author: LANE, J.

text:
    KOPECKY et al. v. CITY OF YOAKUM.
    No. 9435.
    Court of Civil Appeals of Texas. Galveston.
    Jan. 12, 1931.
    Rehearing Denied Jan. 29, 1931.

      Durell Miller, of Yoakum, H. W. Wallace, of Cuero, and Walter F. Brown, of Houston, for appellants.
    Green & Green, of Cuero, and Leslie C. Merrem, of San Antonio, for appellee.
   LANE, J.

Shortly prior to March, 1928, the city of Yoakum, hereinafter referred to as the city, issued sewer extension bonds, the proceeds of the sale of which amounted to the sum of $70,000.

In March, 1928, Yoakum State Bank, hereinafter referred to as the bank, was acting as the official city depository for the city, and $29,266 of the proceeds of a sale of the sewer bonds was deposited in the bank in March, 1928. At a meeting of the board of city commissioners of the city, held in March, 1928, they passed a resolution by unanimous vote selecting the Yoakum State Bank as an additional depository of the city, and at such meeting they accepted the bond of the bank given to secure the $29,266 above mentioned, which had been placed in the bank. The bond mentioned" was' executed by the bank as principal, and by Philip Welhausen, O. R. Davis, M. C. Driscoll, B. H. Treybig, B. H'. E. Hoppe, and O. L. Kopecky, as sureties, and delivered to the city, and reads as follows:

“The State of Texas — County of De Witt and Lavaca: City of Yoakum:
“Know all men by these presents:
“That Yoakum State Bank of Yoakum, Texas, a State Banking Institution, existing and doing business under the Banking Laws, of the State of Texas, as principal, and the undersigned as sureties, acknowledge it and themselves to owe and be indebted to E. S. Winfree, Chairman of the Board of Commissioners of the City of Yoakum, Texas, and his successors in office, in the sum of Sixty Thousand ($60,000.00) Dollars, .for payment of which, well and truly to be made, said Bank binds itself, its successors and assigns, and said sureties bind themselves, their heirs, executors and administrators, jointly and' severally, and by these presents:
“The condition of the above obligation Is such, that whereas, at the meeting .of the Board of City Commissioners of the City of Yoakum, Texas, held on the 17th day of March, A. D. 1928, the Yoakum State Bank of Yoakum, Texas, was selected as depository for a part of a special fund of the City of Yoakum, which fund is known as the Sewer Extension Fund, and being the money received by the City of Yoakum, Texas, as the proceeds of the sale of Seventy Thousand ($70,000.00) Dollars, City of Yoakum Sewer Extension Bonds.
“Now, therefore, if the Yoakum State Bank shall take good care of said part of said fund that may come into its hands as such depository of said fund, and pay out the same under the joint order of the Chairman of the Board of Commissioners of the City of Yoa-kum and the city clerk, and shall account to said Board of City Commissioners for all said funds that may come into its possession with interest on average daily balances at the rate of three per cent (3%) per annum, then this obligation shall become null and void, otherwise to remain in- full force and effect.
“In Witness Whereof, the Yoakum State Bank has caused these presents to be signed by its president and cashier under its seal, and said sureties for themselves, this 21st day of March, A. I>. 1928.”

Some time prior to the month of June, 1928, the city of Yoakum issued certain street improvement bonds, which were sold for $80,-000. On the 16th day of June, 1928, the city received the following letter from the bank:

“This is to authorize and request you to deposit with Yoakum National Bank Thirty-Two Thousand ($32,000.00) Dollars, and with Farmers and Merchants State Bank of Yoa-kum, the sum of Sixteen Thousand ($16,000.-00) Dollars, of the money received from the sale of Eighty Thousand ($80,000.00) Dollars of Street Improvement Bonds of 1928, issued and sold by the City of Yoakum, which money would ordinarily be deposited with this Bank as City depository. This Bank hereby relieves you of any liability or penalties which might accrue in its favor by virtue of it being City Depository of the City of Yoakum, and your having placed said funds with another institution. You are, however, notified that this Bank will not be liable for any funds not placed directly with it and you should therefore secure from these other Banks such bonds as you deem sufficient to protect you. The terms of this instrument shall remain in effect as long as this bank remains City Depository.

“In testimony whereof, The Yoakum State Bank has caused this instrument to be signed by its duly authorized President and Cashier, this 16th day of June, A. D. 1928.”

After the receipt of the above-quoted letter, the city deposited in the bank $32,000 of the money belonging to the street improvement fund, and, to secure the payment of such funds, the bank, as principal, and Philip Welhausen, M. C. Driscoll, O. R. Davis, W. Shropshire, C. S'. Kopecky, B. H. Trey-big, E. Hagens, B. H. E. Hoppe, and J. D. Grp.y, as sureties, on the 16th day of June, 1928, executed and delivered to the city the following bond:

“The. State of Texas, County of De Witt and ■ Lavaca, City of Yoakum.
“Know all men by these presents:
“That Yoakum State Bank of Yoakum, Texas, á Státe Banking institution, existing and doing business under the Banking Laws of the State" of Texas, principal, and the undersigned as sureties, acknowledge it and themselves to owe and .be indebted to E. S. Winfree, Chairman of the Board of Commissioners of the City of Yoakum, Texas, and his successors in office, in the sum of Sixty-Eour Thousand ($64,000.00) Dollars, for payment of which, well and truly to be made, said Bank binds itself, its successors and assigns, and said sureties bind themselves, their heirs, executors and administrators, jointly and severally, and by these presents:
“The condition of the above obligation is such, that whereas at the meeting of the Board of City Commissioners of the.City of Yoakum, Texas, held on the 16th day of June, A. D. 1928, the Yoakum State Bank of Yoa-kum, Texas, was selected as depository for part of a special fund of the City of Yoakum, which fund is known as the Street Improvement Fund and being the money received by the City of Yoakum, Texas, as the proceeds of the sale of Eighty Thousand ($80,000.00) Dollars, of City of Yoakum Street Improvement Bonds of 1928.
“Now, therefore, if the Yoakum State Bank shall take good care of said part of said fund that may come into its hands as such depository of said fund, and pay out the same under the joint order of the Chairman of the Board of Commissioners of the City of Yoakum, and the City Clerk, and shall account to said Board of City Commissioners for all said funds that may come into its possession with interest on average daily balances at the rate of three per cent (3%) per annum, then this obligation shall become null and void, otherwise to remain in full force and effect.
“In witness whereof, The Yoakum State Bank has caused these presents to be signed by its President and cashier, duly authorized by its Board of Directors and under its seal, and said sureties for themselves this 16th day of June, A. D. 1928.”

Thereafter, on the 2d day of June, 1928, the board of city commissioners, through the clerk of the city, wrote a letter to each, of the three banks in the city, including the Yoakum State Bank, notifying them that the board of city commissioners would receive bids for the custodianship of the city funds for the ensuing year ending June 30, 1929, and the Yoakum State Bank was the only bidder, and their bid was accepted unanimously by the board of city commissioners.

On the 20th day of June, 1928, the bank, as principal, and Philip Welhausen, E. Hagens, B. H. E. Hoppe, O. R. Davis, M. C. Driscoll, Louis J. Poth, F. O. Crawford, B. H. Treybig, J. D. Gray, W. Shropshire, C. L. Kopecky, J. L. Bass, Eilert Kuck, and C. S. Riggs, as sureties, signed the bond set out below and delivered it to the city, and it was accepted by it in the shape shown:

