author: TUNKS, Chief Justice.

text:
    A. B. LEWIS CO., Inc., Appellant, v. NATIONAL INVESTMENT CORPORATION OF HOUSTON, Appellee.
    No. 6.
    Court of Civil Appeals of Texas. Houston (14th Dist.).
    Nov. 15, 1967.
    Rehearing Denied Dec. 13, 1967.

      John Gano, Joseph D. Jamail, Houston, Donald W. Keck, Fritz & Vinson, Dallas, for appellant.
    R. ,H. Singleton, Butler, Binion, Rice, Cook & Knapp, Houston, for appellee.
   TUNKS, Chief Justice.

This is a usury case. A. B. Lewis Co., Inc., plaintiff in the trial court and appellant here, alleged that certain payments made by it to National Investment Corporation of Houston, appellee, during the period from April, 1958, until May, 1960, were payments of usurious interest under the terms of Article 5073, V.A.T.S. Plaintiff sought recovery of double the amount paid as alleged usurious interest.

A. B. Lewis Co., Inc., is a Texas corporation. Its president is A. B. Lewis. In April, 1958, it was engaged in the used car business in Houston, Texas. At such time it desired to expand its business and sought to get the capital for such expansion from the defendant, National Investment Corporation of Houston, also a Texas corporation.

After some preliminary negotiations, the plaintiff, acting through its president, A. B. Lewis, and the defendant, acting through its vice-president, H. C. Hendrix, entered into an oral agreement. The substance of that agreement is in dispute, and that dispute is the subject matter of this lawsuit. The plaintiff contends that it was an agreement to loan money at interest. The defendant contends that it was an agreement wherein it, the defendant, agreed to buy, at discount, the conditional sales contracts through which the plaintiff sold its automobiles.

According to the testimony of Hendrix, the vice-president of the appellee, the agreement was to the effect that appellee would buy the conditional sales contracts representing sales by appellant of its automobiles; that appellee would discount those contracts at 6% per annum or ½ of 1% per month; that appellee was to hold 25% of the face value of each sales contract in reserve until the contract had been paid in full; that the reserve amounts so withheld were to be returned to appellant during the month following the final payment to ap-pellee of the face amount of each sales contract; and that if the account was paid off in advance, appellant was to be given credit for the reserve so held on the account.

The testimony of A. B. Lewis, president of appellant, was not substantially different as to the mechanics arranged for in the basic agreement between the two parties. He, however, testified that the parties referred to the transaction as a loan to be secured by a pledge of the conditional sales contracts rather than a sale of the contracts.

Also in the agreement of April, 1958, it was agreed that when appellant tendered to appellee for acceptance one of its conditional sales contracts, it would be accompanied by a credit report on the customer of appellant, the obligor of the contract, and appellee reserved the right to reject such of those contracts as it did not wish to accept.

During the period of time in question, more than 500 individual transactions occurred in the carrying out of the terms of the basic agreement. In each individual transaction appellant would present to ap-pellee a conditional sales contract upon a form selected by appellant and having in it the following language:

“Purchaser hereby agrees that the seller may sell or assign this contract, and all the seller’s rights and interests shall pass to the purchaser of this contract.”

The back of the conditional sales contract form used by appellant in its business had a form for assignment without recourse and a form for assignment with recourse. Those printed assignment forms, however, were not actually used in the transactions. Instead, there was stamped onto the back of the conditional sales contract form an agreement used by the parties in effecting the transfer from appellant to appellee. That stamped assignment form read as follows:

“For value received, we hereby sell, assign, transfer and set over the foregoing obligation to National Investment Corporation of Houston, with full recourse on us.
A. B. LEWIS CO., INC.
By _”

In each of the transactions between the parties, that form, above quoted, was signed by the transferor and the conditional sales contract was actually delivered to appellee.

The following example will demonstrate the procedures followed by the parties in carrying out the terms of their basic contract. If a conditional sales contract transferred provided for a principal amount of $1,000.00 payable by the buyer of the automobile, within one year from its date, there would first be deducted the amount of $60.00 as representing the “discount.” Next, there would be deducted the amount of $250.00 as representing the “reserve.” The total deductions would, therefore, amount to $310.00, and the net amount received by the appellant would be $690.00.

In each transaction the appellant would deliver to appellee not only the conditional sales contract but also the title certificate for the automobile involved. That title certificate would reflect that the holder of the lien on the automobile given to secure the payment of the conditional sales contract was A. B. Lewis Co., Inc. Nothing was done by appellee to record the transfer to it of the conditional sales contract nor otherwise to record any lien which it might have against the automobile to secure the payment of the conditional sales contract.

These conditional sales contracts so transferred to appellee were payable in installments. Pursuant to the agreement between parties, the buyer of the automobile continued to make his installment payments to A. B. Lewis Co., Inc., rather than to ap-pellee. While these conditional sales contracts had on them the above quoted recitation to the effect that they were assignable, they also had on them a provision to the following effect:

“Payment to any other than A. B. Lewis Company does not constitute payment hereunder.”

In accordance with the uniform practice, the customer, that is the person who had bought the automobile and executed the conditional sales contract, was not told that the contract had been assigned to ap-pellee.

As to the “reserve” withheld by appellee, it was not paid back to appellant nor credited to appellant until the entire principal amount of the contract had been paid. That is to say, in the above hypothetical transaction where the face amount of the conditional sales contract was $1,000.00, the $250.00 was not paid back to appellant nor credited to appellant when there had been payments of $750.00 on the account. Seven hundred fifty and 00/100 Dollars would represent the amount of the net cash received by appellant together with the $60.00 “discount” charge. Nevertheless, on that hypothetical transaction, appellant would have to see that appellee was paid the entire $1,000.00 before the appellant would be entitled to have paid back to it, or credited to it, the $250.00 withheld as a “reserve.”

Appellant does not contend that a bona fide purchase of a written obligation at a discount is illegal, even if the discount is more than 10% per annum. Appellant alleges, however, that appellee did not intend to actually purchase the obligations evidenced by the sales contract and that the use of the form of purchase at discount was, in fact, a subterfuge to conceal the collection of usurious interest.

Appellee, on the other hand, does not deny that if these transactions were loans secured by a pledge of the conditional sales contracts so that the amounts of money paid to appellee by appellant were interest rather than discounts, then the payments would exceed the lawful interest rate of 10% and constitute usury.

At the conclusion of the testimony, appellant moved for an instructed verdict, which motion was overruled by the trial court. The trial court submitted to the jury special issue No. 1 in the following language:

“Do you find from a preponderance of the evidence that the transactions between the plaintiff, A. B. Lewis Co., Inc., and the defendant, National Investment Corporation of Houston, which are listed on plaintiff’s Exhibit ‘A’, were loans of money by the defendant to the plaintiff ?”

The jury answered that special issue No. 1: “We do not.” The trial court entered judgment on the verdict that plaintiff take nothing from the defendant. Plaintiff’s motion for judgment n. o. v. and motion for new trial were overruled and appeal to this court was perfected.

The appellant here contends that the evidence shows as a matter of law that the transactions between it and appellee were loan transactions, that the payments made by it (the “discounts” withheld by appellee) were payments of usurious interest so that the trial court should have granted its motion for instructed verdict or its motion for judgment notwithstanding the verdict and we should here reverse the judgment of the trial court and render judgment for appellant in the amount of the payments so made.

Alternatively, the appellant contends that the jury’s finding to the effect that the transactions were not loans is so against the weight of the evidence that the judgment of the trial court, based on such finding, should be reversed and remanded.

The crux of the cause of action alleged by plaintiff is set forth in the following quotation from plaintiff’s trial petition:

“Plaintiff further alleges, in connection with the foregoing allegations concerning a contractual agreement whereby defendant advanced monies to plaintiff in connection with the various contract of conditional sale setforth in Exhibit ‘A’, that the use by defendant of such terminology as ‘discount’ and the rubber stamp ‘assignment’ offered and furnished by defendant constituted a sham and subterfuge for the purpose of undertaking to conceal the true intent of defendant to charge and collect from plaintiff usurious interest in connection with each and all of the various loan transactions.” (Emphasis added)

In American Mortg. Corporation v. Dunnam, Tex.Civ.App., 59 S.W.2d 1095, writ dism., which case involved a suit by a borrower to recover allegedly usurious interest, the court, at p. 1096, said:

“The appellee in his pleading recognized that in order to recover it was necessary to show that there was some scheme, devise, or subterfuge, by pleading that the appellants were engaged in a conspiracy and fraudulent scheme to loan money and charge for the use thereof, more than 10 per cent, per annum on the amount of the loan, and, as the facts were controverted, in order for him to recover, it was necessary to secure a finding of the jury on such issue.”

However, the fact that the transaction took the form of a valid sale of a contract at discount does not necessarily mean that the transaction was, in fact, valid. The courts will look through the form of transaction used by the parties to determine their real intent. If the intention of the parties to this contract was to make loans secured by collateral assignments of conditional sales contracts and providing for the payment of interest at a greater rate than 10% per annum, the fact that the transaction, as a subterfuge, took the form of a sale at discount will not preclude the plaintiff’s recovery. Western Guaranty Loan Co. v. Dean, Tex.Civ.App., 309 S.W.2d 857, writ ref., n. r. e.; Commercial Securities Co. v. Rea, 130 Tex. 11, 105 S.W.2d 872.

