the court, and made no audit under the direction of the court, it was, we believe, beyond the power of the court to make an award to plaintiff for the expenses so incurred. Such expenses are allowed to be taxed as costs only where the auditor has been appointed by the court pursuant to Rule 172, Texas Rules of Civil Procedure, or the statute, Article 2292, Vernon’s Annotated Texas Statutes, which was the source of the rule. Navarro v. Lamana, Tex.Civ.App., 179 S.W. 922 (error ref’d); Nicholson v. Mills, Tex.Civ.App., 227 S.W.2d 354 (rehear. den., error ref.) ; McGrew v. Britton, Tex.Civ.App., 206 S.W.2d 836 (n. r. e.).

Defendants’ Points 16 and 17 are sustained. That portion of the trial court’s judgment awarding plaintiff the sum of $2,000.00 for auditor’s fee is reversed, and judgment is here rendered that plaintiff take nothing thereon.

This brings us to a consideration of plaintiff’s cross-assignments of error.

The principal points urged by plaintiff are based on the contention that the trial court erred in its failure or refusal to recognize plaintiff’s right to participate in post-dissolution profits realized by the Taor-mina Company between the time that the old partnership was terminated on December 31, 1956, and August 24, 1959, the date on which the new partnership paid plaintiff the sum of $113,437.29, plus interest, for his share of the assets of the former partnership. Plaintiff argues that the Taor-mina Company unreasonably withheld from him his proportionate share of the assets of the partnership and that, therefore, he had a right, if he chose to do so, to receive his share of the profits in the new partnership until his part of the investment was paid to him. Plaintiff was awarded $10,-984.12 in interest for the period during which his share of the assets was retained by defendants after the termination of the former partnership. He now contends that he was entitled, at his option, to take either interest or profits and that he has elected to take a share of the profits. Plaintiff asserts that the profits of the new partnership during such period were fabulously high, and he contends that his proportionate share of the profits would amount to approximately $89,000.00. However, in the abscace of jury findings, or stipulation, upon the question of the amount of such profits, there was no basis upon which the trial court could award plaintiff a share of the profits, the amount of which had not been determined.

We recognize, as a general proposition, that where a co-partner retires, dies or is expelled from a partnership, and the business is continued by the remaining partners without a settlement of accounts, members of the partnership who continue to conduct the firm business after such dissolution may be compelled to compensate the former member or his legal representatives, for the money and capital assets of such partner used in the continuance of the business. If a share of the profits is sought, the amount of such profits must be established.

Among the assets on hand at the time of the termination of the partnership on December 31, 1956 was an inventory of canned goods having a book value of $286,129.20. With respect to this asset the parties agreed, and it is so stipulated, that the new partnership would undertake to liquidate the inventory at the best obtainable price, and the proceeds realized therefrom less the expense involved in making such sales, was to be accounted for in the settlement of accounts between the partners. This agreement was fully performed, although it took the new partnership all of the year 1957 and a large part of the year 1958 to sell such inventory for the sum of $471,568.77. The value of plaintiff’s proportionate interest in the tangible assets of the partnership, however, was thereby enhanced. Because of the nature and complexity of the business, and accurate accounting was difficult, and numerous conferences and negotiations were had between the parties for the purpose of ascertaining the total value of the partnership assets as of the date of termination, and the extent of plaintiff’s interest therein.

Plaintiff’s own witness, B. S. Mothers-head, testified that it was impossible to determine plaintiff’s interest, and that plaintiff was in no position to agree on any accounting until about December 10, 1957. Notwithstanding the necessity of liquidating the inventory, and in spite of the fact that numerous accounting problems were involved before a final accounting could be had, plaintiff made a demand on January 11, 1957 for immediate payment of his share of the partnership, including undivided profits. On September 3, 1957, while conferences and negotiations were continuing between the parties in an effort to arrive at an accounting, plaintiff filed this suit.

At the trial, plaintiff failed to establish the amount of the profits earned by the new partnership after January 1, 1957, or the amount of such profits attributable to the use of his capital. He made no request for the submission of any issue on the question of post-dissolution profits, the amount thereof, or the extent, if any, to which the use of his capital contributed to such post-dissolution earnings or profits. Consequently, having failed to obtain jury findings on matters vital to any aw'ard by the court based on plaintiff’s asserted claim to post-dissolution profits, he may not now be heard to complain. The burden was upon plaintiff not only to meet the burden of proof required to establish his right to such profits, if any, but he also had the burden of showing the extent of the profits in which he asserted an interest, and the duty to request appropriate issues thereon. We are of the opinion that the trial court did not err in refusing to award plaintiff a share of the profits earned by the new partnership under the facts of the case before us. Plaintiff’s points based upon such contention are therefore overruled. We have also considered each of the other points raised by plaintiff, and believe the same should likewise be overruled, and it is so ordered.

