author: MURRAY, Chief Justice.

text:
    LAWYERS SURETY CORPORATION, Appellant, v. INVESTORS MUTUAL OF NUECES, INC., Appellee.
    No. 13851.
    Court of Civil Appeals of Texas. San Antonio.
    Jan. 10, 1962.
    Rehearing Denied Feb. 14, 1962.
    Lawrence W. Vance, Dallas, Lewright, Dyer & Redford, Corpus Christi, Edward P. Fahey, San Antonio, for appellant.
    Harold Alberts, Corpus Christi, for ap-pellee.
   MURRAY, Chief Justice.

This suit was instituted on October 11, 1960, in the District Court of Nueces County, Texas, by Investors Mutual of Nueces, Inc., against Lawyers Surety Corporation, Automatic Transmission, Inc., and R. H. Williams, seeking to recover the sum of $2,377.99, alleged to be due to plaintiff by defendants. On November 10, 1960, plaintiff filed a motion for summary judgment, duly supported by affidavit. The motion was set for hearing on December 1, 1960. On that date, the defendants Automatic Transmission, Inc., and R. H. Williams having made no reply to plaintiff’s motion for summary judgment, the motion was granted and an interlocutory summary judgment rendered against both of these defendants. These defendants have not appealed, and such judgment as to them has become final.

Lawyers Surety Corporation did appear, and filed a written motion to postpone the hearing on the motion for a summary judgment, which motion was granted, and the hearing postponed as to it until December 16, 1960.

Lawyers Surety Corporation did not, prior to December 16, 1960, the day to which the hearing had been postponed, file an opposing affidavit, as is permitted by Rule 166-A, Texas Rules of Civil Procedure, but on that date did file its “First Amended Original Answer” alleging, among other things, “that the Investors Mutual of Nue-ces, Inc., did (not), within one hundred (100) days of the discovery of loss, furnish to the Defendant, Lawyers Surety Corporation, an affirmative proof of loss with full particulars in writing, including dates and items of loss, duly sworn to, and did in this respect fail to comply with Section B, Paragraph First, of said indemnity bond.” This part of the amended answer was sworn to by James W. Wray, Jr., one of the attorneys for the defendant. Plaintiff’s motion for summary judgment against this defendant was then granted and judgment in the sum of $2,377.99 rendered against Lawyers Surety Corporation, and the interlocutory judgment against the other two defendants was made final. Lawyers Surety Corporation alone has prosecuted this appeal.

The liability against Lawyers Surety Corporation is based upon its signing as surety an Indemnity Bond reading in part as follows:

“INDEMNITY BOND
“WHEREAS, AUTOMATIC TRANSMISSION, INC., and R. H. WILLIAMS, both of Corpus Christi, Texas, are selling accounts receivable to INVESTORS MUTUAL OF NUE-CES, INC; and
“WHEREAS, protection against acts of fraud on the part of these sellers is desired;
“NOW, THEREFORE, in consideration of the premises, AUTOMATIC TRANSMISSION, INC., and R. H. WILLIAMS, as Principals, and LAWYERS SURETY CORPORATION, as Surety, hereby agree to pay unto INVESTORS MUTUAL OF NUECES, INC., within ninety (90) days after proof of loss as hereinafter set forth, the amount of all direct losses not to exceed the sum of FIVE THOUSAND ($5,000.00) DOLLARS, which the said AUTOMATIC TRANSMISSION, INC. and R. H. WILLIAMS may cause to the said INVESTORS MUTUAL OF NUECES, INC. by reason of larceny, theft, embezzlement, forgery, misapplication, wrongful abstraction, wilful misapplication or any other act of fraud or dishonesty committed by Principals during the term of one year from date hereof in connection with the transactions relating to the sale of accounts receivable, and which losses shall be discovered by the obligee before the expiration of two (2) years from the termination or cancellation of this bond, whichever shall first occur.
“This bond is executed and accepted subject to Sections A and B hereof. * * ⅜
“SECTION B First: — Within 100 days after discovery of loss hereunder by the Obligee, or, if a corporation, by any director thereof, or by any officer thereof, not in collusion with the Principals, the Obligee shall furnish to the Surety affirmative proof of loss with full particulars in writing, including dates and items of loss, duly sworn to.
“Second: — Legal proceedings for recovery of loss under this bond shall not be brought after the expiration of 28 months after the cause of action shall have accrued.
“IT IS FURTHER SPECIFICALLY AGREED AND UNDERSTOOD that this bond in no way guarantees the collectibility of any account receivable but covers only acts of fraud committed by Principal in connection with same.”

Appellant, Lawyers Surety Corporation, contends that the court erred in granting summary judgment against it based upon the motion and affidavit filed by appellee, Investors Mutual of Nueces, Inc.

As was contemplated by the parties when the indemnity bond was executed, Investors Mutual of Nueces, Inc., purchased from R. H. Williams and Automatic Transmission, Inc., an account receivable payable by Reynolds Metals Company in the sum of $3,377.99. Thereafter this account was paid to R. H. Williams and Automatic Transmission, Inc., by Reynolds Metals Company, but the proceeds thus collected were not paid to Investors Mutual of Nueces, Inc. Appellee did not discover this defalcation on the part of Williams and Automatic Transmission, Inc., until June 7, 1960. The supporting affidavit attached to appellee’s motion for summary judgment shows that thereafter they notified E. S. Prashner Insurance Company, the agent of appellant, and that thereafter the adjusting firm of Boyd & Easley undertook to adjust this matter with appellee. Thereafter Williams and Automatic Transmission, Inc., agreed to pay $1,000.00 as part payment of this defalcation, which was accepted by appellee, with the approval of all parties concerned, and the amount of damages was thus reduced to $2,377.99.