If, therefore, the evidence here is such that it showed, as a matter of law, that the purported sales of the contracts were subterfuges to conceal an intent to charge usurious interest, and that the transactions between the parties were, in fact, loans, then appellant is entitled to have the trial court’s judgment reversed and judgment here rendered in it’s behalf. If there is insufficient evidence here to support the jury’s findings to the effect that the transactions in question were not loans, then appellant is entitled to a judgment reversing the judgment of the trial court and remanding the case for another trial.

We are of the opinion that, not only is there some evidence to the effect that the transactions were sales at discount of the contracts, but also that the jury’s finding to the effect that those transactions were not loans is supported by sufficient evidence and is not so against the weight of the credible evidence as to require that jury’s finding to be set aside.

David E. Snelling, president of appellee, testified that in negotiations leading up to the oral contract which was made in April of 1958, A. B. Lewis’ request to him was that he, Snelling, purchase automobile paper from appellant and that appellant did not request that appellee make a loan of money to it.

Clay Hendrix, vice-president of appellee, testified that in the conference wherein the oral agreement was consummated, the parties referred to the transaction as an agreement for sale and purchase of conditional sales contracts.

A resolution passed by the Board of Directors of appellant corporation authorized the assignment of its conditional sales contracts without any recitation to the effect that such assignments were to be by way of pledge only.

The various documents, themselves, used by the parties in the consummation of the transaction and the recitation in those documents, may be considered evidence as to the parties’ intention. The conditional sales contracts themselves contained a provision to the effect that the seller of the automobile was authorized to sell or assign the contracts. The very language of the assignment itself purports to be an unconditional sale, assignment and transfer of the contract to the appellee. This instrument was executed in connection with everyone of the more than 500 transactions between the parties during the period of time in question. The contract assigned on each occasion was physically delivered to appellee. This, of course, is not inconsistent with the pledge of the contract; but it is not inconsistent with the sale of the contract, either.

The fact that the appellee required that it be furnished with a credit report of the buyer named in each of the sale contracts purchased by it, together with the fact that appellee on some occasions declined to accept contracts which it considered to be poor risks, is consistent with an intention on the part of appellee that it acquire ownership of the contract by virtue of the assignment.

The transactions between the parties were shown on the records of the appellee as purchases of contracts at a discount and not as loans of money.

The fact that the buyers of the automobiles were not notified of the assignment and did not make payments directly to ap-pellee, but rather made all payments to appellant, would be, if standing alone and unexplained, most persuasive evidence to the effect that the transactions were loans secured by pledges of the contracts rather than purchases of the contracts at discount. However, there is testimony to the effect that this arrangement was at the specific request of Mr. A. B. Lewis, president of appellant. The very contracts, themselves, so assigned, contained a provision to the effect that payment to anyone other than A. B. Lewis Company did not constitute payment of the contract. There is testimony to the effect that Lewis requested that hio company continue to collect the payments on the contracts because he wanted to keep in contact with his customers, who were repeat customers, with the hope of selling them other automobiles.

The fact that A. B. Lewis Company remained liable to appellee for the full amount of each contract assigned to it is consistent with a transaction which is a loan of money secured by a pledge of the contract. The fact is, however, that the language of the document used to effect the assignment “with full recourse” was to impose a contingent obligation on appellant to pay the amount of the sales contract if the buyer of the automobile did not do so. Such an obligation is not inconsistent with a sale of the contract rather than a pledge to secure a loan.

The fact that appellee did not cause the liens on the automobiles which were the subject matter of the assigned contracts to be placed in its name is evidence in support of the proposition that the transaction was in fact a loan rather than a sale. In view of the explanation given by the witness, Hendrix, in his testimony as to the reason for that fact, we certainly cannot say that that fact alone constitutes conclusive evidence that there was no sale. Hendrix testified that Lewis requested that the automobile purchaser not be informed of the assignment under the arrangement, between the two parties. It was at the request of Lewis that A. B. Lewis Co., Inc., was to repossess any automobiles on which the payments were not made. Hendrix testified that one reason why liens on the automobiles were not caused to be recorded in the name of the appellee was to avoid the clerical work that would be involved in those situations where repossession was effected by appellant. Another reason given by Hendrix for not so recording the transfer of the liens was in the fact that, since appellant was going to repossess those automobiles where there was a default, appellee wanted to be careful to avoid any possible tort liability for conduct in which appellant might engage in repossessing the cars.

While the agreement of the parties concerning the maintenance of a “dealer reserve” is entirely consistent with the construction of the contract as being one for the loan of money, such agreement is not entirely inconsistent with the construction of the contract as being one for sale at a discount. The sale was with full recourse on the seller and the maintenance of the “dealer reserve” was a security for the seller’s contingent liability under the full recourse provision of the assignment. General Motors Acceptance Corp. v. Mid-West Chevrolet Co., 66 F.2d 1 (10th Cir.).

Hendrix testified that if the payments on a contract assigned got 90 days past due, the assignor was obliged to pay it off in full. That is to say, if A. B. Lewis Company became liable under the “full recourse” agreement, and there was a 90-day delinquency, then the payments due under the assigned contract were accelerated. On those past due payments, 10% interest was payable. The procedure of the enforcement of this liability is not made entirely clear by the testimony. Hendrix explained it in the following language:

“We had a day of each month. He knew what the day was each and every month. He had until this particular day to get his remittances in and pay up his delinquencies. If the delinquencies were not paid, the amount that was due at that time, we would charge ten per cent simple interest on it.”

The fact that A. B. Lewis Company was charged 10% interest on late payments after it became unconditionally liable under the recourse provision of the assignment does not mean that the amounts withheld as discounts at the time of the assignments were necessarily payments of interest.

The language of the agreement between the parties here did not provide for payment of interest at a rate of greater than 10% per annum. In fact, the language of the agreement itself did not provide for the payment of any interest at all (except as to past-due payments after default) but rather, provided for the sales of contracts at a discount which is, on its face, perfectly legal. Under those circumstances, the plaintiff alleging that there was an agreement to pay usurious interest has the burden of proving that the contract between the parties was a sham and a subterfuge used by the lender to conceal the charging of usurious interest.

There is authority for the proposition that the party who claims that a transaction, valid on its face, is a mere subterfuge to conceal the charging of usurious interest, has the burden of proving that fact by “clear and convincing evidence.” Griffin v. Stewart, Tex.Civ.App., 348 S.W. 2d 800, no writ history; Great Southern Life Ins. Co. v. Williams, Tex.Civ.App., 105 S.W.2d 277, no writ history.

Where a contract does not, by its terminology, show that it contemplates the charging of usurious interest, the question as to whether or not the contract in that form was used as a sham and subterfuge to conceal an intention to charge interest, is a question of fact for the jury. Moser v. John F. Buckner & Sons, Tex.Civ.App., 292 S.W.2d 68, writ ref., n.r.e.

In Walker v. Temple Trust Co., 124 Tex. 575, 80 S.W.2d 935 (Tex.Com.App., opinion adopted by the Supreme Court), the Court said:

“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 dominant 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.”

The Texas cases cited to us by appellant as authority for its contentions are distinguishable from the facts of this case.

Commercial Securities Co. v. Rea, 130 Tex. 11, 105 S.W.2d 872, involved a transaction between parties quite similar to the transaction here involved. There were, however, some details as to which the transaction itself was distinguishable from the transaction between A. B. Lewis Company and National Investment Corporation. The most important distinction, however, is in the fact that in the Rea case the trial court, in a non-jury trial, found as a fact that the contract between the parties was one for a loan rather than one for the sale of accounts at a discount. The question presented to the appellate court, whose opinion is cited to us as authority, was whether there was insufficient evidence to support that finding. The holding on that question is not authority for the proposition that either the evidence in here shows a loan as a matter of law or is insufficient to support a finding by the trier of fact that the agreement was not a loan.

In Baum v. Daniels, 55 Tex.Civ.App. 273, 118 S.W. 754, no writ history, there was an admitted loan of money. The written agreement (a promissory note) provided for the payment of interest at the rate of 10% per annum. The payee of the note admitted that, pursuant to an oral arrangement, he charged an additional 8% at the time of the delivery of the note. There was an admitted loan of money and there was an admitted charge by the lender of 18% for such loan. The defense of the lender was based upon a contended for construction of the usury statute rather than a denial that he had, in fact, charged interest at a greater rate than 10% per annum. The court held against the lender as to his contentions concerning the construction of the usury statute. Under the construction which the court placed upon the statute, there could be no question but that the lender was, as a matter of law, liable for double the amount of the interest so charged by him.

In Campbell v. Oskey, Tex.Civ.App., 239 S.W. 332, no writ history, there was an advance by the defendant to the plaintiff of $750.00 to be used in a business venture. By the agreement between the parties, the plaintiff was unconditionally bound to pay back the $750.00 plus an additional $300.00. The defendant’s contention that plaintiffs advance was an investment in a joint venture was refuted, as a matter of law, by the fact that the plaintiff was bound to pay, regardless of the success of the venture, not only the $750.00 advanced, but also an additional $300.00. In the case before us, the plaintiff did not, by the “full recourse” provision of the written assignment become unconditionally bound to pay the face amount of the assigned contracts. Its liability was conditioned on the failure of the buyer of the automobile to pay.

In Glenn v. McCarty, Tex.Civ.App., 130 S.W.2d 295 (affirmed 137 Tex. 608, 155 S.W.2d 912), a non-jury trial was had before the trial court. That court found that the notes in question were “usurious because they aggregated the sum of $8800 and only the sum of $7920 was actually loaned or advanced thereon by the Temple Trust Company, and that the discount of $880, together with the interest of 7% per annum provided in the face of the notes, together with the acceleration clause provided in the deed of trust, made it possible for the payee to collect in one year more than 10 percent, the conventional rate of interest provided by law.”