As above noted, the judgment of the trial court is reversed and rendered in part, and in part affirmed.


author: McNEILL, Justice.

text:
    Gertie STRINGER et vir, et al., Appellants, v. Marvin IVY et ux., et al., Appellees.
    No. 6504.
    Court of Civil Appeals of Texas. Beaumont.
    Feb. 8, 1962.
    Rehearing Denied March 7, 1962.

      Peter Cheswick, Houston, for appellants.
    Musslewhite & Musslewhite, Fenley & Fenley, Lufkin, for appellees.
   McNEILL, Justice.

This is an action of trespass to try title filed by appellants Gertie Stringer, et vir, and her son, Charles Edward McVay, against appellees Marvin Ivy, et ux., Rube Sessions and Virgil Phillips, et ux., to recover a tract of 87 acres in the Archie Browning Survey in Angelina County, less an excepted 10 acre tract. Phillips, et ux. filed a' disclaimer, and Sessions filed a disclaimer of all the land except the minerals under a described 25 acres of the area involved, and as to this mineral area pleaded not guilty. Appellees Marvin Ivy and wife pleaded not guilty and several periods of adverse possession.

Appellant Gertie Stringer was formerly the wife of Ed McVay, known also as J. E. or Edd McVay. A short time after her marriage to McVay, his father, J. B. Mc-Vay, and brother, Wood McVay, executed a deed dated January, 1939, for a tract of land to Ed McVay. Appellants claim that tract as the land in this suit. Ed McVay, the grantee in this deed, divorced his wife, Gertie, in the year 1944 and no mention of any community property was made in the pleadings or judgment in the divorce case. Appellants alleged that Ed McVay conveyed the land in suit on August 11, 1947, to appellees, Virgil Phillips and wife and they in turn conveyed the land, less the 25 acres of minerals, to appellees Ivy and wife. Ed McVay died January 11, 1950. Appellant Gertie Stringer claims an undivided one-half interest in the property as community property of her marriage with Ed McVay. Appellant Charles Edward McVay, the only child of the marriage between Gertie and Ed McVay, claims the other undivided one-half interest by inheritance from his father. In an additional count, Charles Edward McVay also alleged that his father made the deed to Virgil Phillips and wife, through whom the other appellees claim, at a time when he was of unsound mind and prayed that this deed and the claims of appellees based thereon be canceled, and the cloud on his title be removed.

Appellants’ second amended original petition which was their trial pleading, described the tract of land involved as follows :

“ * * * a certain tract of land described in a deed from J. B. McVay and Wood McVay to Edd McVay, dated January 25, 1939, and of record in Volume or Book 90, Page 58, deed records of Angelina County, Texas, to-wit:
“A certain tract of land in Angelina County, Texas, containing 87 acres, more or less, out of the 116 acre tract patented in the name of Archie Browning, BEGINNING at the East corner of said survey a stake from which a Red Oak bears South 67 West 6 varas, a D O bears North 15 West 10 varas. THENCE South 45 West 610 varas in N.W.B. line of survey. THENCE-45 East 1081.5 varas to the end of corner of said survey at which a black oak or black gum bears South 1 East 5 varas. Red Oak South 67 West 10 varas. THENCE South 45 East 610 varas, to the place of beginning, containing 87 acres, more or less, less 10 acres conveyed to Angus Boone by a deed from Edd McVay and wife, Ger-tie McVay, dated January 24, 1940, recorded in Volume 93, Page 190, deed records of Angelina County, Texas.”

The petition then alleged the land involved is also described as follows:

“BEGINNING at the East corner of the Archie Browning 116 acre Survey, in Angelina County, Texas, a stake, from which a Red Oak bears South 67 degrees West 6 varas, and a Red Oak bears North 15 degrees West 10 varas; THENCE south 45 degrees West 1081.5 varas, to a stake in the South-East boundary line of said survey; THENCE North 45 degrees West 610 varas, to a stake in the West boundary line of said survey; THENCE North 45 degrees East 1081.5 varas to the North corner of said survey from which a Black Gum hears South 1 degree East 5 varas, and a Red Oak bears South 67 degrees West 10 varas; THENCE South 45 degrees East 610 varas, to the place of beginning, containing about 87 acres, more or less, save and except 10 acres conveyed to Angus Boone by Edd Mc-Vay and wife, Gertie McVay, on the 24 January A.D. 1940, deed of record in Volume 93, Page 190, deed records of Angelina County, Texas.”