With reference to whether or not appellant was furnished with a proof of loss, the supporting affidavit contains the following statement:

“That shortly after the 7th day of June, to-wit: on the 9th day of June, 1960, the said Firm of Boyd & Easley prepared a Proof of Loss which the Plaintiff, acting through its President, Monroe Horn, executed and delivered to the said Firm of Boyd & Easley. That thereafter, the said Lawyers’ Surety Corporation corresponded with its agent, and with Boyd & Easley, the adjusters, and with the Defendant, R. H. Williams, and Automatic Transmission, Inc., all with reference to said loss and defalcation, but said Lawyers’ Surety Corporation did wholly fail to correspond directly with the Plaintiff, or advise him whether they would or would not pay said claim until many weeks thereafter. That by letter dated August 19, 1960, Lawyers’ Surety Corporation urged the Plaintiff Investors Mutual of Nueces, Inc. to accept a partial payment of the defalcation from Raymond H. Williams, after considerable negotiations between Lawyers Surety Corporation and the attorney for Raymond H. Williams.
“That Boyd & Easley advised the Plaintiff that Lawyers’ Surety Corporation had contacted the said Firm of Boyd & Easley and that Lawyers’ Surety Corporation would shortly ther-after contact the Plaintiff concerning said loss. That such notification was received on or about the 14th day of June, 1960, and that although the Plaintiff waited, he received no word directly from Lawyers’ Surety Corporation whatsoever. That about the middle of June, 1960, the sworn Proof of Loss executed by Plaintiff and given to Plaintiff’s agent was forwarded to Lawyers’ Surety Corporation.
“That after the payment of One Thousand Dollars ($1,000.00) of the loss by R. H. Williams and Automatic Transmission, Inc., and after receiving no further direct written word from Lawyers’ Surety Corporation, Plaintiff filed a second Proof of Loss, a copy of which is attached hereto and labeled Exhibit ‘C’; and which Proof of Loss was sent to the Defendant, Lawyers’ Surety Corporation, on the 28th day of September, 1960, and received by them on the 29th day of September, 1960.
“That at all times on and after the '8th day of June, 1960, Lawyers’ Surety Corporation has been well aware of the defalcation and has never sought any additional information whatsoever from the Plaintiff, but without cause, justification or excuse, has remained silent and taken no action with reference to paying its obligation under the terms of the Bond, or acknowledging it.”

The supporting affidavit filed by .appellee was not replied to or contradicted by any opposing affidavit filed by appellant. The affidavit of appellee, which was unanswered, was sufficient to require the ■court to render the summary judgment which it did. Appellant contends that its ■sworn answer filed on the day the motion for summary judgment was heard, was sufficient to contradict the supporting affidavit, ■was sufficient to show that there were fact issues to be decided, and that summary judgment was therefore improper. We do not agree. Rule 166-A, T.R.C.P., requires in effect that opposing affidavits must be ■served prior to the day set for the hearing •of a motion for summary judgment. The amended answer filed by appellant on the day of hearing came too late to be regarded .as an opposing affidavit. Furthermore, it is signed by one of the attorneys in the •case, and does not show affirmatively that the attorney was competent to testify to the matters stated therein, as is required by -.the Rule. It will further be noted that the allegations contained in appellant’s first amended original answer do not state that no notice of loss was furnished appellant within 100 days, but only that no affirmative proof of loss with full particulars in writing, including dates and items of loss, was furnished within 100 days. Even if this allegation was considered as an opposing affidavit, it does not sufficiently contradict the affidavit of appellee to raise an issue of fact in this case, because it fails to show any injury to appellant resulting from the incompleteness of the proof of loss.

The judgment of the trial court is affirmed.


source: Caselaw Access Project

author: WERLEIN, Justice.

license: Public Domain

text:
    TEXARKANA WATER SUPPLY CORPORATION, Appellant, v. L. E. FARLEY, INC., et al., Appellees.
    No. 13869.
    Court of Civil Appeals of Texas. Houston.
    Jan. 25, 1962.

      Raffaelli & Keeney, John D. Raffaelli, Texarkana, for appellant.
    Liddell, Austin, Dawson & Sapp, W. Robert Brown, Houston, for appellees.
   WERLEIN, Justice.

This is an appeal from an order overruling appellant’s plea of privilege. Appellees, L. E. Farley, Inc., a corporation with its principal office and place of business in Houston, Harris County, Texas, and C. M. Ham, d/b/a Ham Construction Company, a resident of Harris County, filed suit against Texarkana Water Supply Corporation, a corporation formed and owned by the City of Texarkana, Texas, with its principal office and place of business in Bowie County, Texas, the American National Bank & Trust Company of Chicago, a national banking corporation having its residence and domicile in Chicago, Cook County, Illinois, and the Texarkana National Bank, a national banking corporation having its residence and domicile in Texarkana, Bowie County, Texas, to recover from appellant certain damages alleged to have been incurred in connection with a contract between appellant, Texarkana Water Supply Corporation, as owner, and appellees as sontractors, covering the construction of a raw water supply line to serve the municipally owned water system of Texarkana, Texas. Each of the defendants filed a plea of privilege, but only appellant’s plea was set for hearing since the co-defendant banks waived their pleas by filing motions for summary judgment which were overruled.