The principal questions involved in that case have no relevance and bear no similarity to the questions here involved. It is to be noted that, in that case, the maker of a note providing for 7% interest, delivered it to the payee who discounted it 10%. That, of course, has uniformly been held to be invalid, if the amount of the discount together with the interest provided for on the face of the instrument, exceeds the lawful rate of interest. Such a transaction is not a legitimate “sale at discount.” Morris v. First State Bank, Tex.Civ.App., 192 S.W. 1074, no writ history. A. B. Lewis Co., Inc., was not the maker or obligor of the contracts which it assigned to appellee. Rather, A. B. Lewis Company was the payee of negotiable instruments assigned by it to appellee.

In both Community Finance & Thrift Corp. v. State, Tex., 343 S.W.2d 232, no writ history, and Flurry v. Hillcrest State Bank of University Park, Tex.Civ.App., 401 S.W.2d 857, cited by appellee in its reply to appellant’s brief, the courts were concerned with transactions that were admittedly loans of money. The questions involved were whether certain payments admittedly required exceeded the lawful rate of interest. In the first case it was held, as a matter of law, that monthly payments on an investment certificate which a borrower was required to buy and pledge as collateral as a condition to getting the loan were, in fact, payments on the loan. In the second case it was held, as a matter of law, that where the borrower was, as a condition to getting a loan, required to open a savings account assigned as a security for the loan and make monthly deposits, the monthly deposits were, in fact, payments on the loan. We do not believe that those authorities compel a holding, as a matter of law, that the transactions between appellant and ap-pellee were loans of money rather than sales at discount.

In its points of error numbers 4, 5, 6 and 7, appellant complains of the action of the trial court in rendering a partial summary judgment in favor of appellee. That partial summary judgment was based upon findings by the trial court to the effect that the withholding of the reserves by the appellee did not amount to payments of interest by appellant and, that certain discounts withheld more than two years before the filing of this suit, were, if payments of interest, barred by the Statute of Limitations. In view of the jury’s finding, above note, and our holding that such finding is supported by the evidence, the question as to the propriety of the trial court’s rendition of the partial summary judgment becomes moot.

Appellee alleged, as an alternative defense, that if the contract between the parties was for loans, rather than for sales at discount, appellant still should not be entitled to recover. It was alleged that appellant was experienced in the field of automobile finance; that it was familiar with the law of usury; that it voluntarily, without any compulsion, entered into the arrangements in question; and that appellant was, therefore, estopped to seek a recovery under Article 5073, V.A.T.S. Appellant also alleged that if the arrangements between the parties was a sham and a subterfuge for the purpose of evading the usury statutes of the State of Texas, then appellant was a party to that scheme and, as such, was in pari delicto and that appellant’s recovery should be barred for that reason.

The trial court submitted special issue No. 2 to be answered by the jury only if special issue No. 1 was answered “We do,” in the following language:

“Do you find from a preponderance of the evidence that plaintiff, A. B. Lewis Co., Inc., voluntarily entered into such loans of money, if any, made the basis of this suit with the defendant, National Investment Corporation?”

Since the jury answered special issue No. 1, “We do not,” the second issue was not answered.

Since the jury’s verdict and the trial court’s judgment is not based upon the alternatively alleged defense of appellee, we are not required to decide whether it would or would not have been available as a defense in this case. In an annotation appearing at 16 A.L.R.3rd, 510, entitled, “Borrowers Initiation of, or Fraud Contributing to, Usurious Transactions as Affecting Rights or Remedies of the Parties” Texas is listed as a jurisdiction which does not recognize such a defense.

Appellant contends, however, that the very submission of the issue was so prejudicial as to constitute reversible error. With that contention we do not agree. The error, if any, was harmless. Associates Investment Co. v. Cobb, Tex.Civ.App., 386 S.W.2d 578; Moran Corp. v. Murray, Tex. Civ.App., 381 S.W.2d 324; Texas & N. O. R. Co. v. Broadway, Tex.Civ.App., 345 S.W.2d 814, Rule 434, Texas Rules of Civil Procedure.

In connection with special issue No. 1, the trial court submitted the following special instructions: “As used in this issue, a (loan’ is a contract by which one party agrees to let another party have the use of a specified sum of money, or forbear the payment of a specified sum of money, for a definite period of time with the understanding that the borrower shall repay it with or without interest.” Appellant requested that there be added to the special instructions given by the trial court the following words:

“and ‘interest’ is the compensation allowed by law or fixed by the parties for the use, forbearance or detention of money;”

Alternatively, the appellant requested that the following language be added to the special instruction given by the court:

“Interest that exceeds 10% per year (an-num) when computed on the declining balance method is ‘usurious interest’.”

Appellants’ requests were refused and appellant objected. The trial court’s action in this regard is assigned as error.

It is to be noted that the inquiry made of the jury in special issue No. 1 is not whether the payments made (discounts withheld) were interest, but whether the transactions involved were loans. The instruction given by the court did not make the jury’s determination as to whether the transactions were loans dependent upon whether the payments (discounts) were interest. In fact, the instruction told the jury that there might be a loan even if no interest were charged or paid. Presumably, if the jury found that the transactions in question were loans, the trial court would have found, as a matter of law, that the payments (discounts) were payments of interest. The parties had stipulated that the payments (discounts), exceeded 10% per annum. The trial court properly refused to submit the requested special instructions.

Other points of error concern rulings of the trial court in admitting, over appellant’s objections, testimony of A. B. Lewis concerning usages and customs in the automobile finance business and as to his own experiences therein. Most, if not all, of the testimony so received, was merely cumulative of other testimony received without objection—some elicited by counsel for appel-lee. As to some of the testimony complained of—the testimony of Lewis as to his prior transactions with Pacific Finance Corp.,—the trial court instructed the jury not to consider it.

The complained of rulings of the trial court, if error at all, were harmless errors. Mueller v. Central Power & Light, Tex.Civ.App., 403 S.W.2d 901; Brown v. Dale, Tex.Civ.App., 395 S.W.2d 677, writ, ref., n.r.e.; Medina Elec. Co-op., Inc. v. Ball, Tex.Civ.App., 368 S.W.2d 227; Rule 434, T.R.C.P.

We have given due consideration to each of the points of error presented by appellant and to the many authorities cited in its brief. We are of the opinion that the trial court • committed no reversible error.

The judgment of the trial court is affirmed.


source: Caselaw Access Project

author: PARKER, Justice.

license: Public Domain

text:
    AUSTIN RANKIN CORPORATION, Appellant, v. CADILLAC POOL CORPORATION et al., Appellees.
    No. 6925.
    Court of Civil Appeals of Texas. Beaumont.
    Nov. 9, 1967.
    Liddell, Dawson, Sapp & Zivley, Houston, for appellant.
    Arthur J. Sabin, Addison, Ill., Ronald G. Byrnes, Houston, for appellees.
   PARKER, Justice.

Austin Rankin Corporation, a Texas corporation, sued Cadillac Pool Corporation, and General Pool Corporation, Illinois corporations doing business in the State of Texas without permits to do business in Texas, to cancel and rescind a contract of July 13, 1965, and recover $3,000.00 delivered by the plaintiff to defendants as the consideration for certain pool kits and accessories or, in the alternative to recover damages of $3,000.00 for breach of such contract. Upon a motion to dismiss filed by defendants alleging that they were not amenable to process issued by the courts of this state, judgment was entered that the cause be dismissed for want of jurisdiction of defendants’ persons. The parties will be designated as in the trial court.

On October 3, 1966 defendants’ filed three unsworn pleadings, namely: a motion to dismiss, a “special appearance and motion to quash service of process” and a motion for leave to file “its appearance instanter”. These were not unauthorized or .inadvertent answers. Hearing was had on November 14, 1966 with judgment signed and entered on December 1, 1966, dismissing defendants’ persons for want of jurisdiction. On the day of hearing plaintiff promptly moved the court to dismiss defendants’ motion to dismiss on the ground that defendants made a general appearance by filing these unsworn answers.

In order that the record would accurately reflect what took place on November 14th, 1966, the court stated “the pleading denoted on the cover, “Motion, to Dismiss (Pertaining to Plaintiff’s Second Amended Original Petition)” which bears the file mark of October 3, 1966, was filed by Mr. Gordon without any verification and when this matter was called to his attention by the attorney for the Plaintiff, he was permitted by the Court to attach, on November 14, 1966, a jurat and the signature of the notary, Mr. Krippner.”

Then Mr. Emanuel Gordon, attorney for defendants, requested that any jurat placed on defendants’ motion to dismiss be made nunc pro tunc as of the original time of filing the motion to dismiss, to-wit October 3, 1966. In view of Rule 120a Texas Rules of Civil Procedure the Court declined to entertain this request. This jurat was not on defendants’ motion to dismiss when it was filed and the court refused to consider it as having been placed thereon nunc pro tunc. Mr. Gordon was permitted to swear to the motion to dismiss. The body of defendants’ motion to dismiss is followed by the signature of defendants’ attorney, Emanuel Gordon, the statement that is was dated at Chicago, Illinois on September 26, 1966 and Emanuel Gordon’s address. Below that, in longhand, is the following:

“Sworn to, this date — November 14, 1966.
Emanuel Gordon, (signed) Attorney”
“THE STATE OF TEXAS 1 COUNTY OF HARRIS J
Subscribed to and sworn before me, the undersigned authority, on this 14th day of November, 1966.
/s/ Robert L. Krippner
Notary Public in and for Harris County, Texas”

Rule 120a T.R.C.P. states: “Such special appearance shall be made by sworn motion filed prior to plea of privilege or any other plea, pleading or motion”, and further clearly states: “Every appearance, prior to judgment, not in compliance with this rule is a general appearance”. We hold that defendants made a general appearance by filing their unsworn motion to dismiss. Having made their general appearance, defendants were before the court for all purposes. York v. State, 73 Tex. 651, 11 S.W. 869; Atchison T. & S. F. Ry. Co. v. Stevens, 109 Tex. 262, 206 S.W. 921; Phillips v. The Maccabees, Tex.Civ.App., 50 S.W.2d 478 (C.C.A.1932, no writ history); Graham v. McCarty, 69 Tex. 323, 7 S.W. 342 (1887). Rule 121 T.R.C.P.