“Bond.
“The State of Texas, County of De Witt & Lavaca.
“Whereas, the undersigned principal, a hanking corporation duly incorporated and authorized by law to dp a banking business in the City of Yoakum, County of DeWitt, State of Texas, and now carrying on such business in said city, and in the County of DeWitt, of said State, and having its legal domicile in the said city, county and State, has been designated as City Depository for said city for the fiscal year ending June SO, 1929 (italics ours), by virtue of the laws of the State of Texas; and
“Whereas, to qualify and act as said City Depository, the said Act requires, among oth•er things, that the undersigned principal shall give a bond, with sureties, in the amount at lea'st double the total receipts of the City of Yoakum for the preceding fiscal year, said amount being for the sum of One Hundred and Fifty Thousand ($150,000.00) Dollars, and conditioned for the faithful performance of all duties and obligations devolving by law or ordinance upon said depository, and for the payment upon presentation of all checks drawn upon said depository by the City Clerk and Chairman of the Board of Commissioners of the City of Yoakum, whenever any funds shall be in said depository, and that all funds of the City of Yoakum shall be faithfully kept by said depository, and with the interest thereon accounted for according to law, and for breach of said bond the said city may maintain an action in its name.
“Now, therefore, know all men by these presents: That we, the said The Yoakum State Bank of Yoakum, Texas, as principal, and the undersigned B. H. Treybig, J. D. Gray, W. Shropshire, C. S. Kopecky, S. Ha-gens, B. H. E. Hoppe, O. R. Davis, M. C. Dris-coll, & Phillip Welhausen, As sureties, all of the county of DeWitt and Lavaca, said State, are each held and firmly bound unto the city of Yoakum, in the sum of One Hundred and Fifty Thousand ($150,000.00) Dollars, the payment whereof well and truly to be made to the City of Yoakum, in the city of Yoakum, said counties and State, we, and each of us, jointly and severally bind ourselves, our heirs, executors and administrators, firmly by these presents. The conditions of the above obligation are such that if the above named principal, the said The Yoakum State Bank of Yoakum, Texas, which has been designated as City Depository for the city of Yoa-kum as aforesaid, shall faithfully perform all the duties and obligations devolving by law or ordinance upon said depository, and shall pay upon presentation all checks drawn upon said depository by the City Clerk and Chairman of the Board of Commissioners of the City of Yoakum, whenever any funds shall be in said depository, and that all funds of the city of Yoakum shall be faithfully kept by said depository, and with the interest thereon accounted for according to law; and that for breach of said bond the said city of Yoakum may maintain an action in its name; and that said depository shall in every respect comply with all the requirements of all laws of Texas, and ordinances of the city of Yoakum, and shall perform each and all of the conditions contained in- and discharge all the duties imposed by said act or ordinance, then this obligation to become void, otherwise to remain in full force and effect. It is understood that the interest referred to above shall be Three (3%) per cent on average daily balances.
“Any suit on this bond shall be in the name of the city of Yoakum, and shall not be void on the first recovery, but may be sued on until the full sum named herein shall have been recovered.
“In witness whereof, the above named principal, acting herein by its president and under its corporate seal, does hereunto subscribe its name and the said sureties do also hereunto subscribe their names, this the 20th day of June, A. D. 1928.”

On June 30,1928, the city had on deposit in the bank, belonging to the general funds of the city, $62,000, and the same sum on July 1, 1928, and the city on said dates had on deposit in the bank $27,994.98 of the special sewer fund account and $31,841.50 of the special street improvement account.

During the months of July and August, 1928, and up to September 5, 1929, the city deposited in the bank $12,499.84; and during the same period it withdrew from the bank $41,755.58.

On the 5th day of September, 1928, the bank was closed by the banking commissioner, at which time the bank owed the city a balance, of the deposits made with it, of $93,119.52, and from such time the bank refused to pay checks drawn by the city against such deposits.

After the bank was closed, the banking commissioner paid the city, as a dividend, the sum of $9,311.95, leaving a balance due the city by the bank on September 5, 1928, of $83,807.57.

The bonds mentioned above will hereinafter be referred to as the sewer bond, the street bond, and general depository bond, respectively.

All those who signed the sewer bond also signed the street bond, and W. Shropshire, E. Hagens, and J. D. Gray, who did not sign the sewer bond, signed the street bond. All those who signed the sewer bond and the street bond also signed the general depository bond, and Louis J. Poth, F. O. Crawford, J. L. Bass, Eilert Kuck, and C. S. Riggs, who signed neither the sewer bond nor the street bond, signed the general depository bond.

The bank' having refused, after it was closed on the 5th of September, 1928, to pay checks drawn on it by the city, and after the sum of $93,119.52 owing by the bank to. the city had been reduced by the dividend paid by the banking commissioner to the sum of $83,807.57, the city brought this suit; to recover upon each and all of the bonds against all the signatories to the gen- ' eral depository bond, and the other bonds, together with interest thereon, jointly and severally.

The bank and the banking commissioner, James Shaw, answered by general demurrer and general denial. All the sureties on the general depository bond, who have appealed, urged various exceptions, general and special, to the plaintiff’s petition, and alleged substantially that plaintiff was not entitled to' any recovery upon the sewer bond, or 'street bond: (1) Because they were not made payable to the city, as required, by law, but were made páyable to E. S. Winfree, chairman of the board of commissioners of the city and his successors in office, for the benefit of the city; (2) because they terminated by operation of law long before the bank was closed; (3) because no money was deposited in the bank to the credit of either the sewer account nor street account after these bonds were accepted and approved by the city; (4) because after the approval of the street bond the city made a new selection of a city depository, which became effective on July 1, 1928, and that a new bond covered all funds, which the city accepted ..and approved on June 27, 1928; and said sureties further alleged that the plaintiff was not entitled to a recovery upon the general depository bond of date June 27, 1928, for any part of the $122,375.26 which was deposited in the bank prior to the execution of such bond, but could be held only for deposits made after such bond took effect, and they alleged that all such deposits were withdrawn by the city.

They also alleged that said $122,375.26, above mentioned was as a matter of fact not in the bank at the time the general depository bond was given, and that at such time the bank was wholly insolvent, and hence the city could not have withdrawn any part of the same, and that the city knew of those facts before the designation of the bank as a depository took effect, and that the reappointment of the bank as a. depository was part of a fraudulent scheme to saddle a loss on innocent bondsmen; that the selection of the bank as a depository in June to take effect July 1, 1928, was illegal and the bond given under such selection is void, and that the designation of the bank as a depository is also void, because no notice was given calling for bids for the right to be designated as depository, as required by law, and that, since the designation is void, the bond given by virtue thereof is void; that the city entered into a secret1 agreement with the bank that the bank should-, not receive all the revenue of the city during-the year beginning Juné 30, 1928, and that a portion thereof might be deposited in other, banks in the city, and therefore no recovery-should be allowed upon the general deposi-. •tory bond.

They also alleged that the bond was materially altered after those whose names appeared in the -body thereof had signed it,: by the signing of the same -by others without the knowledge or assent of those whose names appear in the body of the bond, and that, by . reason of such alteration, bond was void as an obligation of defendants.

By supplemental petition the plaintiff city' demurred generally to the allegations of defendants’ answer, alleging that such allegations state no defense to the plaintiff’s1 suit. The city also specially excepted to each and every paragraph of defendants’' answer, and averred that the matters as al-' leged are insufficient to advise the plaintiff of the specific matters relied upon by defendants as a defense to plaintiff’s suit so that-plaintiff might make answer thereto. Plaintiff also denied generally the allegations of' the defendants, and specially alleged that when the defendants signed, executed, and delivered the general depository bond, it was recited that the bank was a banking corporation, authorized -to do a banking business,' and was so engaged in the city of Yoakum, Tex.; that said bank had been designated ¡ as city depository for said city for the fiscal ' year ending June 30, 1929; that such recit? • als constitute representations made to plain- ‘ tiff upon which it relied, and, acting thereon, accepted said bond; and that, by reason of the matters stated, defendants are estop-ped to deny the truth of such statements and representations, and estopped to deny that they signed the bond as sureties. !

The court sustained all of the plaintiff’s, special exceptions to the answer of defendants, and defendants refused to amend.

When the case was called for trial, plain- ■ tiff dismissed as to B. H. E. Hoppe, M. C.1 Driscoll, and Philip Welhausen, for the rea- • son that they had been adjudged bankrupts by a federal court.

The case was tried before a jury. At the , close of the evidence, all parties asked the court for an instructed verdict in their re-', spective favors; whereupon the court denied the motion of defendants and instructed the jury to return a verdict for the plain- ’ tiff for the sum of $83,807.57, the sum sued for. Such verdict was accordingly returned, and upon such verdict the court render-' ed judgment against all of the defendants, except those who had been dismissed from the suit' by plaintiff, in favor of the plaintiff for the sum of $83,807.56 with 6 per cent, interest per annum from date of judgment. From such judgment defendants O. L. Kopecky, Bilert Kuek, B. Hagens, C. S. Biggs, O. K. Davis, Louis J. Poth, J. D. Gray, and W. Shropshire only have appealed.

The substance of appellants’ propositions Nos. 1 to 4, inclusive, may be stated as follows:

If the bank was insolvent when designated by the city as depository in June, 1928, and unable to pay upon checks drawn by the city upon it, deposits made prior to the execution of the general depository bond, if the city knew of such insolvency at the time the bond was executed and accepted, the sureties on such bond were not responsible for the repayment of such pre-existing deposit, for the reason that such deposit did not, in law or equity, represent a sum in the bank at the time of the execution and acceptance of the bond, nor did it represent a fund in the bank at any time while such bond was in force, but ⅞ was merely a debt for money previously deposited which the bank had lost and was unable to repay to the city.