The co-defendants are trustees under a deed of trust relating to the property in question, and are agents and attorneys in fact for the beneficiaries and bond holders under the deed of trust. Appellees also seek foreclosure of their constitutional and statutory mechanics’ and materialmen’s liens together with a determination that same are prior and superior to any right or claim of co-defendants to the property in question. It will be unnecessary to discuss this phase of the case in view of our holding herein.

The evidence shows that the City of Tex-arkana, Texas, has owned and operated its municipal water system since 1948. Being unable to issue additional bonds because the revenue from its water system did not permit, the City, in order to enlarge its water system, formed or caused to be formed in 1957 The Texarkana Water Supply Corporation, under Art. 1434a, Vernon’s Annotated Texas Civil Statutes, as amended, for the purpose of obtaining funds through the sale of bonds of such corporation. Upon learning that appellant was inviting bids on a raw water transmission pipe line, ap-pellees obtained copies of the plans, specifications and bidding documents. They inspected the terrain over which the line was staked and made certain investigations pri- or to submitting their bid which was accepted. They contend that they submitted their bid in reliance on the misrepresentation in the bidding documents that appellant “has obtained” right of way. The provision in question reads:

“RIGHT OF WAY: The owner will provide all necessary right-of-way along the route of the water supply line. The wi-ith of right-of-way on private property will be thirty (30') feet normally; however, the Owner has obtained an easement for construction purposes of fifty (50') feet. * * *

Appellees allege in their petition an alternative cause of action for damages based on fraud committed in Harris County, and in their controverting affidavit they plead that venue was properly laid in Harris County by virtue of Subdiv. 7 of Art. 1995, which provides that in all cases of fraud suit may be brought in the county where the fraud was committed. The allegations concerning fraud are sufficiently pleaded by appellees. It is appellant’s contention, however, that the use of the words “has obtained” in the provision hereinabove set out was a mere clerical error; that the contract was made in Bowie County and no fraud was committed in Harris County; that even if there was a misrepresentation in the bidding documents, there is nothing to show that appellees were misled as to the easements; that by suing on the contract, appellees have waived any alleged fraud in its inducement; and that fraud is not the gist of appellees’ cause of action.

There is nothing to show that the misrepresentation contained in the provision hereinabove set out, was a mere clerical error or that the provision is ambiguous. It clearly states that the owner “has obtained” an easement for construction purposes of 50 feet. This statement does not conflict with the first part of the provision that the owner will provide all necessary right of way and that the right of way on private property will be 30 feet normally. The representation is contained in the special provisions of the document distributed to induce bidders. There can be no question as to the materiality of the representation or as to damages suffered by appellees.

We do not think appellees waived fraud by suing alternatively for breach of contract. They were careful to plead in the alternative the different grounds or theories upon which they relied for recovery. Fraud is the gist of the cause of action in their pleading alleging the elements of fraud and the damages suffered by them as a result thereof, and indeed the alleged misrepresentation is the gist of the entire action. Under Rule 48, Texas Rules of Civil Procedure, “A party may set forth two or more statements of a claim or defense alternatively or hypothetically, either in one count or defense or in separate counts or defenses.”

The cases relied upon by appellant are factually inapplicable to the present case.. In Caprock Machinery Company v. Boswell, Tex.Civ.App.1958, 318 S.W.2d 669,, writ dism., the court was of the opinion that appellee didn’t show any fraud and especially he did not show that any fraud' was committed in Gray County where the suit was brought, but if such were not so,, venue could not be sustained in the county where the fraud was alleged to have occurred in inducing the execution of the contract because where one sues for breach-of contract he waives the fraud as a fact in fixing venue. In that case there was no alternative cause of action pleaded as there-is in the present case. In the cases cited by-appellant an election had been made by the plaintiff to sue for breach of contract, and' not to sue alternatively for damages resulting from fraud. See Hopcus v. Tredway, Tex.Civ.App.1951, 244 S.W.2d 857, and cases cited.

In Cockburn v. Dixon, 1953, 152 Tex. 572, 261 S.W.2d 689, the court in effect held' that under Art. 4004, V.A.T.S., the cause-of action was for fraud and not for breach of contract and hence the lower court in overruling defendant’s plea of privilege-properly applied Subdiv. 7, Art. 1995.