Since defendants made a general appearance, and are before the court for all purposes, plaintiff’s other points of error are not passed on.

Judgment of the trial court is reversed and judgment rendered the trial court has jurisdiction of defendants with the cause remanded for trial upon the merits.


author: HIGHTOWER, Chief Justice. STEPHENSON, Justice. PARKER, Justice

text:
    Verena G. BROUSSARD, Appellant, v. LAMAR PLUMBING & SERVICE COMPANY, Appellee.
    No. 6905.
    Court of Civil Appeals of Texas. Beaumont.
    Dec. 13, 1967.

      Donald R. Hallmark, Houston, for appellant.
    Weller, Wheelus & Green, Beaumont, for appellee.
   HIGHTOWER, Chief Justice.

This appeal by plaintiff, Verena Brous-sard, is from a summary judgment in favor of defendant, Lamar Plumbing & Service Company.

The substance of plaintiff’s very brief petition is: On the 3rd day of June, 1965, one of defendant’s employees (Melville Moon) serviced a dishwasher in plaintiff’s home; after Moon had quit for the day, a fire occurred in plaintiff’s kitchen, spread throughout the house, causing considerable damage to the same, all of which was proximately caused by the negligent acts of defendant’s employee, Moon.

Plaintiff’s testimony was that the machine had been smoking several days before the day Moon inspected her machine. On that day, he told her the fan motor was only burned out and that it would be all-right for her to go on and use the machine until he could order and replace said motor; that she continued to use the machine for several more days, after which a fire occurred in the same approximately 30 minutes after she had quit using it, causing damage as aforesaid. She knew not the cause of the fire.

Plaintiff filed no reply to defendant’s motion for judgment, but did file an affidavit by Don O’Dell, a fire marshall for The City of Beaumont, in which it was stated that, after the fire, he inspected plaintiff’s residence and “ * * * concluded at that time and it is my opinion now that the fire originated * * * in the dishwasher, probably as the result of an exposed heating coil coming in contact with the wall for a sufficient length of time to ignite that combustible material.”

Moon, testifying for defendant as an expert on such machines, stated that upon going to plaintiff’s home, he found the fan motor in the machine was not running. He merely told plaintiff what was wrong and that as soon as he received a new part he would install it. Inspecting the machine, he checked the heating element and the fan motor by cycling the dishwasher through the drying cycle. He told plaintiff she could use the machine but that it would not dry the dishes. He determined that the failure of the fan motor was the cause of the smoke; that otherwise the machine, at the time of his inspection, was running perfectly. His testimony reflects that his inspection was the usual and customary one in such type of business. In short, his testimony eliminated every possible inference or probability that the fire was the result of any negligence or the proximate cause of any act or omission attributable to him.

In plaintiff’s brief it is contended that the evidence raised a fact issue that defendant owed a duty to plaintiff to reasonably inspect her machine; that defendant failed in its duty, thus causing injury. We do not agree.

The testimony of Moon, compared with that of plaintiff and O’Dell, controls the case. Plaintiff’s testimony of itself was of no consequence on the issue of the burden of proof cast upon defendant.

We are left with the affidavit of O’Dell to raise a disputed issue of fact against the positive testimony of Moon hereinbefore set out.

With all the testimony in mind, the problem before the trial court was whether the evidence before him, if offered in trial, would compel the submission of issues of fact to the jury. The testimony of O’Dell or plaintiff did not contradict the testimony given by Moon in any material respect, and we are of the opinion that the court correctly ruled in favor of defendant.

Affirmed.

STEPHENSON, Justice.

I concur with the result reached in the opinion of Chief Justice Hightower, but for different reasons.

The difficulty in this case arises from the fact that plaintiff pled general negligence and the defendant filed no special exception. We are forced to look to the evidence to determine whether or not there is evidence to support a finding of any conceivable negligence.

The statement by O’Dell that, in his opinion, the fire originated in the dishwasher, probably as a result of an exposed heating coil, was an opinion of fact which he, as fire marshall for 5 years, was qualified to give. This was evidence that the fire was caused by the dishwashing machine, but had no bearing on the issue of negligence.

In his brief, plaintiff suggests the negligence of defendant was in failing to properly inspect the dishwashing machine so as to discover the exposed coil. It is argued that defendant should have taken off the front panel, spent more time on the inspection and should have inspected the dish-washing machine from the rear.

I find no evidence in this record that a person of ordinary prudence, under the same or similar circumstances, would have made a different inspection from the one conducted by defendant. All of the evidence as to the inspection comes from defendant. In the first place, there is no evidence that defendant did not remove the front panel, as defendant testified he did not remember. Assuming that defendant did not take off the front panel, there is no evidence that such would have been the usual inspection to discover the cause of the smoke. Likewise, there is no evidence that the 10 to 15 minutes defendant testified he took to make his inspection was not sufficient time under the circumstances. Also, there is no evidence that a prudent person would have gone into the rear of the machine. Plaintiff, at most, did no more in this case than show that damage was caused by a fire originating in the dishwashing machine which defendant had inspected. It is elementary, according to the law of this state, that the occurrence of an accident is not of itself evidence of negligence. Rankin v. Nash-Texas Co., 129 Tex. 396, 105 S.W.2d 195.

The extent of the inspection, under the circumstances of this case, is a matter involving special training and knowledge, and also involving usage and custom. All of the evidence showing defendant made the usual and customary inspection, the fire itself is not proof as to the contrary. There is no liability without fault in this case, and plaintiff’s evidence did not establish negligence.

Plaintiff has a point of error that, in the. interest of justice, the case should be remanded because there had not been a full development of the facts. The “interest of justice rule” has no application to this situation. Inasmuch as we have found the trial court entered an errorless judgment, the case cannot be remanded for a fuller development of the facts. City of Houston v. Blackbird (Tex.), 394 S.W.2d 159.

PARKER, Justice

(dissenting).

I respectfully dissent because there are genuine issues as to material facts involving negligence.

Mrs. Verena G. Broussard testified she called Mr. Moon because she was concerned with her dishwasher, from which smoke was coming when used. This condition had existed some two weeks or so. The dishes dried. Mr. Moon went to the Broussard home. There, in the kitchen, he asked Mrs. Broussard and the maid what trouble they were having with the dishwasher. They told him they had been seeing smoke and smelling something burning. He testified that was the response to his inquiry. He stated it took him approximately 10 minutes to make the inspection and determine what was wrong. He determined the fan motor wasn’t running. In his words, he stated:

I checked the dishwasher, but I don’t remember whether I removed the front panel or not; that is not necessary, to check the drying element. But when I turned the machine on, I could tell what was wrong: the fan motor wasn’t running. I merely told them what was wrong with the dishwasher, that we would order a part for it, and as quick as the part came we would come out and repair it; that was all I done.

Mr. Moon told Mrs. Broussard “it would be all right for her to go ahead and use the dishwasher, but she wouldn’t have any drying cycle, her dishes wouldn’t be dry.” After Mr. Moon left, the Broussards continued to use the dishwashing machine for about a week. The smoke came out of the machine and dried the dishes as it had before Mr. Moon’s visit. About 8:00 p. m., on June 3, 1965, Mrs. Broussard turned off the dishwashing machine and went upstairs to her grandchildren. About 8:30 p. m., the children smelled smoke. Mrs. Broussard went to the kitchen, opened the dishwasher, and flames came out of it — solid flames. Flames were going up the wall above the dishwasher. She closed the dishwasher and called the fire department.