We cannot sustain appellant’s propositions. Evidently, we think, the purpose and intent of the Legislature in requiring the execution of a bond by a depository of funds of a city was to guarantee the repayment of the funds deposited, and not such deposits only as was in actual money remaining in such depository at the time of the execution of the bond, for it is unquestionably the purpose of the depository in procuring the deposit of such funds, upon which it agrees to pay interest, to make loans of such funds. The contention of appellants that, if as a fact the depository had no funds out of which such deposits could be paid at the time the bond was executed, which could be' drawn out on checks of the city, the bondsmen would not be liable for the repayment of such funds, does not appeal to us. as a sound proposition. We hold to the contrary. Henry County v. Salmon, 201 Mo. 136, 100 S. W. 20; Sullivan v. City of Galveston (Tex. Civ. App.) 17 S.W.(2d) 478; Mathis v. Morgan, 72 Ga. 517, 53 Am. Rep. 847.

At the time the bond in this case was executed and aceeptedj the bank was a going institution and remained so until September 5, 1928, some months after the bond was executed and accepted by the city.

If it be conceded that the bank was in a bad financial condition, verging on insolvency, and that the city knew of such condition, there was neither pleading nor evidence to show that the sureties on the general depository bond, several of whom were officers of the bank, did not know of such condition. Under the circumstances shown, the city had the right, we think, to assume that the sureties understood the obligation they were assuming and that they signed the bond for the purpose of aiding the bank in getting the city to continue to deposit its funds in the bank. It is shown that, after such bond was given, the city continued to make deposits in the bank, and it is not shown that thereafter, until the bank was closed, the city deposited any of its funds elsewhere than in the Yoakum State Bank, the principal in the bond.

By their propositions Nos. 5, 6, and 7 appellants contend that the court erred in not permitting the witness Guyn, called by them, to testify to facts tending to show that the bank was insolvent at the time of the execution of the general depository bond; that It had as part of its assets worthless paper and other notes receivable amounting to $700,000 or $800,000 which exceeded the capital and surplus of the bank by about $600,000, and that the funds standing to credit of the city on the books of the bank could not have been paid by the bank at anytime from July 1, 1928, to September 5, 1928, the time the same was closed; that, from the time the first depository bond was given in March, 1928, and up to the time the bank was closed in September, 1928, practically no loans were made by it, and that it sustained no losses on transactions accruing after the first bond was given; that in June, 1928, he heard the affairs of the bank discussed in the presence of E. S. Winfree, chairman- of the board of commissioners of the city; that at that time the failing condition of the bank was discussed —for the reason, first, that such testimony was material and admissible to show that the credit balance in favor of the city, on •the books of the bank at the time any of the bonds sued on were given did not represent funds which the city actually -had in the bank, but merely represented a worthless claim, the real funds having long since (been dissipated; second, that such testimony was also admissible as tending to show that nothing was done by the bank toi impair the funds of the city after the bonds were executed, and as tending to show that there was no breach of the conditions of any of the bonds as alleged by the city.

What we have said in disposing of the contentions made by propositions 1 to 4, inclusive, we think, dispose of the contentions made by propositions 5 to 7, inclusive. Whether the bank was in a failing condition when the bonds were executed and accepted is an immaterial inquiry; the sureties who came to the aid of the bank at its request are presumed to have fully understood the obligation they were assuming. So far as the evidence shows, the City fully complied with the obligations assumed by it by reason of its acceptance of the general depository bond of date June 27, 1928, which became effective July 1, 1928. It continued to make deposits in the .bank, and made no deposits of any of its funds elsewhere after the bond was accepted. The court did not err in refusing the admission of the tendered testimony.

By their propositions 8 to 12, appellants contend substantially that the selection and designation of the bank as city depository for the year ending July 1, 1929, is void:

First, because such- designation was made in June, 1928, in violation of article 2559, Revised Civil Statutes of 1925, which provides, among other things, that “the governing body of every city in this State incorporated under the general laws therof, or incorporated under special Charter, at its regular meeting in July of each year, is authorized to receive sealed proposals for the custody of the city funds, from any banking corporation, association or individual banker, doing business within the city, that may desire to be selected as the depository of the funds of the city. ⅜ s ⅜ Notice that such bids will be received shall be published by the city secretary not less than one nor more than four weeks before such meeting, in some newspaper published in the city.”

Second, because .the notice required by article 2559 was not published.

Third, since the designation of the bank as city depository for the year ending July 1, 1929, is void, the general depository bond of date June 27, 1928, is also void.

It is the duty of a court of justice to try to get at the real intention of the Legislature in passing an act, and to give such act such construction as will promote such intention. Article 2559 provides no penalty and' imposes no forfeiture in case of noncompliance with its literal provisions. There is no declaration in the act that, if the designation of a depository is made at a time other than at a regular meeting in July of each year, as stated in the act, such designation should be void for failure to comply with the provisions of the act. We think that the provision of the statute declaring that the time for making such designation should be at a regular meeting of the governing body of a city in July of each year is directory only and not mandatory. In volume 2, § 621, Lewis, Sutherland’s Statutory Construction, it is said that, when a formality is not absolutely necessary for the observance of justice, but ⅛ introduced to facilitate its observance, its omission, unless there is an annulling clause in the law, will not annul the act.

In section 622 of the same volume It is said: “The requirement that the inspectors of a corporate election be sworn, in the absence of a nullifying clause on account of the omission, was held directory; that the election was not invalidated by the failure of the officers to be sworn. A statutory provision that the clerk of the district give notice of the annual meetings was merely directory, and that the proceedings after the meeting were valid although no notice was given. A hoard of canvassers cannot reject a pollbook on account of ifs being transmitted to the clerk through one not an elective officer. Statutes concerning the manner of conducting elections are directory unless the non-compliance is expressly declared to be fatal to the validity of the election or will change or make doubtful the result. Provisions requiring ballot^ to be initialed by the judges of election, to be marked in ink, and to contain the name of the party or principle which the candidate represents, were held directory.”

In Lewis, Sutherland’s Statutory -Construction, vol. 2, p. 1115, it is said: “Where a statute is affirmative it does not necessarily imply that the mode of time mentioned in it is exclusive, and that the act provided for, if done at a different time or in a different manner, will not have effect. Such is the literal implication, it is true; but since the letter may be modified to give effect to the intention, that implication is often prevented by another implication, namely, that the Legislature intends what is reasonable, and especially that - the act shall have effect; that its purpose shall not be thwarted by any trivial omission, or a departure from it in some formal, incidental or comparatively unimportant particular.”

The rule stated is upheld by the following decisions: Russell v. Farquhar, 55 Tex. 356; City of Uvalde v. Burney (Tex. Civ. App.) 145 S. W. 311; Gomez v. Timon, 60 Tex. Civ. App. 311, 128 S. W. 656; Ferris Press Brick Co. v. Hawkins, 53 Tex. Civ. App. 578, 116 S. W. 80; Reynolds v. Dechaums, 24 Tex. 174, 76 Am. Dec. 101; Farmers’ State Bank v. Brazoria County (Tex. Civ. App.) 275 S. W. 1103; Stone v. Hill, 72 Tex. 540, 10 S. W. 665; McInery v. Galveston, 58 Tex. 334.

It would seem from the rule above stated, when applied to the present case, the fact that the notice of the intention to make the designation of the depository for the year beginning on the 1st day of July, 1928, and ending on the 1st day of July, 1929, was made by addressing a letter, giving such notice to each of the .banks in the city, and not made in manner or mode designated In the statute, would not destroy the validity of such designation for want of notice, nor would it render such depository designation announced on June 27, 1928, to take effect July 1, 1928, void.

In commenting on the - time and mode of designating a depository, it is said in 18 Corpus Juris, p. 584, § 52: “The statutory specification of a particular date is directory merely”—feiting, State v. Siemens, 68 Or. 1, 133 P. 1173.

By their fifteenth proposition appellants insist that the general depository bond by its terms purports .to be a statutory bond to secure the performance of the statutory duties of the depository, and the statutory provisions should be read into it and provisions inconsistent with the statute should be read out of it, and as a statutory bond executed in June, 1928, terminates and expires by virtue of the statute in the following July, and as the bank was not closed or it had not failed to pay checks drawn upon it by the city until September 5, 1928,. a recovery against appellants on the bond was not warranted.