We think it would serve no useful1 purpose to discuss the other cases cited by appellant. The holdings in such cases merely support the general rule which is. well settled, that even though a contract may have been induced by fraud, if the -innocent party elects to sue on the contract rather than to recover damages for the fraud, he cannot rely on the fraud to fix the venue of his suit. Bunger v. Campbell, Tex.Civ.App., 183 S.W.2d 1001, and cases cited. Murray v. Frankland, Tex.Civ.App., 347 S.W.2d 374. These cases do not in any way militate against our conclusion that where the plaintiff pleads in the alternative two independent causes of action or theories relied upon for recovery, one for damages resulting from fraud and the other for breach of contract, whether in one count or separate counts, venue may be sustained in the county where it is alleged and established the fraud was committed. The plaintiff is not required to elect at the hearing on the plea ■of privilege the cause of action, claim or count that he may ultimately decide to rely upon for recovery when the case is tried on the merits. As stated in McDonald, Texas -Civil Practice, Vol. 2, p. 571, § 6.20:

“Wisely disregarding ancient prejudices against alternative pleading, the appellate courts of Texas traditionally have allowed the plaintiff great freedom in the allegation of multiple theories of recovery * * * Two intensely practical considerations support this rule. In the first place, a plaintiff with a single claim may be uncertain either as to the fact propositions which may be established at the trial, or as to the rules of substantive law which the court will deem applicable to the established facts, and therefore, in order to hedge against all contingencies, may need to plead his claim to fit multiple theories and often seek alternative and inconsistent relief.”

In further support of the above conclusion, see Rawlins v. McIntyre, Tex.Civ.App. 1959, 330 S.W.2d 524; Murray v. Frankland, supra; Cockburn v. Less, Tex.Civ.App., 257 S.W.2d 470, 475-476.

It is our view that there is evidence supporting the trial court’s presumptive finding that the alleged fraud was committed in Harris County. The booklet circulated by appellant to appellees and other prospective bidders contained the written misrepresentation. The evidence shows that on July 11, 1957, after appellees’ bid had been accepted, the unsigned contracts were mailed in Fort Worth by Freese & Nichols, consulting engineers representing appellant, to appellees in Houston where they were signed by appellees. The testimony of Mr. Mahon, the representative of appellee Farley, that the false representation in the bidding documents was read and relied upon by appellees in Houston, is uncontroverted. It establishes that the fraud was committed in Harris County. In Brown v. Gray & Wilmerding, Tex.Civ.App., 256 S.W. 977, this Court said: “Nor can it be doubted, we think, that the fraud thus appearing was committed in Harris county, where the letter embodying it was received and acted upon. Commercial Nat. Bank v. First Nat. Bank (Tex.Civ.App.) 77 S.W. 239.”

Appellant asserts that even if ap-pellees were misled by the false representation when preparing their bid, the evidence shows that after the bids were opened, for a period of five days when the specifications and plans were being revised and changed so as to bring the total of the low bids within the amount of money available, the question of procuring the easements and the time it would take to procure them and the cost thereof, was discussed time and time again, and that at such conferences appellee Ham or other representatives of appellees were present, and that no attempt is made by ap-pellees to prove that such representatives did not hear such conversations. The trial court presumptively found that appellees were not informed of the true facts concerning the right of way prior to signing the contract and beginning the construction of the pipe line. The court heard all the evidence and resolved the conflict in ap-pellees’ favor in overruling the plea of privilege. In the absence of findings of fact and conclusions of law, this Court is required to affirm the judgment of the trial court if it may do so upon any theory oí the case finding support in the evidence. Rawlins v. McIntyre, supra; Loggins v. Stewart, Tex.Civ.App., 218 S.W.2d 1011, writ ref.; La Force v. Bracken, Tex.Civ.App., 163 S.W.2d 239, aff’d 1943, 141 Tex. 18, 169 S.W.2d 465.

We think there was ample evidence supporting the court’s resumed finding that appellees did not have knowledge prior to beginning construction that the right of way had not been obtained. Mr. Mahon testified that at the July meeting at the Water Company in Texarkana what he understood about the easements was to the effect the right of way would be no problem; that he asked the Farley men around there what was told them at the bidding about the right of way, and they answered that they were told the right of way would be no problem. Mr. Shirley, a former employee of Farley, and superintendent in general charge of the construction project in question, testified that he seemed to remember the reference made that the right of way is no problem. We are of the view that there is no conflict in the statements that the right of way has been obtained and that the right of way is no problem.

There is evidence that appellees were not aware that the right of way had not been obtained until after they had been ordered to commence the work on August 23, 1957, and had “rigged up” for the job with heavy construction equipment and had started bulldozers clearing the right of way for trenching. After clearing approximately 3300 feet of right of way, appellees were halted in their construction because the right of way had not been obtained. Mr. Shirley testified that before that date, August 27, 1957, he had no idea that right of way was not available. The evidence also shows that on November 4, 1957, Mr. Mahon complained to Mr. Norton, the resident engineer of Freese & Nichols, that the specifications stated the City had the right of way before the contract was let. Mr. Mahon testified in substance that if Mr. Norton did not relay such complaint in November, 1957, then April was the first time he (Mahon) told any official of appellant that appellees had been misled by the specifications.

The evidence amply supports the trial court’s presumed finding not only that appellees had moved heavy construction equipment including bulldozers to the site of the work, and had cleared 3300 feet of right of way before ascertaining that the right of way easements had not been obtained, but also the presumed finding that appellees did not waive their cause of action for fraud by completing the construction since the contract had been partly executed by appellees and they had changed their position for the worse prior to discovery of the fraud. Thrower v. Brownlee, Tex.Com.App.1929, 12 S.W.2d 184, and cases cited; Andrews v. Powell, Tex.Civ.App.1951, 242 S.W.2d 656. See also 26 Tex.Jur.2d, p. 37, § 89, where it is stated: “However, affirmance of a partly executed contract does not, ordinarily, preclude the defrauded party from recovering damages for the fraud.”