Don O’Dell, assistant fire marshall of Beaumont, inspected Mrs. Broussard’s homé after it was damaged by the fire, and was of the opinion that the fire originated in the dishwasher, “probably as a result of an exposed heating coil coming in contact with the wall for a sufficient length of time to ignite that combustible material.” All evidence is to the effect that the fire was caused by the dishwashing machine. A reasonable inspection by Mr. Moon is such inspection as a reasonably prudent man, representing himself to be an expert in dishwashing machines, in the exercise of ordinary care would make in response to his employment by Mrs. Broussard to determine and correct the origin of the smell of burning and the smoke. His duty was not only to repair the machine, but to inspect it to determine the origin of the smoke and advise her whether or not it was safe to use. Mrs. Broussard was not qualified to determine the cause of the smoke. Mr. Moon represented himself to be so qualified. Mr. Moon was the sole proprietor of Lamar Plumbing & Service Company. He qualified as an expert serviceman on this particular dishwashing machine. All of the evidence as to the details of Mr. Moon’s inspection comes from him. He is an interested witness. In effect, he testified that the inspection he made was that which would have been made by a person of ordinary prudence under the same or similar circumstances. Mr. Moon’s detailed testimony as to his inspection is summarized as follows:

By cycling the dishwasher through the drying cycle, he found that the fan was not turning. From this, he concluded the fan motor was the cause of the smoke. This dishwashing machine was mounted under the kitchen cabinet. From the front, by using a flashlight underneath, he determined the fan motor was out. The dishwasher is off the floor some four inches. He determined that the motor was burned out because it was not turning. He told Mrs. Broussard that she needed a new fan motor and he would order one. The purpose of the fan motor is to blow warm air over the dishes. Air, pulled in from the outside through a vent, is blown over the heating element composed of wire coils. The coils get red hot as an electric heater does. This coil would get much hotter if there was no fan blowing over it. There is a metal vent at the back of the machine near the wall taking this hot air up to the dishes after they have been washed. He did not inspect any other part of the dishwasher other than the fan motor. The failure of the fan motor could cause smoke, but he never mentions seeing smoke. Categorically, he testified he couldn’t remember having checked anything on this dishwasher other than the fan motor. The heating element is two-thirds of the way from the front toward the back of the dishwasher which was in a cabinet and back against the wall. This dishwasher has no back cover. At the top is the tub. It is made of porcelain. There is a drying vent of heavy gauge metal carrying the warm air from the drying element up through the tub where the dishes are. There is nothing between the heating element and the wall except a metal cylinder enclosing the heating element. The machine itself is of metal and porcelain. These machines are supposed to have safety devices to turn off the heating element if it gets too hot. Mr. Moon did not test the safety device, nor did he know which of three types was in the machine, if any, nor did Mr. Moon know at what temperature any of the three safety devices were set to go in operation to cut off the heating coil. Should a safety device fail, the result would be a burned-out heating coil. The same principle is involved in a small electric heater that can be burned all day, but the latter has a lower coil rating — that is to say, the safety device on an electric heater operates at a lower temperature than the safety device on the heating coil of an electric dishwasher. Moon testified that in order to inspect the back of the machine and the wall he would have been required to disconnect the plumbing and electricity and go to considerable trouble.

At no place does Mr. Moon say that he saw smoke coming from the motor. His testimony as to customary and usual inspection is not corroborated.

The metal vent carrying the hot air to dry the dishes and the metal container of the heating coil are conductors of heat, as a matter of common knowledge. Such heaR over a long period of time, although intermediate, as a matter of common knowledge is known to cause smoldering of a combustible material with smoke and sometimes with a flame. The wall was composed of combustible material. Moon undertook and was under the duty to inspect the dish-washing machine for the purpose of determining (1) if it was likely to cause a fire in its location and (2) to repair it and prevent a fire. In this action for damages resulting from the fire caused by the dishwasher, a judge or jury might consider the duty of reasonable inspection is not confined to mere optical observation of the machine in place in the most convenient manner, but also calls for tests to determine the origin of the smoke and examinations of the back of the machine against the wall of combustible material and the wall, particularly when Mr. Moon considered the dishwashing machine itself was fireproof.

The facts of this case are somewhat similar to those found in Brown v. Frontier Theaters, Inc., 369 S.W.2d 299 (Tex.Sup. Ct.1963). In that case, electrical defects in a neon sign were reported by Mrs. Brown to Mr. Ackley, manager for Frontier. Mr. Ackley sent an electrician to the scene. The electrician made some repairs and instructed Mrs. Brown that it was safe to turn a switch and use the neon sign. Mrs. Brown continued to see sparks with the switch on. She advised Mr. Ackley of this and he instructed Mrs. Brown to continue to use such neon sign. The Browns were following and relying entirely upon such instructions when the fire occurred. The Supreme Court held that the trial court was correct in its finding that Frontier Theaters, Inc., acting through Ackley, was negligent in failing to repair the electrical defects that were the cause of the fire.

Whether or not Mr. Moon exercised the proper degree of care is not to be determined by referring to his own personal judgment in reference to the situation. Although he acted in good faith, an omission of proper inspection on his part is negligence. As said in Oceanic Steam Nav. Co. V. Aitken, 196 U.S. 589, 596, 25 S.Ct. 317, 318, 49 L.Ed. 610:

* * * it is a mistake to say, * * *, that if the man on the spot, even an expert, does what his judgment approves, he cannot be found negligent. The standard of conduct, whether left to the jury or laid down by the court, is an external standard, and takes no account of the personal equation of the man concerned.

Also see Hanson v. Ponder (Tex.Com.App.) 300 S.W. 35 [aff. in part and rev. in part (Tex.Civ.App.) 293 S.W. 219].

In the light of common knowledge and experience, irrespective of the admissibility of Moon’s testimony that he made the customary inspection of the machine, a court or jury might arrive at a standard of ordinary care in the premises entirely different from Moon’s [Texas Co. v. Brown, 82 S.W.2d 1101, 1106 (Tex.Civ.App.1935, error dismissed) and cases cited therein], and find that Moon was negligent in his inspection and his assurance to Mrs. Broussard that it was safe to operate the machine. Much of the evidence of Moon is opinion evidence and is not conclusive of a fact issue. Fry v. Dixie Motor Coach Corporation, 142 Tex. 589, 180 S.W.2d 135, 136 (1944). Simmonds v. St. Louis B & M Ry. Co., 127 Tex. 23, 91 S.W.2d 332, 334 (Opinion of Commission adopted 1936).

Referring to the testimony of O’Dell, mentioned in Justice Stephenson’s concurring opinion, I would add to it: Lamar Plumbing & Service Company here questions the sufficiency of O’Dell’s affidavit, urging that it does not comply with the requirements of Rule 166-A. I agree with Justice Stephenson’s statement as to O’Dell’s affidavit. Further, Lamar Plumbing & Service Company did not object to the form of O’Dell’s affidavit in the trial court. Objections could not be initially raised on appeal to O’Dell’s affidavit. Hall v. Fowler, Tex.Civ.App.1965, 389 S.W. 2d 730. Jackson v. Hanover Ins. Co., Tex.Civ.App.1965, 389 S.W.2d 328. American Hydrocarbon Corp. v. Hickman, Tex. Civ.App.1965, 393 S.W.2d 197.

Under the record in this case, I would reverse the judgment of the trial court, remanding the case for trial upon the merits.

      . All testimony hearin by deposition or affidavit:


author: CHADICK, Justice.

text:
    Lee ALBIN, Appellant, v. ISOTRON CORPORATION et al., Appellees.
    No. 7843.
    Court of Civil Appeals of Texas. Texarkana.
    Oct. 3, 1967.
    Rehearing Denied Dec. 12, 1967.

      Annette Stewart, Thomas R. Hartnett, III, Parnass, McGuire & Handy, Irving, for appellant.
    Grover Hartt, Jr., Tobolowsky, Hartt, Schlinger & Blalock, June R. Welch, Dallas, for appellees.
   CHADICK, Justice.

This action was instituted to recover damages for and to enjoin a breach of an exclusive distributorship contract. The defendant’s motion for summary judgment denying relief of any nature was granted and plaintiff has appealed. The trial court judgment is affirmed.

Appellee John McDonald owns the patent to and manufactures a device sale-able as an exercising or reducing machine. In August or September, 1964, he and ap-pelleee, Mrs. Lee Albin, wife of Dean Albin, commenced a marketing operation that continued until late 1964 or early 1965, when McDonald, according to Mrs. Albin, told her that he had sold the patented device’s national sales right to W. E. Causey and Lee Causey. Shortly afterwards negotiations between Mrs. Albin and Lee Causey resulted in a written agreement between Mrs. Albin and Electronic Exercise Corporation dated May 7, 1965, covering Mrs. Albin’s role with that corporation for a twenty year period in distributing and marketing the machine. Lee Causey appears as President of Electronic Exercise Corporation and his father, W. E. Causey, as Operation Manager. The preface to the instrument expressed the desire of the corporation to make Mrs. Albin its agent in distributing and promoting the sale of the machines and one of the contractual provisions appointed her Vice President of Electronic Exercise Corporation.

On or about March 1, 1966, Isotron Corporation was organized with W. E. Causey and Lee Causey, according to Mrs. Albin, as its only officers and shareholders. The following written agreement was entered into between Mrs. Lee Albín and Isotron Corporation, to-wit:

“EXCLUSIVE DISTRIBUTORSHIP AGREEMENT
“This agreement is made this 28th day of March, 1966, by and between Isotron Corporation, a Texas corporation in Dallas County, Texas, and Lee Albin, an individual residing in Dallas County, Texas, hereinafter called Distributor.
“Isotron Corporation is the sole owner of the sales and distribution rights to an electrically operated device, known as Isotron exercising and reducing machine, for the entire state of Texas. Iso-tron desires to obtain a distributor to distribute and market such device throughout the entire state of Texas, except for Dallas County, in the state of Texas, and distributor is prepared to expend the distributor’s own funds for the purpose of promotion, building, and maintaining of retail dealers.
“Therefore, for and in consideration of the mutual benefits flowing to each of the parties by virtue of the terms of this agreement, the parties agree as follows :
“ISOTRON CORPORATION’S OBLIGATIONS
“1. Isotron Corporation hereby appoints Distributor as the exclusive distributor for the distribution and sale of Isotron exercising and reducing machines for the entire state of Texas, except for Dallas County, in the state of Texas, for a term of twenty (20) years. This distributorship conferred upon Distributor shall also extend to and cover devices which are essentially the same as the Isotron machines, regardless of whether such devices are manufactured under the same name or not, and regardless of whether such devices represent improvements or changes in the design of the original Isotron machines.
“2. Isotron Corporation agrees to sell to Distributor such machines when and as needed by Distributor and in the quantities needed to fill demand created by Distributor. In this connection, it is recognized by Isotron Corporation that Distributor will expend from time to time considerable amounts of money and time for the purpose of developing consumer demand for such machines and an organization of dealers for the purpose of selling such machines to the ultimate consumer; therefore, any failure on the part - of Isotron Corporation to sell to Distributor such machines in accordance with the terms of this agreement will result in special and consequential damages to Distributor including, but not limited to, loss of profits which Distributor would otherwise be able to earn except for failure of Isotron Corporation to fully comply with all of the terms and provisions of this agreement.
“3. The amount which Isotron Corporation shall receive from Distributor for the purchase of such machines is the net amount of $119.00 for the Isotron machine. It is understood and agreed that Isotron Corporation will promptly ship such machines from Dallas, Texas, to the place directed by Distributor upon receiving shipping instructions from Distributor and all risk of loss or damage in transit shall be upon Isotron Corporation unless otherwise agreed upon in writing by both parties.
“4. Isotron Corporation shall indemnify and hold Distributor harmless against and from any and all liability, claims and cause of action, including investigation and attorneys’ fees, growing out of, connected with, or related to the demonstration or use of machines.
“DISTRIBUTOR’S OBLIGATIONS
“1. Distributor shall make use of reasonable efforts to create and maintain a system of sales distribution for machines in the territory covered by this agreement.
“2. Distributor shall pay Isotron Corporation the agreed purchase price set forth above for each machine sold in the territory covered by this agreement.
“3. Distributor agrees that he, his employees, agents, associates, etc., will in no way misrepresent Isotron Corporation’s products, and that he will advertise, promote, sell and otherwise conduct his distributorship in a manner prescribed by Isotron Corporation, and Distributor also agrees that he will submit any changes he plans to make in Isotron Corporation’s prescribed methods of advertising or otherwise conducting a distributorship, to Isotron Corporation for approval prior to his making the aforementioned changes.
“MUTUAL AGREEMENTS
“1. Each party hereto shall be an independent contractor and neither party shall be regarded as an agent, employee •or servant of the other party.
“2. Distributor shall be permitted to form a corporation to be incorporated -under the laws of the state of Texas .and to assign this distributorship agreement to said corporation, whereupon Distributor shall be relieved of all personal liability under the terms of this agreement.
“3. If this agreement is enforced by suit, the prevailing party shall be entitled to recover of the losing party a reasonable attorney’s fee.
“4. In the event of a breach of this agreement or a threatened breach of this agreement by either party, the aggrieved •party shall have the remedy of specific •performance, damages or both, at the ■sole election of the aggrieved party.
“5. This agreement shall be regarded hy both parties as performable in the City and County of Dallas, State of Texas.
“6. This agreement contains the entire agreement between the parties and all prior parol agreements, understandings and representations have been merged into this written agreement. This agreement may not be modified, altered or varied, except by a written instrument signed by both parties and bearing a date contemporaneous with or subsequent to the date of this agreement.
“IN WITNESS WHEREOF, we have hereunto set our hands this 28th day of March, 1966, at Dallas, Texas.”

Mrs. Albin filed a suit June 3, 1966, in a district court of Dallas County, naming Isotron Corporation, W. E. Causey, Lee Causey and John McDonald as defendants. •The original petition alleged Isotron Corporation was the alter ego of W. E. Causey and Lee Causey, and that such parties, together with John McDonald, acted in concert to bring about a breach of Mrs. Al-bin’s contract with Isotron Corporation by notice to all dealers in the State of Texas to order Isotron machines “directly from defendants and further to refrain from honoring the exclusive distributorship” agreed to in the instrument quoted above and in “accomplishing the objective of which your plaintiff complains herein”. The petition also alleged that at all times pertinent to her lawsuit she acted as agent of each and all of the named defendants in the performance of her obligations under the contract.

By supplemental petition Mrs. Albin alleged (Paragraph II) that she: “was the agent of defendants herein and performed all of her duties under the direct control and supervision of the defendants. Plaintiff would further show that that part of said contract wherein it was stated that plaintiff and defendant are independent contractors is void as a matter of law as the same violates the public policy of this state * * *. That at no time was plaintiff engaged in the business of buying or selling the Isotron machines or related machines”. Then pleading in the alternative (Paragraph III) she alleges she made a new and subsequent agreement with W. E. Causey, Lee Causey and John McDonald, “whereby plaintiff was to perform all of the acts delegated to her by defendants”; the pleading continued with an allegation of work performed at the direction of the Causeys and McDonald. The supplemental pleading contained a further alternative (Paragraph IV) alleging, to quote, that she: “ * * * was induced to enter into said agreement by the false representation of Defendants herein, to-wit: that said contract was in all respects legal and binding on all parties; that said representations were made by defendants with intent to deceive and defraud plaintiff; that said representations were known to be false by the defendants, and that plaintiff believed and relied upon said representations and was induced to enter into said contract thereby. By reason of the foregoing Plaintiff has been damaged in the sum pleaded herein”.

Paragraph numbered 1 under the heading Isotron Corporation’s Obligations in the contract between Mrs. Albin and that corporation dated March 28, 1966, appoints Mrs. Albin the exclusive distributor of Isotron machines for the entire state of Texas, except Dallas County. Distribution and sale of the machines in the territory specified is by this paragraph restricted to and made the exclusive prerogative of Mrs. Albin. Such term binds the corporation not to distribute and sell or permit distribution and sale otherwise. Under the heading Distributor’s Obligations the forepart of the paragraph numbered 3 appears to subordinate the distributor’s freedom of action to such direction, rules and regulations as the corporation might make pertaining to advertising, promoting and selling the machines and in otherwise conducting the distributorship. No written manual or other evidence was offered to show the corporation prescribed methods of advertising, etc., or otherwise operating a dealership. When this retention of authority in the corporation is read in context with the language of the entire paragraph, however, the obligation does not appear to bind the distributor to acquiesce in such guidance or direction from the corporation. The closing language of the paragraph appears to contemplate a submission of proposed advertising, etc., for approval before a change would be made. The distributor is only bound to submit changes but not necessarily to follow the corporation’s directions thereon, thus implying that the distributor could make changes regardless of approval. Also, when the provisions of this paragraph are considered in context with the granting of an exclusive distributorship and the positive stipulation under the heading Mutual Agreements, that each party to the agreement is an independent contractor and not an agent, servant or employee of the other, it becomes clear that the language of paragraph 3 of the Distributor’s Obligations was not intended to give the corporation such control of the conduct of the distributorship as to change the relationship of the parties from that expressly stated to one wherein Mrs. Albin was the agent or employee of the corporation in advertising, promoting and selling the machine and in otherwise conducting a distributorship.

The agreement constitutes an illegal trust, as defined by Tex.Rev.Civ.Stat.Ann. art. 7426 (1960), and is a conspiracy in restraint of trade as defined in Tex.Rev.Civ. Stat.Ann. art. 7428 (1960). Tex.Rev.Civ. Stat.Ann. art. 7437 (1960) declares such agreements to be void and unenforceable. Climatic Air Distributors of South Texas v. Climatic Air Sales, Inc., 162 Tex. 237, 345 S.W.2d 702 (1961); Jackson Brewing Company v. Jack D. Clarke, Jr., 375 S.W.2d 352 (Tex.Civ.App. Beaumont, 1964, writ ref’d, n. r. e.) ; Grand Prize Distributing Co. of San Antonio, Inc., v. Gulf Brewing Company, 267 S.W.2d 906 (Tex.Civ. App. San Antonio 1954, writ ref’d) ; Ford Motor Co. v. State, 142 Tex. 5, 175 S.W.2d 230 (1943).

Mrs. Albin’s original petition founded her cause of action squarely upon a breach of the contract of March 28, 1966. Leaving the alternative fraud count out of consideration for the moment, the theory of recovery underlying her supplemental pleading is less apparent but the theory appears to be that regardless of the terms of the agreement her status in the actual execution of the contract was that of an agent or an employee, or in the alternative, that by the terms of a subsequent agreement she was an agent in the performance of certain described activities. Whether the work or activity associated with this subsequent agreement was in the furtherance of the March, 1966, contract or independent of it is not specifically stated; however, such allegations appearing in a supplemental petition, and not stating a cause of action on or the terms of a subsequent agreement, to have meaning the allegations must be construed to refer to the contract of April 28, 1966. The earlier statement of the pleadings herein discloses that Mrs. Albin did not plead for recision or reformation of the contract of March 28, 1966. Her effort in the lawsuit appears to be to enforce the contract wholly or partially or to somehow be recompensed in damages because' of its existence or terms. It seems a fair appraisal to say, without more tedious pursuit of the possible inferences of the pleadings, that her pleadings as a whole state no cause of action against any of the defendants that is not made to depend wholly or in part upon the contract of March 28, 1966. Excepting the fraud allegation, Mrs. Albin’s supplemental pleadings add up to nothing more than a construction she places on the exclusive distributorship contract.

Without rescinding or reforming the void contract of March 28, 1966, Mrs. Albin undertakes to enforce it by pleading and proof showing she allowed herself to be directed in the contract’s execution as though she were an agent of Isotron Corporation rather than an independent distributor as the written contract stated. The contract is not ambiguous, so evidence of an interpretation or construction that Mrs. Albin was an agent in carrying out the contract’s purpose is not admissible to vary its clear provisions. Climatic Air Distributors of South Texas v. Climatic Air Sales, supra; see also Patrizi v. McAninch, 153 Tex. 389, 269 S.W.2d 343 (Texas 1954), and Southern Health Ass’n v. Harris Memorial Methodist Hospital, 180 S.W.2d 169 (Tex.Civ.App. Fort Worth 1944, ref., w. m.).