Following this, appellants alleged in connection with the descriptions hereinbefore given that the description as given in the deed from J. B. McVay and Wood McVay to Ed McVay, recorded in Vol. 90, Page 58, Deed Records of Angelina County, was not a complete and full description in that one call was erroneously left out of the deed mentioned above, and they alleged that the last description given above is the proper description. No other allegation as to description was made, nor was there request for reformation of the deed.

The cause was heard with the aid of a jury. There was no agreement between the parties as to common source of title. In order to show common source and title in them, appellant offered in evidence a certified copy of the deed dated January 25, 1939 from J. B. McVay and Wood Mc-Vay to Ed McVay. The description in the deed is the same as that first quoted from above except that it ends with the phrase, “to the place of beginning.” Objection was made to the offer of this deed by appellees for the reason that it was void for lack of proper description and that it failed to describe any land. The court, however, permitted its admission. When, however, appellants rested their case ap-pellees filed motion ' for instructed verdict and assigned therefor, among other grounds, that this deed was void for lack of description, and that appellants failed to identify and locate on the ground the land described in their petition. The court sustained this motion and, in effect, could well have changed his earlier ruling on this evidence. In order to uphold this action it will be so presumed. Kneale & Watkins v. Thornton, Tex.Civ.App., 88 S.W. 298; Jetton v. Jetton, Tex.Civ.App., 257 S.W.2d 146.

Neither the field notes nor map of the Archie Browning 116 acre survey were offered in evidence. We have attempted to fit the description as contained in this deed into what is alleged by appellants as the proper description. To do this we would be required to add 471.5 varas to the deed’s first call and disregard this line’s called terminus “in the N.W.B. line of survey”; supply a second call, “thence North 45 W 610 varas”; and read- 45 East as “N 45 East” in the next call. In such case, only one call in the deed would be correct as written: the last call which is anchored by the bearing trees. And no testimony located any of them. There are cases which have .supplied a call in a deed where the other calls are accurate. Mansel v. Castles, 93 Tex. 414, 55 S.W. 559; Hinkle v. Hays, Tex.Civ.App., 162 S.W. 435; Battle v. Wolfe, Tex.Civ.App., 283 S.W. 1073. And one case that has supplied two calls under the peculiar facts there reflected. Fortenberry v. Cruse, Tex.Civ.App., 199 S.W. 523. On the facts of this record, however, we cannot hold that it was the intention of the grantors to convey a rectangular tract as contended by appellants. Especially is this so, in the absence of proof of the lines and corners of the Archie (Archer) Browning survey. We cannot tell, in the absence of further proof, whether the deed’s second call for boundary of the Browning survey, or perhaps for N.W. corner of another survey, should be disregarded. The deed itself calls for a tract of 87 acres, more or less. If we hold appellants’ rectangular field notes correct, the area enclosed would contain 117 acres, 30 acres more than the stated amount. In the circumstances there exists such uncertainty as to the description we would not be justified in attempting to resolve it. Deeds, Secs. 123, 124, 19 Tex.Jur.2d 422-427. Consequently on the evidence in this record, we hold the description in the deed to Ed McVay fatally defective and that appellants were unable therefrom to identify and locate the land sued for by them. Johnson v. Johnson, Tex.Civ.App., 275 S.W.2d 146; Tasher v. Foster Lumber Co., Tex.Civ.App., 205 S.W.2d 665.

The judgment below is affirmed.


text:
    EULESS DEVELOPERS, INC., Appellant, v. DRISKELL LUMBER COMPANY, Inc., Appellee.
    No. 16305.
    Court of Civil Appeals of Texas. Fort Worth.
    March 9, 1962.
    Rehearing Denied April 6, 1962.
    Bonney, Wade & Morgan, Herbert S. Bonney, Jr., and Minor Morgan, Dallas, for appellant.
    McDonald, Sanders, Nichols, Wynn & Ginsburg, and Richard Owens, Fort Worth, for appellee.
   RENFRO, Justice.

The appellant Euless Developers, Inc., appealed from a judgment which declared the mechanic’s lien owned by appellee Dris-kell Lumber Company to be prior to appellant’s vendor’s lien.