In view of our holding with respect to venue being established in Harris County, under Subdiv. 7 of Art. 1995, V.A.T.S., we find it unnecessary to discuss appellant’s other points or the additional grounds relied upon by appellees in support of the judgment of the trial court.

Judgment affirmed.


author: ARCHER, Chief Justice.

text:
    Avon A. TURNER, Appellant, v. TEXAS DEPARTMENT OF PUBLIC SAFETY, Appellee.
    No. 10923.
    Court of Civil Appeals of Texas. Austin.
    Jan. 31, 1962.
    J. Kenneth Brewer, San Antonio, for appellant.
    No brief filed by appellee.
   ARCHER, Chief Justice.

This is an appeal from an order of the County Court holding that all questions were moot and that the Court did not have jurisdiction over the cause.

The appeal to the County Court was from an order claiming that appellant’s license was suspended.

It appears that on August 27, 1957 an order of the Safety-Responsibility Division of the Department of Public Safety, suspended the license of appellant. Neither the original of this order nor a certified copy of such was introduced into evidence. Appellant1 testified that he did not receive a copy of the order and that the first he knew of such order was in January, 1960, and that he was not advised to comply with the provisions of Vernon’s Ann.Civ.St., Article 6701h et seq. with reference to the making of a deposit of a sum of money with the Department or to show proof of his ability to satisfy any judgment that might be rendered against him as the result of Court action growing out of an accident which occurred on March 21, 1957 in Bexar County, Texas. The Department claims that a copy of the suspension order was mailed to appellant at 309 Porter Street, San Antonio, Texas.

On a trial on March 21, 1961, Clyde D. Bennett, Sr., a Texas Highway Patrolman, testified that he had a police demand o.rder on appellant to pick up his driver’s license,' license plates and receipts on all cars owned by him and that appellant said that he would bring them to the office but never did. That this occurred on January 15, 1958. The witness testified that he did not have a copy of the accident report and had never seen one; that he did not have a copy of the suspension order and had no knowledge of it and did not give appellant a copy.

The appellant testified that he never was given any notice of any suspension by the Department of Public Safety and that he did not recall ever having talked to Bennett; that he had never seen a copy of the notice from the Department and first learned that there might be a suspension against him when he was arrested some time in January, 1958.

The appellant testified that he had not lived at 309 Porter Street since the latter part of 1940 and that his address was at 3914 Southwest Military Drive or 2102 West Commerce where he received his mail.

The Trial Court refused to find as a fact that a notice of the suspension order was ever given to appellant but did hold that the matter was moot and that the Court did not have jurisdiction. The Court further stated:

“As I see it, unless they have refused to issue him a license, I think, under the circumstances, he will have to comply with the law. He has a right that’s given to him by statute, and that is if there is no suit brought and no judgment rendered after a period of one year from the date of the accident, that in compliance with the law the department will issue him a license.”

The Court held that the plaintiff take nothing by his appeal and dismissed the cause for want of jurisdiction.

We do not believe that appellee, The Department of Public Safety, discharged its burden of proving by competent evidence that the suspension order dated August 6, 1957 was ever given the appellant Turner.

We have hereinabove set out in some detail the testimony given at the trial. So far as the record shows in this case no suit or claim has been made or reduced to judgment by anyone growing out of an alleged accident on March 21, 1957 and any amount of money required by the Department has been fixed.

The provisions of Article 6701h fix the procedure to be followed by the Department in the suspension of driver’s license, and the record is silent as to what the Department actually did, except for the statements by witness Bennett and these were based on hearsay testimony.

Section 2(b) and Section 2(c) provide for an appeal and place the burden, in a trial de novo, on the Department. Section 7 provides for the renewal of a license.

In a retrial of this case the Court should be governed by the holding of our Court of Criminal Appeals in Smith v. State, 168 Tex.Cr.R. 185, 324 S.W.2d 207 and by the decision of the Court of Civil Appeals in Gonzalez v. Texas Department of Public Safety, 340 S.W.2d 860.

The judgment of the Trial Court is reversed and this cause is remanded for trial on its merits within the wording of the statute.


author: DENTON, Chief Justice.

text:
    John I. BOWLING et ux. v. STATE of Texas.
    No. 7098.
    Court of Civil Appeals of Texas. Amarillo.
    Feb. 5, 1962.
    Benjamin Kucera, Lubbock, for appellants.
    Steve Hurt, Plainview, for appellee.
   DENTON, Chief Justice.

This is a condemnation proceeding appealed from the county court of Hale County, Texas. Appellee has filed a motion to dismiss this appeal. This motion, duly verified, sets out that since this appeal has been perfected the appellee tendered to appellants and appellants have voluntarily accepted all sums due under the judgment of the trial court. This motion has not been answered or contested by appellants. We must therefore proceed on the assumption the allegations therein are true.