It is clearly apparent from what we have said that we think the bond was a statutory bond, but, if it be conceded that the bond was not executed strictly under the provisions of the statute and for such reason cannot be considered a statutory one, the sureties would nevertheless be liable on it as a common-law obligation. The statute does not provide that a bond differing from the one therein prescribed shall be void. It is clear, we think, that this bond was voluntarily given to obtain for the principal a privilege to which it was not entitled as a matter of legal right, and the circumstances under which it was given and acted upon are such as to make it a perfect common-law bond. Watkins v. Minter, 107 Tex. 428, 180 S. W. 227.

By appellants’ propositions Nos. 13 and 14, it is insisted that appellants are not liable for the payment of the $122,375.26 which was deposited in the bank before the bank became a depository, even if the bond be treated as a common-law obligation.

We have already, by a discussion of the contentions made under propositions 1 to 4, inclusive, and 8 to 12, inclusive, disposed of the contention made by propositions 13 and 14, and deem it unnecessary to further discuss such contentions.

By appellants’ propositions 16 to 25, inclusive, they insist that no recovery could be had on the sewer bond and the street bond, dated respectively March 21, 1928, and June 22, 1928, first, because they terminated and expired as a matter of law when the general depository bond, which covered all funds of the city, became effective; second, because they were not made payable to the city, as required by law.

The contentions thus made, if supported, would not lessen the liability of any one of toe appellants, as each of them was a party to the general depository bond of date June 27, 1928, which covered all the funds of the city, including those formerly covered by the two bonds, the sewer and street bonds, and therefore appellants are not entitled to a reversal of the judgment' though it be held that no recovery was justified upon the two bonds.

By their twenty-sixth, thirty-fourth, and thirty-fifth propositions, appellants, joined by J. L. Bass and F. O. Crawford, who did not appeal, insist (1) that the general depository bond does not by its operative words and terms create any obligation against Bass, Kuck, Riggs, Poth, and Crawford, who signed the bond, but whose names did not appear in the body of the same as parties assuming the obligation stated therein; (2) that said bond was not the contract of Bass, Kuck, Riggs, Crawford, and Poth, and it was not binding on them or any of them, but it only bound the bank and the sureties whose names appear in the body of the instrument; (3) as the bond was signed by appellants Gray, Kopecky, Hagens, and Davis, named in the body of the bond, and was thereafter signed by Bass, Kuck, Riggs, Poth, and Crawford without the knowledge or consent of the parties first named, but was signed by them upon the demand of the city that the principal, the bank, procure the signatures of additional sureties, the city was not entitled to any recovery on the bond against any of the sureties. They contend that the -bond was not enforceable as against appellants, Gray, Kopecky, Hagens, and Davis, whose names appeared in the body thereof, in that, after they had signed the same, it was materially altered by reason of the fact that the signatures of Bass, Kuck, and others were signed thereto without the consent of the first-named parties.

We think none of these contentions can be sustained. We think it clearly apparent from the terms of the bond that the purpose of its execution was to secure the repayment of all funds of the city which were or might be placed in the depository bank during the life of the bond, as well as from the circumstances surrounding its execution, and that Bass, Kuck, Riggs, and others whose names did not appear in the body thereof fully understood that they were to be sureties to accomplish the purpose for which the bond was given.

In volume 6, R. C. L. p. 835, § 225, it is said: “Generally speaking, the cardinal rule in the interpretation of contracts is to ascertain the intention of the parties and to give effect to that intention if it can be done consistently with legal principles. It has been said that to this paramount rule all others are subordinate. The parties should be bound for what they intended to be bound for, and no more. The courts will hold them bound to that extent, if their intention can be arrived at.”

And in section 226, same volume: “There can be no doubt that the court may look beyond the form into which the parties have cast their contract. Neither the form of a contract nor the name given it by the parties controls its interpretation. In determining the real character of a contract courts will always look to its purpose, rather than to the name given it by the parties.”

■ Unquestionably Bass and others whose names did not appear in the body of the bond, but who signed the same, intended to sign as sureties and together with the other signers to assume the obligations stated in the bond, and it is equally certain that the city approved and accepted the bond after Bass and others had signed it with the understanding that all those who signed it had, by their signatures, obligated themselves to see that the terms of the bond were performed. Neither Bass, ICuck, Riggs, Poth, or Crawford .filed a plea of non est factum, though the plaintiff sued upon the bond alleging that each of them had executed the same, together with the other signers, with the purpose and intention of becoming liable as sureties on the bond. To bind Bass and others whose names appeared only as signers of the bond it was not necessary that they should be named in the same as sureties. Cooke v. Crawford, 1 Tex. 10, 46 Am. Dec. 93; San Roman v. Watson, 54 Tex. 258; Pequawkett Bridge v. Mathes, 7 N. H. 230, 26 Am. Dec. 737; Building Ass’n v. Cummings, 45 Ohio St. 664, 16 N. E. 841.

The cases cited by appellants to sustain their contention are all cases wherein conveyance of land was involved and are not applicable to such an instrument as is involved in the present suit.

The rule as to whether one who signs a conveyance of real property is bound by it, although he does not appear upon its face to be a party to it, we think well stated in Agricultural Bank v. Rice, 4 How. 225, 241, 11 L. Ed. 949, by Chief Justice Taney, as follows: “In order to convey by grant, the party possessing the right must be the grantor, and use apt and proper words to convey to the grantee, and merely signing and sealing and acknowledging an instrument, in which another person is grantor, is not sufficient.” But such rule is not applicable to such instrument as is here involved.

The contention that the bond was materially altered by the signatures of Bass, Kuck, Riggs, and others, after it had been signed by Gray, Kopeeky, Hagens, and Davis, so as to render it void or voidable, is untenable. It can hardly be seriously contended that the signing of the bond by Bass, Kuck, and others in any way injured the rights of Gray, Kopeeky, Hagens, and Davis. It would rather seem that the fact that Bass and others joined in the bond as sureties would share the risks assumed theretofore by the first signers, and would not be a material alteration to their damage.

By their twenty-seventh proposition appellants contend that the court erred in rendering judgment against them for any part of the deposits made before the general depository bond was given; by their twenty-eighth, that the court erred in rendering judgment against them, because at the time the bond was given there existed a secret agreement between the city and the bank that a part of the funds of the city would be placed in other banks in Yoakum, in violation of law; that, by reason of such agreement, the bond was rendered void; by their twenty-ninth, that the court erred in refusing to admit evidence tending to show that the bank was insolvent at the time the bond was given; by their thirtieth and thirty-third, that the court erred in not admitting evidence tending to show that the city knew that the bank was insolvent at the time the bond was given ; by their thirty-first, that the court erred in not admitting evidence tending to show that the city had no valid statutory bond at the time it advertised for bids on June 2, 1928.

We have heretofore, in discussing other; assignments, substantially held that none of® the matters complained of by these propositions constitute error, and therefore we overrule all such complaints without further discussion.

By their thirty-second proposition appellants contend substantially that the court erred in not permitting them to introduce evidence showing that the bond for $150,000 was not double the total receipts of the city for the preceding fiscal year, as stated in the bond, in that such evidence was material as tending to show that the city actively participated in a fraud in inducing the sureties on the general depository bond to execute same.

We overrule such contention as being without merit. The evidence, if admitted, would not tend to show fraud on the part of the city. There is nothing in the bond more burdensome than permitted by our statute, nor anything to mislead the sureties as to the obligation they voluntarily assumed.

By their thirty-sixth proposition appellants substantially contend that the court erred in sustaining the plaintiff’s special demurrer to the fourth paragraph of their answer, whereby it was alleged that the bank and the city board knew that the bank was insolvent and wholly unable to pay to the city the special sewer and street funds of •the city which had been deposited in the bank, upon an agreement entered into between the city, the bank, and two other banks, that, no • matter which one of the banks of the city of Yoakum should be chosen as a depository for the fiscal year ending June 30, 1929, certain portions of such special funds should be deposited in each of said banks ; that appellants knew nothing of such agreement; that by such agreement a fraud was practiced upon appellants which rendered void the general depository bond.

We do not think the court erred in sustaining the special exception complained of. We are at a loss to see how the agreement mentioned could have constituted a fraud as to appellants. It seems to us that, had all the special funds been deposited in the bank, the risk assumed by appellants would have been enlarged rather than diminished. A complete answer to appellants’ contention that they should be relieved of liability on the bond because under the-agreement alleged a part of the city funds was deposited in banks other than the chosen depository, is that, while the statute (article 2561) provides that it shall be the duty of the city treasurer to deposit all funds of the city with the chosen depository, his failure to so deposit such funds would not invalidate the bond given by the chosen depository to secure the repayment of such funds as were deposited in such depository. By the provisions of the statute mentioned, the penalty for a deposit of any part of the funds of the city elsewhere than in the chosen depository, unless agreed to by such depository, is 10 per cent, per month upon the amount so deposited to be recovered by the depository. It would seem from such provision that it was not contemplated that in such'ease as the present a deposit of á portion of the funds in banks other than the chosen depository, either with or without the consent of such depository, would work a forfeiture of the bond of such depository so as to release the sureties thereon upon the theory that the city had practiced a fraud upon such sureties. The allegation' that the agreement mentioned constituted a fraud as against the sureties -presents no defense to the plaintiff’s suit.