The fraud allegations of Mrs. Al-bin’s supplemental pleadings do not state a cause of action cognizable in a court of law. Mrs. Albin elected by her pleadings to affirm a void, unenforceable contract and recover damages. With respect to election of remedies it is said in Tex.Jur. 2d Fraud and Deceit, § 81 that:

“The doctrine of election of remedies limits a defrauded party to the remedy of his election, if available remedies are inconsistent. It is readily apparent that an action for damages is ordinarily based on the continued existence of the transaction whereas an action for recisrion is based on its abrogation. A party who is injured by fraud may elect to accept the situation and recover his damages, or he may repudiate the transaction and seek restoration of the status quo through an action to rescind, but he cannot do both * * *”

The law applicable to her effort to assert rights under the void contract is succinctly stated in 38 Tex.Jur.2d Monopolies, Combinations, etc., § 19 in this language, to-wit:

“Under an express provision of the statute, any contract or agreement in violation of any provision of the antitrust laws is absolutely void and not enforceable either in law or equity. The effect of the illegality is that the law leaves the parties just where they have placed themselves and permits neither to assert rights arising under the contract.”

See also 13 Tex.Jur.2d Contracts § 202.

All of appellant’s points of error have been carefully examined and no error found that requires a reversal of the trial court’s judgment. Accordingly affirmance is ordered.


author: CLAUDE WILLIAMS, Justice.

text:
    Harry M. STANFIELD, Appellant, v. Jim O’BOYLE, Appellee.
    No. 16982.
    Court of Civil Appeals of Texas. Dallas.
    Nov. 3, 1967.
    Rehearing Denied Dec. 1, 1967.
    Paul H. Stanford, of Cervin & Stanford, Dallas, for appellant.
    Charles Tobin, Elihu Berwald, Dallas, for appellee.
   CLAUDE WILLIAMS, Justice.

Appeal from summary judgment. The facts are undisputed and the question presented is one of law.

On August 16, 1957 Jim O’Boyle pledged to Harry M. Stanfield certain shares of stock in consideration of a loan in the sum of $50,000. On January 25, 1958, Stanfield released the stock to O’Boyle in consideration of the execution by O’Boyle of an agreement to substitute certain real estate for the shares of stock. Stanfield thereafter, on January 23, 1962, brought suit against O’Boyle alleging breach of the agreement and praying that O’Boyle execute a deed to the real estate in question or, in the alternative, for judgment in the amount of $52,050. Thereafter O’Boyle was adjudged to he a bankrupt and was discharged on September 1, 1964 by the bankruptcy court. In his schedule of obligations in the bankruptcy court O’Boyle listed the obligation owed to Stanfield. On November 16, 1966, Stanfield filed his first amended original petition in which he alleged that O’Boyle, in order to induce Stanfield to release the shares of stock, made false and fraudulent representations. Stanfield also countered O’Boyle’s discharge in bankruptcy contention by contending that since the property in question had been obtained by O’Boyle due to false pretenses or false representations the indebtedness was not discharged under the Bankruptcy Law of the United States. O’Boyle answered this amended petition by pleading the statute of limitations and further pleading that the indebtedness had been discharged in bankruptcy.

O’Boyle filed his motion for summary judgment, supported by his affidavit relating to his discharge in bankruptcy and attached thereto an order of the referee in bankruptcy granting discharge on September 1, 1964. Stanfield filed his affidavit in opposition to the motion in which he alleged that he did not become aware of the fraud practiced upon him by O’Boyle until shortly before the suit was instituted. The court sustained O’Boyle’s motion for summary judgment and in doing so expressly found that there was an absence of any genuine issue of fact and that “said cause is barred by the statute of limitations.” Judgment was accordingly entered that Stanfield recover nothing against O’Boyle.

Appellant, in two points of error, assails the judgment as being erroneous for the reason that, as a matter of law, his cause of action was not barred by the statute of limitations and that since the matter involved fraud the discharge in bankruptcy was ineffective as to the obligation involved.

As to the question of limitation of action both parties concede that the original action was governed by the terms of Art. 5527(1), Vernon’s Ann.Civ.St. of Texas, providing that actions founded upon any contract in writing must be brought within four years after the cause of action shall have accrued. The suit was instituted a few days prior to the expiration of the four-year period. The amendment to the petition, wherein for the first time fraud was alleged, was made on November 16, 1966, some four years and nine months after the accrual of the cause of action. Appellee does not challenge appellant’s statement of the law that the statute of limitations which governs actions based on fraud commences to run from the time of the discovery of the fraud. Anderson v. Wise, 345 S.W.2d 803 (Tex.Civ.App., Eastland 1961), affirmed Wise v. Anderson, 163 Tex. 608, 359 S.W.2d 876 (1962).

Appellant contends that pursuant to the terms of Art. 5539b, V.A.C.S., his amendment to the original petition was not wholly based upon or grew out of a new, distinct or different transaction or occurrence, and therefore was not barred by the terms of the four year statute of limitations. Appel-lee disputes this position by contending that since the amendment presented a tort action rather than one on contract the same amounted to a new suit and was therefore subject to the limitations statute. In support of his contention appellee relies almost exclusively upon the rule announced in Hopper v. Hargrove, 154 S.W.2d 978 (Tex. Civ.App., Texarkana 1941, writ ref’d). This case, though decided in 1941, followed the decision of the Supreme Court in Phoenix Lumber Co. v. Houston Water Co., 94 Tex. 456, 61 S.W. 707 (1901), which was decided prior to the enactment of Art. 5539b, V.A. C.S. In the Hopper case the court held that the amended petition had the effect of changing the cause of action and that therefore Art. 5539b, V.A.C.S., did not operate to avoid the bar of limitation. Appellee makes the same contention here, namely, that since the original action was based upon a breach of contract the filing of the amended petition, founded in tort, is insufficient to bring the case within the rule of the statute involved.

Our Supreme Court in a number of cases has decided that the “cause of action” concept as illustrated by the Phoenix Lumber Company and the Hopper cases mentioned above is not the true test to apply to Art. 5539b, V.A.C.S. The true test, says the Supreme Court, is whether the cause of action set forth in the amendment is based upon or grows out of a “new, distinct or different transaction and occurrence.” Global Corporation v. Vincent, 156 Tex. 398, 295 S.W.2d 640 (1956); Hallaway v. Thompson, 148 Tex. 471, 226 S.W. 2d 816 (1950); First State Bank & Trust Co. of Rio Grande City v. Ramirez, 133 Tex. 178, 126 S.W.2d 16 (1939).

In the very recent case of Leonard v. Texaco, Inc., 422 S.W.2d 160, opinion delivered June 14, 1967, motion for rehearing overruled with written opinion, October 4, 1967, our Supreme Court, speaking through Mr. Justice Norvell, reannounced the rule, as follows:

“The test under Article 5539b as amended in 1931 is no longer based upon a difference in causes of action declared upon in the original and amended petitions and the expressions contained in Hopper v. Hargrove, supra, indicating the contrary must be disapproved. The test is whether the cause of action alleged in the amended petition is ‘wholly based upon and grows out of a new, distinct or different transaction and occurrence.’ ”

The court pointed out that while it is true that the original cause of action was founded in contract and the amended cause of action was based upon tort both actions grew out of the same occurrence or transaction and that the difference in the actions would have little practical effect so far as trial preparation is concerned.

The present case is ruled by the decisions of our Supreme Court, cited above. Both the original cause of action as well as that set forth by the amendment obviously grew out of the same transaction or occurrence and therefore fall within the purview of Art. 5539b, V.A.C.S.

The trial court was in error in holding that the four year statute of limitations was applicable to the amended . cause of action. Since the amended cause of action is valid and presents questions concerning the obtaining of the property by fraudulent transactions the discharge in bankruptcy may very well not be applicable to relieve appellee of liability. Title 11, § 35, Sub-paragraph (a) of the United States Code, dealing with bankruptcy, provides:

“A discharge in bankruptcy shall release a bankrupt from all of his provable debts, whether allowable in full or in part, except such as * * * (2) are liabilities for obtaining money or property by false pretenses or false representations * * * »

Since the trial court was in error in granting the motion for summary judgment, the judgment based thereon must be reversed and remanded.

Reversed and remanded.

       “Whenever any pleading is filed by any party to a suit embracing any cause of action, cross-action, counterclaim, or defense, and at the time of filing such pleading such cause of action, cross-action, counterclaim, or defense is not subject to a plea of limitation, no subsequent amendment or supplement changing any of the facts or grounds of liability or of defense shall be subject to a plea of limitation, provided such amendment or supplement is not wholly based upon and grows out of a new, distinct or different transaction and occurrence. Provided, however, when any such amendment or supplement is filed, if any new or different facts are alleged, upon application of the opposite party, the court may postpone or continue the case as justice may require.”


author: BATEMAN, Justice.

text:
    GREENVILLE AVENUE STATE BANK, Appellant, v. Harold E. LANG, Appellee.
    No. 16983.
    Court of Civil Appeals of Texas. Dallas.
    Nov. 10, 1967.
    Rehearing Denied Dec. 8, 1967.

      Wm. F. Billings and Charlie R. Wise, of Billings, Pierce, Gilley & Stanton, Dallas, for appellant.
    W. A. Pritchard, of Bradford & Pritch-ard, Dallas, for appellee.
   BATEMAN, Justice.