The record reflects that the commissioners awarded appellants $23,500.00 and in due time appellants filed their objections to such award. Appellee subsequently deposited this amount into the registry of the court. Upon a trial de novo the jury assessed damages in the amount of $26,000.00. Appellee thereupon deposited an additional $2500.00 into the registry of the court, making the total amount deposited for the benefit of the appellants equal to the judgment award. Since this appeal was perfected appellants have accepted these checks, and photostatic copies of the two checks reflect that appellant John I. Bowling endorsed and cashed these checks on June 5, 1961.

The facts in respect to the withdrawal of funds in the instant case seem to be identical to the facts in the case of Latimer v. State (Civ.App.) 328 S.W.2d 242 (refused n. r. e.). The Beaumont Court of Civil Appeals, in dismissing the appeal,, followed the rule pronounced by the Supreme Court in Carle v. Carle, 149 Tex. 469, 234 S.W.2d 1002. It is well settled that a litigant can not accept the benefits of a judgment and thereafter prosecute an appeal therefrom. As stated on motion for rehearing in the Latimer case, supra, Article 3268 Vernon’s Ann.Tex.Civ.St. and cases thereunder allowing an appeal after a landowner has accepted the award of the commissioners are not controlling under the circumstances of the instant case. Here the amount tendered and accepted was the award by the court’s judgment.

The appeal is therefore dismissed at the cost of appellants.


text:
    MERCEDES DUSTING SERVICE, INC., Appellant, v. Kenton EVANS, d/b/a Kenton Evans Custom Furniture, Appellee.
    No. 13895.
    Court of Civil Appeals of Texas. San Antonio.
    Jan. 31, 1962.
    Smith, Mcllheran & Jenkines, Weslaco, for appellant.
    L. Aaron Pena, Edinburg, for appellee.
   MURRAY, Chief Justice.

This suit was instituted by Kenton Evans, doing business as Kenton Evans Custom Furniture, against Mercedes Dusting Service, Inc., seeking to recover the sum of $4.00 per hour for the man hours spent in repairing a Stearman airplane wing, alleged to have been agreed upon, and in the alternative for the reasonable value of his services. The trial court found that the defendant had not contracted to pay the sum of $4.00 per hour for the services, but had agreed to pay a reasonable compensation, and on this basis rendered judgment for the sum of $1.00 per hour, or a total sum of $246.00, plus attorney’s fees, in favor of plaintiff against defendant, from which judgment Mercedes Dusting Service, Inc., has prosecuted this appeal.

Appellant’s first point of error is as follows :

“The Honorable Trial Judge below erred when he held as a matter of law that Appellant was estopped from invoking a defective performance of the contract as a defense because it is the settled law of this State that, for a party to avail himself of the defense of estoppel, such estoppel must be specifically pleaded, such pleading being totally absent in the record of this cause.”

The trial was before the court without the intervention of a jury, and the court made the following findings of fact:

“1. Defendant, Mercedes Dusting Service, Inc., through its authorized agent, Royce Norman, engaged Plaintiff’s services and Plaintiff rendered his services at Defendant’s instance and for Defendant’s benefit.
“2. There was never a mutual understanding between the parties as to the amount of rate of compensation for the proposed services of Plaintiff; but Defendant’s agents and representatives did promise to pay Plaintiff reasonable compensation and Plaintiff rendered his services with expectation of being paid.
“3. No condition as to type of performance was exacted upon Plaintiff’s work.
“4. Plaintiff, Kenton Evans, did not purport to possess skill in the work he undertook to perform for Defendant.
“5. Plaintiff rendered his services in good faith, performing to the best of his ability.
“6. The end product of Plaintiff’s services, to-wit: a reconstructed Stear-man Wing, was unloaded and taken into custody by Defendant when delivered at its place of business.
“7. Defendant, through its agents and representatives, had the opportunity to intermittently observe and to have corrected any defects in the work of Plaintiff.
“8. Defendant did not apprize Plaintiff of any deviation of irregularity in his performance due in the progress of the job.
“9. Plaintiff rendered services to Defendant for a total sum of two hundred forty-six (246) hours.
“10. Considering Plaintiff’s experience and ability in the particular type of work involved, and in light of the unusually large number of hours in the performance of the job, the Court finds One ($1.00) Dollar per hour to be the reasonable value of Plaintiff’s services.
“11. Plaintiff caused Defendant to be notified more than thirty days prior to institution of suit, demanding payment by reason of his services, and to which Defendant refused.
“12. Plaintiff agreed to compensate for attorney bringing suit a contingent fee of 25% per cent, the same being the usual customary and reasonable fee for attorney’s services in this case.”

These findings of fact are not attacked by appellant as being unsupported by the evidence. Appellant does attack the conclusions of law made by the trial court, but this was a trial before the court, and as the findings are sufficient to support the judgment, it will be upheld even though the trial judge erred in some of his conclusions of law. Rules 206, 300, 301 and 307, Texas Rules of Civil Procedure; Redburn v. Shield, Tex.Civ.App., 338 S.W.2d 323; Wilson v. Brooks, Tex.Civ.App., 329 S.W.2d 135; Campbell v. Swinney, Tex.Civ.App., 328 S.W.2d 330; Turner v. Day, Tex.Civ.App., 322 S.W.2d 300; Orr v. Orr, Tex.Civ.App., 226 S.W.2d 172; Walton v. Woolworth, Tex.Civ.App., 222 S.W.2d 347; Keeton v. Gillam Soap Works, Tex.Civ.App., 215 S.W.2d 675; John Hancock Mutual Life Ins. Co. v. Stanley, Tex.Civ.App., 215 S.W.2d 416.