The court, upon special exceptions addressed th.ereto, struck out paragraphs 7 and 8 of defendants’ answer. By paragraph 7 it was substantially alleged that no notice was given calling for bids for a depository in manner as required by law, and that no bond was executed by the bank in connection with the designation of a depository made in June, 1928, until after the expiration of the five-day period mentioned in article 2560, Revised Statutes of 1925.

By their propositions 37 and 38 appellants insist that such allegations set up valid defenses to the plaintiff’s suit on the bond, and that the court erred in sustaining the special demurrer addressed to such paragraph, and by proposition 39 appellants complain of the action of the court .in striking out paragraph 8 of their answer, whereby they alleged that the bond signed by them as sureties did not secure the repayment of the funds deposited in the bank prior to the execution of the same; that, if the bond was valid for any purpose, it was only so to secure repayment of such funds as were deposited after the bond was executed, all of which were fully paid before this suit was instituted.

The court committed no error in sustaining such special exceptions. We have already, in a discussion of contentions made by other propositions, held that such allegations as are set up in paragraphs 7 and 8 of the answer present no defense to the plaintiff’s suit, and it is needless to repeat the same here.

We will not take the time or space to answer appellants’ propositions 40, 41, 42, and 43, wherein it is substantially insisted that the plaintiff was not entitled to a recovery against Bass and Crawford, in that O. It. Davis and B. H. E. Hoppe, acting as agents of the city and the bank jointly to procure additional signatures to the bond, for the purpose of procuring the signatures of Bass and Crawford represented to said parties that one Will E. Miller would be one of the signers on the bond as a surety and that the bond would not be delivered and approved until Miller signed same as a party, surety, and that, relying upon such representations, Bass and Crawford signed the bond as sureties.

Such contention, if true, would be applicable to defendants Bass and Crawford only, and to none of the appellants. Neither Bass nor Crawford are parties to the appeal. Neither of them signed the appeal bond, nor ■ does the name of either of them appear in the appeal bond as appellants, and therefore neither of them is in a position to claim relief at the hands of this court, and the appellants cannot do so for them.

Appellants by their fourty-fourth and forty-fifth propositions contend that the court erred in striking out the fourteenth and fifteenth paragraphs of their answer in response to special exceptions addressed thereto. By paragraph 14 it is alleged, in substance, that appellants were induced to sign the general depository bond by reason of material misrepresentations of fact made to them by the city which the city knew were untrue and which defendants did not know were untrue, and therefore they relied upon such representations and signed the bond as sureties, which they would not have done had they known such representations were false, and by paragraph 15 they allege that the city and the bank had entered into an agreement that only 40 per cent, of the sewer and street funds should be placed in the depository bank, and the remainder thereof in the other two banks in the city; that such arrangement was not- provided by law; that appellants were, by those procuring their signatures, who were acting jointly for the city and the bank, told that the bank was to be a statutory depository with all rights incident thereto; that, by reason of such agreement, the designation of the bant was not a statutory designation, carrying with it all the rights of a statutory depository;- that appellants, believing such representations to be true, signed the bond as sureties.

The only specific act alleged in paragraphs 14 or 15 of appellants’ answer, which they contend alleged that they were induced by false representations to sign the bond, was that there was a secret agreement between the city and the bank that a large part of the funds of the city should be kept in banks other than the depository bank.

As we have hereinbefore intimated, if not directly held, there is nothing in the answer of appellants which alleges any specific fact or facts which would constitute a fraud. We have also said that, if any part of the sewer and street funds were, under an agreement made before the execution of the bond, deposited in banks other than the depository bank, the sureties could not be and ⅛ fact were not misled to their damage as signers of the bond. There is no contention on the part of appellants that any funds of the city were placed elsewhere than in the selected depository after the execution of the general depository bond. It clearly appears that the only funds deposited in other banks by the city were parts of the sewer and street funds, all of which were deposited before the general depository bond was executed and approved. We do not think the allegations made in said paragraphs 14 and 15, nor in any other part of appellants’ answer, set forth any fact constituting a fraud upon the sureties nor any defense to the plaintiff’s suit.

In Corpus Juris, p. 589, it is said: “The sureties are estopped from denying * ■* * the truth of recitals in the (depository) bond which they executed. Ordinarily an obligor on the bond cannot show that he thought that he was signing some other paper. A surety who is induced to become such by selection * * * of a bank as a solvent depository is liable, although the representation as to the solvency is false. The government is not responsible for a fraud to which it is not a party, committed by the depository to induce a person to become a surety” — citing Mathis v. Morgan, 72 6a. 517, 53 Am. Rep. 847; Fidelity & Deposit Co. of Maryland v. Wilkinson County, 109 Miss. 879, 69 So. 865.

In Mathis v. Morgan, the Supreme Court of Georgia said: “The principles of common sense, * * * self-preservation, the first law of nature, as well as the well settled principles of law and equity in the books, put him [the surety] on inquiry, and affected him with notice of the bank’s condition.”

Two days after the trial had begun and after the plaintiff had announced that it rested, defendants asked the privilege of filing a trial amendment. Such request was by the court refused. Appellants present such refusal as reversible error.

We have carefully examined the record with reference to the ruling complained of, and conclude that the court did not abuse his discretion in making such ruling.

For the many reasons stated, the judgment is affirmed.

Affirmed.


source: Caselaw Access Project

author: ALEXANDER, J.

license: Public Domain

text:
    McCORMICK et al. v. SOUTHWESTERN LIFE INS. CO.
    No. 981.
    Court of Civil Appeals of Texas. Waco.
    Feb. 12, 1931.

      Bryan & Maxwell, of Waco, and O. F. Weneker, of Dallas, for appellants.
    Cockrell, McBride, O’Donnell & Hamilton, of Dallas, and Sleeper, Boynton & Kendall, of Waco, for appellee.
   ALEXANDER, J.

This was a suit in the nature of a bill of in-terpleader filed by the Southwestern Life Insurance Company in the district court of Mc-Lennan county, Tex., against Mrs. Marjorie McCormick and Mike T. Lively, both of whom resided in Dallas county, and Ben R. Sleeper, as guardian of the estate of Adelaide McCormick,, a minor, said guardian a'nd minor residing in McLennan county, Tex. The plaintiff alleged, in substance, that it had executed and delivered a life insurance policy in the sum of $3,000 on the life of Andrew P. McCormick, payable at his death to his wife, Marjorie McCormick; that Andrew P. McCormick was dead; and that Marjorie McCormick was his surviving widow, and Adelaide McCormick was his only, surviving child. The plaintiff admitted liability for the payment of the proceeds of said policy, but alleged that it was unable to determine to whom the same should be paid, inasmuch as a bona fide controversy existed among the defendants, each of them claiming the proceeds of the policy] The petition alleged that Mrs. Marjorie McCormick claimed the proceeds of said policy as the designated beneficiary therein; that the defendant Mike T. Lively claimed a part of the proceeds of the policy by virtue of an alleged assignment thereof from Mrs. Marjorie McCormick; and that Ben R. Sleeper, as guardian of the minor, Adelaide McCormick, claimed that the said Marjorie McCormick, the designated beneficiary, was the principal in willfully bringing about the death of the insured and that un-det the statute she had forfeited her interest in the policy.

Plaintiff paid the amount due under said policy, to wit, $3,000, into the registry of the court and alleged that it was a mere stakeholder, being able, ready, and willing to pay said funds to the rightful owner,' but that it could not determine the respective rights of the parties without hazard to itself and that it was in doubt as to which of said defendants was entitled to receive said funds. It prayed for a judicial ascertainment by the court as to whom payment of the proceeds should be made.

Defendant Ben R. Sleeper, as guardian of the estate of Adélaide McCormick, a minor, filed an answer in which said guardian alleged that Marjorie McCormick, the beneficiary named in said policy, had willfully brought about the death of the insured by shooting him with a pistol and that she had thereby forfeited the proceeds of said policy; that Adelaide McCormick was the only child and next of kin of the insured and was entitled to the proceeds of said insurance.