The appellant Greenville Avenue State Bank appeals from a summary judgment rendered against it in favor of the appellee Harold E. Lang for the amount of a $3,000 check drawn by Lang on the Bank and paid by it on what Lang claims is a forged endorsement.

Appellee relies on the general rule that a bank may not charge against its depositor the payment of any check on the forged endorsement of the payee, 8 Tex. Jur.2d, Banks, § 268, p. 451, and that the bank is under a duty to ascertain the existence and identity of the payee, and must at its peril determine the genuineness of his endorsement before paying the check. Guaranty State Bank & Trust Co. v. Lively, 108 Tex. 393, 194 S.W. 937, L.R.A.1917E, 673 (1917); 10 Am.Jur.2d, Banks, § 623, p. 587. However, appellant denies that the endorsement was unauthorized, thus placing the burden on Lang, in these summary judgment proceedings, of showing, not only that the endorsement was actually unauthorized, but that there is no competent evidence to the contrary.

It appears from the undisputed facts that the check was given under the following circumstances: On January 16, 1965 Lang was introduced to one E. W. Chaffin by a Mr. Vaughn, whom Lang had known for several years. Purporting to act as president of Motel Systems, Inc., Chaffin entered into a written contract with Lang, which provided for the purchase by Lang of a 10 per cent “equity” in a proposed new motel to be constructed in Pocatello, Idaho for a consideration of $30,000, of which $7,500 was payable on signing the contract and the balance in future installments. Vaughn had purchased a 10 per cent “equity” in a proposed new motel in another town, and at his suggestion Lang wrote two checks and handed them to Chaffin, one for $4,500 payable to Motel Systems, Inc., and the other, being the check in question, payable to the order of “Quality Courts Motel” in the sum of $3,000. The $3,000 check was endorsed “Quality Courts Motel by E. W. Chaffin” and deposited by Chaffin in the First National Bank of Arizona in an account he had opened entitled “Pocatello Quality Courts Motel.” Both checks cleared in the usual way and were paid by appellant and charged to Lang’s account.

Seven or eight months thereafter Lang wrote Chaffin that because of his wife’s poor health he desired to rescind the contract, to which Chaffin agreed, promising to refund the money paid by Lang within sixty days. This was not done and Chaffin could not thereafter be located.

In determining whether Lang has carried the burden of showing that there was no genuine issue as to any material fact and that he was entitled to a judgment as a matter of law, we must view all of the evidence presented in the light most favorable to the Bank and resolve against Lang all doubts as to the existence of a genuine issue as to a material fact. If the motion for summary judgment involves the credibility of affiants or deponents, or the weight of the evidence or a mere ground of inference, the motion should not have been granted. In passing on summary judgment motions the court must disregard all conflicts in the evidence and must accept as true the evidence which tends to support the position of the party opposing the motion; and evidence which favors the mov-ant’s position may not be considered unless it is uncontradicted; and if such uncontra-dicted evidence is from the movant himself, it cannot be considered as doing more than raising an issue of fact unless it is clear, direct and positive and there are no circumstances in evidence tending to discredit or impeach such testimony. Great American Reserve Ins. Co. v. San Antonio Plumbing Supply Co., 391 S.W.2d 41, 47 (Tex.1965) and the cases cited therein.

By its first point of error the appellant Bank contends that the pleadings, affidavits and depositions on file presented a material fact issue as to whether the endorsement on the $3,000 check was unauthorized. Under the record presented here, and in the light of the foregoing guidelines laid down by our Supreme Court, this point must be sustained. The only authority any Texas trial court has for granting a summary judgment is found in Rule 166-A, Vernon’s Texas Rules of Civil Procedure. Subdivision (e) of that rule is, in part:

“Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein/’

Thus, affidavits based on hearsay or conclusions of law or of fact are insufficient to support the granting or overruling of a motion for summary judgment. Harang v. Aetna Life Ins. Co., 400 S.W.2d 810, 814 (Tex.Civ.App., Houston 1966, writ ref’d n. r. e.); Tall Timbers Corp. v. Ander son, 370 S.W.2d 214, 222 (Tex.Civ.App., Fort Worth 1963, reversed on other grounds Tex., 378 S.W.2d 16); Sparkman v. McWhirter, 263 S.W.2d 832, 838 (Tex.Civ.App., Dallas 1953, writ ref’d).

Lang presented his own affidavit to the effect that at the time in question he maintained a checking account at the appellant Bank and had on deposit therein more than $3,000; that on January 16, 1965 he was desirous of purchasing a Quality Courts Motel franchise to be operated in Pocatello, Idaho, and on said date issued his check to Quality Courts Motel for $3,000; that “Quality Courts Motel, Inc. is commonly known as Quality Courts Motel”; that the check was never delivered to “Quality Courts Motel, Inc.,” and that “they” refused to issue to him the desired franchise; that the $3,000 check was charged against his account at the appellant Bank, and that he received no consideration or benefit therefrom.

He also presented the affidavits of two officers of Quality Courts Motels, Inc., William A. Harwood, the General Manager— Administration, and Kenneth L. Horstmyer, the Executive Vice-President. Harwood’s affidavit states that he is an adult, having never been convicted of a crime, and that he has personal knowledge of all the statements therein made; that Quality Courts Motels, Inc. is commonly known as Quality Courts Motel; that E. W. Chaffin has never been an employee of Quality Courts Motels, Inc. and has never been authorized or empowered by said corporation “to endorse checks made out to Quality Courts Motels, Inc.” It may have been mere inadvertence, but the failure of this affidavit to say anything about Chaffin’s authority or lack of authority to endorse a check made payable, as the one in question here was, to Quality Courts Motel creates at least some reasonable doubt in our minds. If the affiant intended to negate such authority he could easily have said so.

Horstmyer’s affidavit cannot properly be considered as establishing the facts stated therein because it fails to show affirmatively that the affiant is personally familiar with those facts or that he is competent to testify thereto as a witness. He says that Chaffin had no authority to endorse the check in question, but he does not inform us what the source of his information is; i. e., whether he has personal knowledge of the lack of authority, or whether it is based on hearsay, or whether it is a conclusion based upon other information he may have which might or might not have been admissible evidence. Gardner v. Martin, 162 Tex. 156, 345 S.W.2d 274 (1961); Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230 (Tex.1962); Boswell v. Handley, 397 S.W.2d 213 (Tex.1965).

Moreover, it is our view that Lang’s uncorroborated affidavit falls within the general rule that evidence given by a party or other interested witness, even though uncontradicted, merely presents a fact issue to be determined by the jury. Mills v. Mills, 228 S.W. 919 (Tex.Com.App. 1921, jdgmt. adopted; Id., 111 Tex. 265, 231 S.W. 697); Missouri-Kansas-Texas Railroad Co. v. McFerrin, 156 Tex. 69, 291 S.W.2d 931, 940-941 (1956); Barker v. Coastal Builders, 153 Tex. 540, 271 S.W.2d 798, 802-803 (1954); Owen Development Co. v. Calvert, 157 Tex. 212, 302 S.W.2d 640 (1957).

The affidavit is not so clear, direct and positive, and free from inaccuracies, as to establish as a matter of law that the endorsement was unauthorized. See Cochran v. Wool Growers Central Storage Co., 140 Tex. 184, 166 S.W.2d 904, 908 (1942) ; McGuire v. City of Dallas, 141 Tex. 170, 170 S.W.2d 722, 728 (1943).

The affidavit is not strengthened by the opportunity of the Bank to contradict or impeach it and its failure to do so. The test of whether the endorsement was forged is: Was it made by the person intended by the maker to be the payee? 9 C.J.S. Banks and Banking § 356, pp. 737-738. A bank would seldom, if ever, be able to contradict a depositor’s statement of his own intention in such a matter.

In our opinion, the evidence proffered by Lang was not sufficient to establish that there was no genuine issue as to whether the endorsement was authorized, or to establish as a matter of law that appel-lee was entitled to a judgment. For example, it was not shown by competent evidence why the $3,000 check was made payable to Quality Courts Motel. The written contract signed by Lang and Chaffin does not mention Quality Courts Motel. The only reference it contains to a national franchise from anyone is the provision, “MOTEL SYSTEMS, INC. to make available (where possible) a national franchise, * * * ” jj. js true that Lang testified in his oral deposition that “Mr. Vaughn suggested that I make the checks out the same as this because that’s the way he had made his out. This was to be for a franchise.” He also testified: “I thought he [Chaffin] would send it on to Quality Courts, which to my idea anybody could purchase a franchise from them if they had the $3,000.” He also testified that he knew that Quality Courts Motel “is a franchise motel system and they do not operate under the name of Incorporated,” and that he got this information from one of their own pamphlets. He also testified that the $3,000 was to cover the franchise and that he thought the franchise was being purchased from Quality Courts Motel. However, these are all conclusions on the part of the witness and would not be admissible in evidence on a trial of the case. Therefore, they cannot be considered in support of the summary judgment in view of the requirements of Subdivision (e) of Rule 166-A.

Appellee’s argument that he was obviously the victim of a confidence man who forged the name of the payee in the check in question may very well be based on actual fact; but when we view the evidence in the light most favorable to appellant, and resolve all doubts as to the existence of a genuine fact issue against appellee, we cannot say that the record presented to us is sufficient to support the summary judgment as a matter of law. Accordingly, appellant’s first point of error on appeal is sustained.

We have carefully examined appellant’s other four points of error on appeal, but find no merit in any of them. It would add nothing to the jurisprudence of the state for us to discuss them, and they are overruled.

The judgment is reversed and the cause remanded for trial on the merits.

Reversed and remanded.