Rules 300 and 301, Texas Rules of Civil Procedure, require among other things that the judgment must conform to the findings of fact, but we are not aware of any rule that requires the judgment to conform to the conclusions of law. If the trial court renders an otherwise correct judgment, it will not be set aside because it made one or more incorrect conclusions of law. An Appellate Court is bound by the findings of fact made by the trial court, unless they are found to be unsupported by sufficient evidence, or unless they are so against the overwhelming weight and preponderance of the evidence as to be clearly wrong, but an appellate court is not bound by an incorrect conclusion of law made by the trial judge based upon his findings of fact. The appellate court will simply correct the incorrect conclusion of law, and if the judgment is found to be correct it will be upheld, although based upon an incorrect conclusion of law. The mere fact that the trial court may have erred in concluding as a matter of law that appellant was es-topped from invoking a defective performance, such incorrect conclusion of law is no reason for reversing the judgment supported by the facts found by the trial court.

We do not consider that this is a recovery on a “quantum meruit” basis, but simply a recovery based upon reasonable value of appellee’s services as was contracted to be paid by the appellant. The court found that the agreement was to pay the reasonable value of the time consumed in making the repairs upon the Stearman Wing, rather than the rate of $4.00 per hour.

The evidence shows that appellant went into this contract with its eyes open, as appellee informed it that he was not a wing repair man, that he held himself out only .as an expert furniture repair man. He did not agree to undertake the task until after he had fully advised appellant of the lack •of skill, insofar as “Stearman Wings” were concerned, and after he had been urged several times by appellant to undertake the job.

Appellant undertook to set up the defense of “defective performance”, which does not apply under the findings of fact made by the trial court. It is well settled that where “a person holds himself out as specially qualified to perform work of a particular character, there is an implied warranty that the work which he undertakes shall be of proper workmanship and reasonable fitness for its intended use, * * *.” 17 C.J.S. Contracts § 329, page 781; Hill v. Polar Pantries, 219 S.C. 263, 64 S.E.2d 885, 25 A.L.R.2d 1080. But here the opposite is true, appellee not only did not hold himself out as a skilled repair man for “Stearman Wings”, but informed appellant that he was not so skilled. The trial court properly held that the doctrine of defective performance did not apply, and must have used the word estopped in a general sense rather than as a technical legal term.

The judgment is affirmed.


text:
    I. M. FUTCH et al. v. D. C. GREER et al.
    No. 7095.
    Court of Civil Appeals of Texas. Amarillo.
    Feb. 5, 1962.
    Rehearing Denied Feb. 26, 1962.

      Clayton, Martin & Harris, Amarillo, for appellants.
    Will Wilson, Atty. Gen., H. Grady Chandler, Morgan Nesbitt and John B. Webster, Assts. Atty. Gen., Gibson, Ochsner, Harlan, Kinney & Morris, Amarillo, for appellees.
   DENTON, Chief Justice.

This is a suit brought by a group of citizens of the City of Amarillo as a class action, seeking an injunction against D. C. Greer, the State Highway engineer, and the members of the State Highway Commission and the City of Amarillo, its mayor, the city commission and city manager, to restrain the named defendants from designating, laying out, opening and constructing Interstate Highway Number 40 through the City of Amarillo. All parties filed motions for summary judgment. The City of Amarillo and its officials also filed a motion to dismiss on the ground the city and its officials were neither necessary nor proper parties to this suit. This latter motion was granted. The trial court entered a judgment granting the motion for summary judgment of Greer and the highway commission, denied the motion of appellants, and dismissed the City of Amarillo and its officials from the suit.

Appellants have brought forward no point of error which complains of the trial court’s action in dismissing the City of Amarillo and its impleaded officials. They have thereby waived any error the trial court may have committed in ordering the dismissal of these parties. Therefore that question is not before this court for determination. Porter v. Bell (Tex.Civ.App.), 287 S.W.2d 333 (writ refused n. r. e); Francis v. Kane (Tex.Civ.App.), 246 S.W.2d 279 (no writ history).

Appellants’ first point of error complains of the trial court granting appellees’ motion for summary judgment after having stricken certain affidavits filed on the day of the hearing, and which were attached to appellees’ reply to appellants’ motion for summary judgment. This point is based on the premise that there are no affidavits to support appellees’ motion for summary judgment. This latter motion had been filed and service obtained on June 10, 1960. Four affidavits were attached and filed with appellees’ motion for summary judgment some six months prior to the hearing. These latter affidavits, not being subject to appellants’ objection that they were filed on the date of the hearing, are therefore a part of the record and were properly before the trial court and this court. We understand appellants’ position to be that when the affidavits attached to appellees’ reply to appellants’ motion for summary judgment were not allowed to be introduced into evidence there remained nothing to support appellees’ motion for summary judgment. We are unable to agree with this contention. Appellees’ motion was supported by affidavits of the district highway engineer and an Amarillo city official in addition to certified copies of minutes and a resolution of the City of Amarillo approving and endorsing the route and plan of construction of the proposed highway. We therefore conclude this point is without merit.