The defendants Marjorie McCormick and Mike T. Lively filed pleas of privilege alleging their residences to be in Dallas county and asking that the suit be transferred to the district court of that county. The plaintiff duly controverted the pleas of privilege. The trial court overruled the pleas of privilege and the defendants Marjorie McCormick and Mike T. Lively appealed.

The evidence shows without dispute that the defendants Lively and Marjorie McCormick resided in Dallas county; that Adelaide McCormick is a minor residing in McLennan county, and that she is the only daughter and next of kin to Andrew P. McCormick, and that Ben R. Sleeper, the guardian of her estate, resides in McLennan county. The home office of the plaintiff is located in Dallas county and the policy is payable at its home office.

It is the contention of the appellants that before the suit could be maintained in Mc-Lennan, county, the residence of the minor, Adelaide McCormick, the plaintiff must both allege and prove that there was a bona fide controversy as to the ownership of the funds, and they further contend/ that plaintiff failed to prove the existence of such a controversy.

The purpose of the remedy of inter-pleader is to protect an innocent stakeholder, willing and ready to pay the funds in his hands to the party or parties entitled to receive the same, not only from a double recovery, but also from the expense and vexation attending the defense of such suits as may be brought by rival claimants. It is an efficacious and wholesome remedy and is allowed as a substantial right to the complainant who, under proper circumstances, invokes the same. Great Southern Life Insurance Company v. Kinney (Tex. Civ. App.) 276 S. W. 741. In order to justify such a suit, the circumstances must be such as to place the stakeholder in some real doubt or hazard in passing and acting upon the conflicting claims. However, where the venue of a suit is dependent on the claims of the rival claimant in whose residence the suit has been brought, it is not necessary that the evidence establish his right to the funds by a preponderance of the evidence. It is sufficient if the evidence establishes any reasonable doubt as to his right thereto. Where the evidence establishes a reasonable doubt as to the rightful claimant, of the fund, the stakeholder has the right to select the forum in which the controversy is to be litigated so long as the suit is maintained in the county of the residence of one of such claimants. Nixon v. N. Y. Life Ins. Co., 100 Tex. 250, 263, 98 S. W. 380, 99 S. W. 403; Greenwall v. Ligon (Tex. Com. App.) 14 S.W.(2d) 829.

Eddie Barr, a witness for plaintiff, testified that he, as a newspaper reporter, visited the residence of Mrs. Marjorie McCormick on September 29th, and that he saw Andrew P. McCormick therei sitting in a chair. He had been shot and was in a semiconscious condition. The witness asked Mrs. McCormick who shot Mr. McCormick, and she said, “I did.” Witness then asked her why she shot him, and she said, “We had a little quarrel.” The defendant introduced a part of the deposition of Mrs. McCormick in which she detailed the circumstances of the killing, and if her testimony is true, she killed him in self-defense. The evidence further showed that Ben R. Sleeper, as guardian of Adelaide McCormick, had made demand on the insurance company for the payment of the proceeds of the insurance policy. Prior to the filing of the plea of privilege herein, said guardian had filed an answer in which he alleged that Marjorie McCormick had willfully brought about the death of the insured by shooting him, and said guardian claimed the insurance money on behalf of his ward. While such answer was not admissible to prove the truth of the allegations therein, it was evidence of an actual claim by such guardian and of the grounds of such claim, and the trial court had the right to take judicial knowledge of the claims made therein. Revised Civil Statutes (1925), article 5047, provides as follows:

“The interest of a beneficiary in a life insurance policy or contract heretofore or hereafter issued shall be forfeited when the beneficiary is the principal or an accomplice in willfully bringing about the death of the insured. When such is the case, the nearest relative of insured shall receive said insurance.”

While it is not proper for this court, at this time, to pass on the sufficiency of the evidence to establish the right of the guardian to the funds in question, we think the evidence is sufficient to raise a reasonable doubt as to who. is the rightful owner thereof. The evidence on a trial on the merits may show that the killing was in self-defense and that Mrs. Marjorie McCormick is entitled to the funds, but Marjorie McCormick is a party to the suit and the weight of her testimony will be a question of fact for the jury. The insurance company was not required to decide this doubtful question of fact and to pay over the funds at its peril.

The judgment of the trial court is therefore affirmed.


author: SMITH, J.

text:
    CAMERON COUNTY WATER IMPROVEMENT DIST. NO. 1 v. FLY.
    No. 8518.
    Court of Civil Appeals of Texas. San Antonio.
    Feb. 4, 1931.
    Greenwood & Lewis, of Harlingen, for appellant.
    Carter & Stiernberg, of Harlingen, for ap-pellee.
   SMITH, J.

Appellee, E. B. Ely, brought this suit against appellant, water improvement district, to recover damages for the loss of his bean crop, which was killed by a frost occurring in tire Rio Grande Valley on March 17, 1928. It was alleged by appellee that he made application to the district on March 12 for water for use in irrigating his bean crop; that the district negligently delayed furnishing the water before the frost came; that this delay resulted in the loss of the bean crop on account of a killing frost; that growing bean crops are less susceptible to injury from frost when freshly irrigated than at other times. Upon jury findings the trial court rendered judgment for appellee for the amount of damages flowing from the injury inflicted upon his crop by the frost.

The appeal presents the question of whether irrigation districts may be held liable in damages to the landowner on account of the ravages of killing frosts upon crops growing within the district under circumstances relied upon by appellee in this case. The question does not appear to have been decided in any case coming to our notice, and as its decision is not necessary to the disposition of this appeal, we shall refrain from passing upon it at this time. It may be said, as a matter of course, and by way of suggestion for 'the consideration of the parties to this suit and the trial court, that the primary, normal, natural purpose of irrigation projects is to furnish water in arid and semiarid sections with which to give sustenance to crops against the effects of drouth — in short, to take the place, as nearly as possible, of timely and seasonable rains. Now, the question follows: Shall the law supplement or divert that purpose to include the duty of foreseeing weather changes in time to flush the district with such supply or supplies of water as will circumvent the normal and natural effects of frost and other inclemencies, upon the crops of the district? And, in this connection, it is well to keep in mind that each water user has rights equal to all others similarly situated, and if one may demand water with which to avert the evils of capricious weather conditions, regardless of the need thereof for normal irrigation purposes, then all may at the same time demand like service for like purposes. These considerations suggest themselves in connection with the case presented. It should be added that the case of Pineapple Co. v. Ry. 55 Fla. 514, 46 So. 732, 20 L. R. A. (N. S.) 92, the only ease presented by appellee as being in point, is not «deemed by this court to have any material bearing uppn the question presented here. So should it be added that appellee does not contend that the water was not furnished in time to avoid the usual and ordinary damage to crops occasioned by delay in irrigation.

Appellee, in his trial petition, as stated in his brief, based his cause of action for damages upon two specific grounds of negligence charged to appellant: First, “the failure of appellant to lower a subcanal” ; and, second, the failure of appellant to keep its main canal “properly opened and cleaned out.” The trial court, in the face of timely and proper request therefor, refused to submit either of said grounds to the jury, and submitted only the general issue of whether or not appellant “negligently failed to make timely delivery of water in suitable quantities for the irrigation” of appellee’s bean crop. In this we conclude the court erred.

It is elemental that in an action for damages based upon negligence, where the plaintiff elects' to specify in his pleadings the particular acts of negligence of which he complains, he will be restricted in his proof to the acts specifically alleged, and the jury’s findings must be confined to those acts. Here, appellee pleaded that appellant negligently constructed and maintained its sub-canal, and negligently failed to keep its main canal open and properly cleaned, and that these acts of negligence caused a delay in furnishing the water demanded by appellee. If these issues had been submitted to the jury and the jury had resolved them against appellee, he could not have recovered, since he alleged no other grounds of negligence. Appellant, then, was entitled ,to a submission of those issues, upon a proper request therefor, which was in fact timely made, and should have been granted. Munger Automobile Co. v. American Lloyds of Dallas (Tex. Civ. App.) 267 S. W. 304.

Assuming that appellee was entitled in any event to recover damages occasioned to his crop by the frost, he could not do so in the absence of jury findings that appellant could reasonably have anticipated the coming of a killing frost, and that the furnishing of water before the frost came would save the bean crop. Appellant made timely request that such issues be submitted to the jury, but the trial court refused the request. Appellant also timely requested a submission of the issue of proximate cause, which the court likewise refused. There was nothing in the record which warranted the trial court in resolving these matters against appellant. Certainly, in any event, the evidence upon these matters was not sufficient to raise any presumption in favor of appellee.