By warranty deed dated January 27, 1960, Euless Developers, Inc. (hereinafter called Euless) conveyed Lot 11-R, Block 1, Oak Crest Estates, an addition to the cities of Euless and Fort Worth, to C. Roy Kizer, Jr., in consideration of $10.00 cash and the execution of a promissory note in the sum of $1,550.00. The deed contained the following provisions: “It is the intention of the grantee herein, after title to the above property is acquired, to execute a mechanic’s lien contract securing Driskell Lumber Company in the payment of one certain promissory note, in the principal sum of $12,500.00, to cover the cost of construction of improvements on said property, and it is agreed and understood that the liens securing payment of the $1,-550.00 vendor’s lien note above described are and shall remain second and inferior to the $12,500.00 mechanic’s lien note and all liens securing its payment and all extensions and renewals thereof.

“The vendor’s lien of the undersigned, which is described in this instrument, shall be first and superior to all liens of laborer’s or materialmen, or other creditors, other than the principal amount of $12,500.00, being the principal amount of the above referred to mechanic’s lien note, it being understood that such vendor’s lien is subordinated only to the amount of said note; and when such amount is paid for labor and material on the construction of the improvements described in the mechanic’s lien contract, there shall be no further subordination to any other lien of any kind or nature.”

On the 28th day of January, 1960, C. Roy Kizer, Jr., entered into a mechanic’s lien contract with C. R. Kizer in contemplation of C. R. Kizer building a residence upon the above described lot, and on the same day executed a mechanic’s lien note in favor of C. R. Kizer in the sum of $15,500.00. The note and lien were assigned immediately to Driskell by Kizer.

The residence was completed with money furnished by Driskell. Kizer paid neither Euless nor Driskell.

Driskell sued to establish priority of its lien over Euless, and for recovery against the two Kizers.

The court granted Driskell judgment against the Kizers for $16,113.80, and adjudged Driskell’s lien, to the extent of $12,500.00, first and prior to the Euless’ vendor’s lien. Euless was granted judgment against C. Roy Kizer, Jr., for $1,388.10 and its lien established as second to Dris-kell’s lien. The Kizers did not appeal.

Euless contends Driskell did not acquire a lien superior to its vendor’s lien because its agreement was to subordinate its lien to a $12,500.00 note which was never executed' and because Kizer, Jr., agreed with Euless to construct a residence containing 1400 sq. ft. while the proceeds of the Driskell loan were used to construct a residence of less than 1400 sq. ft.

It will be noted that in the subordination agreement Euless provided that its vendor’s lien was subrogated “only to the amount of said note” and that when such amount was paid for labor and material on the construction of the improvements described in the mechanic’s lien contract there should be no further subordination of any kind. It was thus contemplated that more labor and materials would be required to complete the construction of the house, but, in that event, Euless would not subordinate its lien to such additional cost. There was nothing in the agreement to prevent Kizer from spending more than $12,500.00 on the house if he found it necessary. Driskell, the assignee of the mechanic’s lien, was the lender of money, not the contractor. It was willing to finance the construction up to an amount of $15,-500.00, but was willing also to restrict its first lien to the amount of $12,500.00. The fact that Driskell loaned three thousand dollars more than the amount of its mechanic’s lien did not prejudice Euless but was calculated to increase Euless’ security. Brooklyn Trust Co. v. Fairfield Gardens, 260 N.Y. 16, 182 N.E. 231.

From a study of the Euless agreement as a whole, we think it was the intention of Euless and Kizer that Euless would subordinate its vendor’s lien to the extent of $12,500.00. Since no sufficient reason appears to show that such intention should not be honored, it should not be disregarded. McConnell v. Mortgage Investment Co. of El Paso, 157 Tex. 572, 305 S.W.2d 280.

Euless claims it had an agreement with Kizer, Jr., that called for a building with an area of 1400 sq. ft. No such agreement was placed of record and there is no contention that Driskell, the lender, had any knowledge of such agreement. On the contrary, the warranty deed from Euless to Kizer, Jr., which contained the subordination agreement merely referred to “construction of improvements on said property”, and did not specify what improvements were to be constructed. Dris-kell, unaware of the agreement between Euless and Kizer, Jr., that the house would have 1400 sq. ft., and having itself made no such agreement with Euless, was entitled to rely upon the subordination agreement as it appeared in the deed. Under the circumstances the fact that Kizer constructed a house of less than 1400 sq. ft. did not destroy Driskell’s prior lien on the house that was actually built. Amer. Law of Property, Vol. IV, p. 218, sec. 16.106D.

The judgment of the trial court is affirmed.