The judgment is reversed, and the cause remanded.


author: SMITH, J. COBBS, J. FLY, C. J. SMITH, J.

text:
    CAMERON COUNTY WATER IMPROVEMENT DIST. NO. 1 v. TOMIYASU et al.
    No. 8523.
    Court of Civil Appeals of Texas. San Antonio.
    Feb. 4, 1931.
    Rehearing Denied Feb. 18, 1931.
    Carter & Stiernberg and Greenwood & Lewis, all of Harlingen, for appellant.
    Seabury, George & Taylor, of Brownsville, for appellees.
   SMITH, J.

This action was brought by K. Tomiyasu and others against the water improvement district to recover damages on account of the alleged failure of the district to timely furnish water for the irrigation of the plaintiffs’ crops. The case was submitted to a jury upon special issues, resulting in judgment against the district, which has appealed.

Appellees, alleged that they made legal demand for water, but that because the district negligently failed to lower the cheek gate, or install and use a lift pump, where Ithe main canal was tapped by the subcanal which supplied appellees’ lands, they could not get sufficient water for the irrigation of their lands. After a general denial, appellants set up the defense that if appellees failed to timely receive the irrigation demanded, such failure was occasioned by the negligent failure of appellees to maintain proper field ditches and laterals to distribute the water over their lands when made available to them by appellant.

There was ample evidence to support a finding establishing the defense pleaded by appellant, as well as a finding that appellees’ negligence, if-any found, was the proximate cause of the injury they complain of. Appellant made timely and proper request for the submission of the issues thus raised by both pleading and evidence, but the court refused the request, and did not otherwise submit those issues. It is obvious and elemental that this action was erroneous, and requires reversal of the judgment. In every jury case either party is entitled, upon timely and proper demand, to have his cause or defense submitted to and determined by the jury, where his pleadings and the evidence adduced thereunder are sufficient to raise appropriate issues of fact which could legally affect the judgment to be rendered. Articles 2189, 2190, R. S. 1925; Fox v. Hotel Co. 111 Tex. 461, 240 S. W. 517; St. Louis, S. F. & T. R. Co. v. Wilson (Tex. Com. App.) 279 S. W. 808; Darden v. Denison (Tex. Civ. App.) 3 S.W.(2d) 137; Hulen v. Ives (Tex. Civ. App.) 281 S. W. 350; Texas & P. R. Co. v. Perkins (Tex. Civ. App.) 284 S. W. 683. Here the defenses pleaded by appellant were sufficient, if established, to acquit appellant of liability. They were supported by material evidence, and appropriate issues thereon were requested by appellant to be submitted to the jury; but their submission was refused by the trial court. Clearly, appellant was entitled to have the jury pass upon those issues, and this right could not be defeated by the findings of the jury upon other issues not covering those withheld.

We sustain appellant’s proposition I. The error in refusing to submit appellant’s defense was emphasized by the erroneous refusal to submit the issue, properly requested by appellant, of whether .appellant’s negligence was the proximate cause of the injury complained of by appellee, as pointed out in appellant’s proposition II. By this combination of errors' appellant was denied the right of having the jury find, if so minded, that appellees’ own negligence caused their damages, or that appellant’s negligence, if any found upon full submission, was not the proximate cause of such damages.

It is not deemed necessary, in view of reversal on the grounds above stated, to discuss appellant’s remaining propositions, although it is deemed appropriate to suggest that appellee should more definitely describe the lands alleged to have been insufficiently irrigated by appellant; tbe issues of appellant’s alleged negligence 'should have been separately submitted, rather than generally, as pointed out in appellant’s proposition III, and the jury should be permitted to pass upon the number of acres, affected by appellant’s alleged negligence, since that issue appears to have been controverted in the evidence.

The judgment is reversed, and the cause remanded.

COBBS, J.

I cannot agree with this opinion.

FLY, C. J.

I fully concur in the foregoing opinion of Associate Justice SMITH.

On Motion to Certify Points of Dissent to the Supreme Court.

SMITH, J.

Appellees have filed a motion praying that this court certify to the Supreme Court the point or points of dissent upon which Associate Justice COBBS has disagreed with the opinion of the majority. Inasmuch, however, as the points of dissent are not entered of record or otherwise made apparent, there is nothing upon which to base a certificate of dissent, and appellees’ motion is accordingly overruled. Article 1852, R. S. 1925.


author: GRAVES, J.

text:
    SAN ANTONIO & A. P. RY. CO. v. COLLINS.
    No. 9494.
    Court of Civil Appeals of Texas. Galveston.
    Nov. 26, 1930.
    Rehearing Denied Jan. 15, 1931.
    Baker, Botts, Parker & Garwood, John T. Garrison, Arterbury & Coolidge, and C. E. Coolidge, all of Houston, for appellant.
    Atkinson & Gaugler and Charles Murphy, all of Houston, for appellee.
   GRAVES, J.

Appellee, a switchman in its railway yards at Houston, sued appellant for $5,786.64 in damages for breach of a contract of employment between them of date October 15, 1920, alleging that, after remaining in such service from May 4 of 1909, to May 14 of 1921, he was on the latter date unjustly discharged and deprived of his seniority rights, remaining out of its service and without having in the meantime earned any money at other employment, until he was reinstated by appellant on November 3 of 1923, in response to an order to that effect from the United States Labor Board, to whom a mutually voluntary and binding submission of the' controversy for decision had been made, which body further directed the payment to him of all sums he would have earned during the period of unemployment, less what he may have otherwise earned during that time; that appellant, while so restoring him to his former position, had refused to comply fully with the Board’s order and also pay him for the time he lost, which amounted to 893 days at $6.48 per day, or the total sum stated.

Appellant answered by general and special exceptions, general and special denials, and certain special pleas, the only one of such denials or pleas here pertinent being as follows: “For answer to so much of plaintiff’s petition and to his cause of action, if any, as is based on the decision and award of the United States Railroad Labor Board, defendant says, that under the terms of the Transportation Act of 1920, and of the Constitution and laws of the United States, which are hereby invoked, said award and decision of the United Railroad Labor Board is unenforceable either by the Board itself or by this court, and is in no way binding upon this defendant as a matter of law; and in this connection defendant specially denies that it ever agreed with the plaintiff or anyone representing the plaintiff to submit thq controversy herein to the United States Railroad Labor Board as an arbitrator, or in any other capacity; and defendant specially denies that it ever agreed with the plaintiff herein, or anyone representing him, to be bound by the decision and award of said United States Railroad Labor Board, but that on the other hand this defendant, when approached by plaintiff and his representative specially, refused to join plaintiff in a presentation of the controversy to the United States Railroad Labor Board, and that the plaintiff thereupon submitted the same ex parte to said Board and alone invoked its ruling, and that this defendant appeared at the hearing of the controversy before said' Board in response to the citation or invitation of said Board and without any agreement or intention on its part to be finally bound by an adverse decision of said Board, and this defendant stands ready to verify.”

■ Trial before the court without a jury resulted in a judgment for the appellee for the amount claimed, together with 6 per cent, interest thereon from November 3, 1923, to that date, hence this appeal by the railway company.

The learned trial judge filed these findings of fact and conclusions of law:

“Findings of Fact.
“1. That about May 4th, 1909, plaintiff entered into the employ of the" defendant as a switchman in its yards in Houston, Harris County, Texas, and continued to be so employed until May 14th, 1921.
“2. That about October 15, 1920, the defendant entered into an agreement with the representatives of the men employed as switchmen or yardmen on its railroad, and provided therein that no yardman would be taken out of service without just cause and that if he considered his dismissal unjust, he could refer his case to the division superintendent and appeal therefrom to the higher officials; and in case the dismissal is found unjust, the yardman will be reinstated and paid for all time lost.
“3. That about May 14, 1921, plaintiff was taken out of service and immediately took the matter of his dismissal up with the agent, then with the Superintendent, then with the assistant General Manager, who ordered him to return to Houston for service, and when the plaintiff returned to Houston for service he was advised by said assistant General Manager that his prior decision was in error and that the plaintiff could not have employment in Houston but could have employment in Kennedy, or San Antonio, which plaintiff refused to accept.
“4. Plaintiff requested the defendant to join him in a joint submission of the controversy to the United States Labor Board; this defendant refused to do. Whereupon the plaintiff acting through his representative submitted the matter to the United States Labor Board, and the Secretary of said Board, in turn, forwarded a copy of plaintiff’s submission to the defendant and inquired as to 'the desire of the defendant to submit data. This was the first notice defendant had of plaintiff’s submitting the matter to the United States Labor Board. The defendant-corrected the statement of the representative 'of plaintiff, and submitted its side of the matter to the United States Labor Board.
“5. There was some correspondence between the representative of plaintiff, the defendant and the Labor Board and the matter was set for hearing and the plaintiff appeared before the Labor Board in person and with his representative, and the defendant likewise appeared before the Labor Board with its general attorneys and Assistant General Manager, and both parties had full hearing and .submitted their matters to the Labor Board.
“6. The appearance of the plaintiff and of the defendant was voluntary.
“7. The Labor Board made its decision on October 23, 1923, ordering the plaintiff reinstated, and 'directing the defendant to pay to the plaintiff all sums which he would have earned, less what he had earned in other employment. On November 3, 1923, the defendant, acting through its First Vice-President and General Manager, advised the plaintiff that he was reinstated to his former position in accordance with the seniority rights under the contract, but that the defendant had no intention of paying for time lost.
“8. The plaintiff was past sixty years of age at the time of his discharge in 1921 and was not able to secure - similar or other employment, and his daily wage was Six and 48/100 ($6.48) Dollars for eight hours, and he has lost eight hundred and ninety-three days from the date of his discharge to the date of his reinstatement, a total of Five Thousand Seven Hundred Eighty-six and 64/100 ($5,-786.64) Dollars.
“9. Among other provisions of the contract, the plaintiff and all yardmen held rights of seniority, and the plaintiff was displaced by a man many years his junior in service.
“10. The contract of October 15, 1920, executed by the defendant and a representative of its yardmen, was in writing and was for the benefit and on behalf of all of the employees of the defendant in yard service, and the contract was accepted by the plaintiff and other employees and was observed by them and was likewise accepted by defendant and observed by it, and copies of the contract were furnished each of the employees.
“11. The contract provided that complaints of employees, both in the first instance, and, if the decision of the superintendent was not satisfactory, their appeal to the higher officials of the Company, should be in writing. Plaintiff made no written complaint to the defendant or its officers and was not required by them to make any written complaint and his.oral statement was received and acted upon by the officers as though written complaint had been made and no question for necessity for a written complaint was ever urged by the defendant until the trial of this case.
“12. That there was no complaint about the services of plaintiff, but that they, were generally satisfactory and that the plaintiff was continuing to perform his services and would have so continued to perform them during the period of time of his discharge.
“13. That the defendant was not compelled to answer the letters of the Labor Board and was not compelled to submit the matters to the Labor Board, and that there was a matter in controversy between the plaintiff and the defendant on the construction of the contract and its application to the plaintiff, and that matter was submitted by agreement to the Labor Board.
“Conclusions of Law.
“1. From the foregoing facts, I conclude as a matter of law that the contract of October 15, 1920, was for the benefit of the plaintiff and other yardmen and that the plaintiff and the defendant were equally bound thereby, and that the plaintiff would have a cause of action for a breach of the contract and that upon his discharge by the defendant and the refusal of the officers of the defendant to reinstate him, a controversy existed between the plaintiff and the defendant, and the plaintiff had the right to request the defendant to submit the matter to other- people than those called for by the contract, and that when the plaintiff submitted his matter to the United States Labor Board .and defendant submitted its side, that the submission was voluntary and both parties, by their submission, agreed to be bound thereby and that the plaintiff was bound thereby and the defendant was likewise so bound.
“2. I further conclude that the defendant was not compelled to submit the matter in controversy to the Labor Board under the terms of its contract but that the ruling of its General Manager would have been binding upon the plaintiff, but that the General Manager and Vice-President and Assistant General Manager, by their actions, expressed a willingness to submit the matter to the Labor Board, and the finding of the Labor ■Board on the unjustness of the discharge of the plaintiff is binding upon the defendant, and the defendant. likewise accepted. the terms of the award to the extent of ordering the plaintiff reinstated, thus complying with part of the award and refusing only to comply with that part involving the payment of money.
“3. I further conclude that the plaintiff, having made no money for the term of his discharge, was entitled to full payment for the- time lost, together with interest from the date it was due: October 3, 1923.”

As its quoted answer below presaged, appellant’s main contention in this court also is that the- Labor Board’s award or decision is neither enforceable nor binding against it, because, first, that body’s action is by law at most only made advisory; second, there was no evidence even tending to show that it ever agreed to arbitrate the matter in dispute at all, or that the Board might act in that capacity, its own appearance and full answer therein before such agency not giving rise to any implication that it had agreed to be bound by any decision the latter might render.

It is further urged: (1) that the question of whether appellee was entitled to be paid for time lost was not submitted to the Board, although attempted to be decided by it; (2) the appellee was in no event entitled to recover more than merely nominal damages for his discharge, because it was undisputably shown that he was on the same day offered other just as remunerative jobs of exactly the same, or similar, nature as the one he was let out of, and that he declined them all, exhibiting on this trial no reasonable ground for such refusal; (3) the allowance of interest on the damages found from the date of their accrual to the date of the trial was improper, because not specifically pleaded.

None of these presentments, we conclude, should be sustained.

We agree with the trial court that, in so far as concerns the resulting legal effect, the voluntary action of appellant in so promptly and fully accepting the Labor Board’s implied invitation to appear before and submit data to it in! a fully-explained prior submission — initiated by the appellee — of the whole controversy for adjudication there between them, coupled with its subsequent pursuit thereof both through a mutually contested hearing on the merits and a half performance on its own part of the Board’s resulting award, was tantamount to an acquiescence in such submission under consent to be bound thereby. Just how it could so put its hand to the plow, take its chances on arbitrament of the whole dispute there — which the action of both parties before, the Board invoked by their mutual reliance on the contract between them that provided, “in case the dismissal is found to be unjust, the yardman will be re-instated and paid for all time lost”—thereafter acknowledge itself obligated to perform the portion of the resulting award requiring appellee’s .reinstatement, and yet not be bound on that calling for payment for lost time, does not readily occur to this court. 5 Corpus Juris, top page 23, and footnote 47, also top page 33, and footnote 39. ,

Appellant’s theory seems to proceed from a conception that this suit is one upon and to enforce as such a decision of the United States Railroad Labor Board, wheteas we think it simply one for breach of the contract of employment declared upon, in which the award of the Labor Board as to its consequences under the facts shown was, in effect, accepted as final and binding; so viewed, since appellant has failed to successfully attack by citing sufficiently contravening evidence any finding of specific facts below, it is in our opinion clearly ruled on the principles of law involved by this court’s holding in St. Louis, etc., Ry. Co. v. Booker, 5 S.W.(2d) 856, in which cause writs of error and of certiorari, respectively, were refused in turn by the Supreme Courts of Texas and of the United States, 279 U. S. 852, 49 S. Ct. 348, 73 L. Ed. 995.

If, therefore, what was done in this instance amounted to the same thing in ultimate result as an agreement to arbitrate and to abide by the award whdn made, appellant’s refusal to agree in advance to a joint submission to the Labor Board became immaterial.

It also follows from the provisions of the contract sued upon, we think, that none of the remaining positions so insisted upon are sound. As stated, both parties in the trial before the board relied on it, and the real issue there determined was that the dismissal had been unjust, whereupon the consequent determination that appellee should both be reinstated and paid for all time lost —less what he may have earned in the interval in other employment—which the undisputed evidence showed was nothing, was but declaratory of its terms. Under that instrument the appellee was a switchman in the yards of appellant at Houston, with his seniority rights in that position there expressly provided for and preserved; hence it was neither a job of exactly the same or a similar nature for the employer—after displacing him there by a younger man, as the trial court found—to offer him a switchman’s place at either Kennedy or San Antonio, Tex.; and this, by the undisputed proof, was not only all that was ever tendered to him, but it would have deprived him both of the position and seniority in the Óouston yards the contract called for; he was not required to condone by acceptance thereof such a direct violation of his contractual rights and privileges.

As concerns the interest allowance complained of, this being a suit upon “written contracts ascertaining the sum payable” within the meaning of R. S. article 5070, we think the court had authority to add the interest to the amount found to be due as wages, from the time that became payable to the date of the judgment, as a matter of legal right under that statute, the appellee having first sued for the stipulated wages as such and then prayed for general relief. City of Houston v. Lubbock, 35 Tex. Civ. App. 106, 79 S. W. 851; Buffalo v. Stringfellow, 61 Tex. Civ. App. 49, 129 S. W. 1161; Security Realty Co. v. Critchett (Tex. Civ. App.) 206 S. W. 852; Trevathan v. Hall (Tex. Civ. App.) 209 S. W. 447; Wiess v. Gordon (Tex. Civ. App.) 209 S. W. 486.

■ These conclusions determine the merits of the appeal; they require an affirmance of the trial court’s judgment, which, accordingly, will be ordered.

Affirmed.