Appellants next contend their motion for summary judgment was not controverted and that therefore the trial court erred in denying their motion. We recognize the general rule that where pleadings, sworn statements and admissions show a party to be entitled to a summary judgment and the opposing party does not oppose these instruments, the trial court is justified in accepting the moving party’s affidavits and motion as true and in entering a summary judgment. Sandone v. Dallas Osteopathic Hospital (Tex.Civ.App.), 331 S.W.2d 476 (refused n. r. e.) and cases cited therein. However, we are of the opinion this general rule has no application in the instant case. We do not construe Rule 166-A, Texas Rules of Civil Procedure as requiring that a motion for summary judgment can be controverted only by affidavits specifically replying to such motion. In our opinion appellees’ own motion for summary judgment supported by affidavits and exhibits attached thereto, together with the deposition of appellee D. C. Greer, constituted sufficient opposition to appellants’ motion. See Ragsdale v. McLaughlin (Tex.Civ.App.), 285 S.W.2d 467 (error dismissed). Summary judgments are not granted by default but only on the movant’s discharge of his burden to show the absence of fact issues. Freeberg v. Securities Investment Co. of St. Louis (Tex.Civ.App.), 331 S.W.2d 825 (writ refused).

Appellants’ next four points of error complain of the trial court’s failure to grant their motion for summary judgment on the ground that four specific requirements had not been met by appellees in locating and planning the highway in question. It is appellants’ position that it is undisputed that appellees conducted no public hearing prior to laying out and constructing the interstate highway; that no schematic design had been presented at a public hearing ; that no economic survey had been conducted; and that the Federal laws had not been complied with in selecting the route, design, etc., of the proposed highway. Because of the similarity of these matters they will be discussed together.

The supporting affidavit of the district engineer, Charles W. Smith, clearly states that a public hearing was held in the Amarillo Municipal Auditorium on Friday, August 2, 1957, relative to the location of the route of the proposed highway. Details of this meeting were set out in the affidavit. Mr. Smith’s affidavit further points out a second public hearing was held at the same location on October 29, 1958 where a schematic layout of the proposed highway was presented for public inspection. In our opinion the affidavits of appellants which are of record in this case do not effectively contradict the above referred to affidavit of Mr. Smith, and do not raise a fact issue as to these hearings. The public hearings so held were in full compliance with Article 6674w-l, Sec. 1, Vernon’s Ann.Tex.Civ.St. Title 23 U.S.C.A. § 128 provides:

“§ 128. Public hearings
“(a) Any State highway department which submits plans for a Federal-aid highway project involving the bypassing of, or going through, any city, town, or village, either incorporated or unincorporated, shall certify to the Secretary that it has had public hearings, or has afforded the opportunity for such hearings, and has considered the economic effects of such a location ”

Mr. Smith’s affidavit stated in part as follows:

“Everyone present was afforded the opportunity to speak with reference to the route for Interstate Highway 40. A record was made of the various speakers, their comments, criticisms, and suggestions, and a transcript of this record was forwarded on August 30, 1957 to the Bureau of Public Roads along with a certification by D. C. Greer, the State Highway Engineer, that due consideration had been given the economic effects of the proposed location of the highway. The central route of such highway through the city of Amarillo was thereupon approved by the United States Bureau of Public Roads and the Texas Highway Commission.”

In our opinion the record is clear that ap-pellees have fully complied with the requirements of the applicable State and Federal statutes and appellants’ summary judgment evidence does not raise a material fact issue.

Appellants further contend that Federal rather than State statutes govern in determining the location, laying out and constructing this interstate highway; that in as much as the Federal statutes had not been complied with in these respects the trial court erred in granting appellees’ motion for summary judgment. We think appellants are in error in their contention that the Federal statutes were not complied with. We find nothing in this record to support appellants’ assertion. According to Mr. Greer’s deposition, Federal funds had not been received by the State at the time his deposition was taken in May of 1960. By complying with Federal regulations the State would be reimbursed by the Federal government for certain sums previously expended by the State. The two hearings referred to above were held for a two-fold purpose: to comply with Article 6674-w-l, V.T.C.S. and Title 23, Sec. 128, U.S.C.A. The Federal regulations must be complied with in order to receive Federal funds. Such requirements do not limit or effect the authority of the State Highway Commission to select locations, construct and maintain highways in this State. State Highway Commission v. Humphreys (Tex.Civ.App.), 58 S.W.2d 144 (writ refused); Heathman v. Singletary (Tex.Comm.App.), 12 S.W.2d 150. See also Linnecke v. Dept. of Highways, 76 Nev. 26, 348 P.2d 235; Piekarski v. Smith (Del.), 153 A.2d 587. Appellants’ sixth point of error is overruled.

Appellants’ last four points of error complain that the trial court’s judgment violated the due process clauses of both the Federal and State constitutions. As we understand appellants’ contention, they are urging that appellees proceeded to acquire property for the right-of-way without relying upon the power of eminent domain, but by the threat of the use of eminent domain appellees are inducing property owners along the proposed route to sell such property. Appellants have cited no case, and we have found none, which prohibits a governmental agency or private business, vested with powers of eminent domain, from acquiring private property without resorting to condemnation proceedings. That appel-lees are authorized to acquire property by purchase and condemnation (emphasis added) can not be questioned. Art. 6674w-3. We know of no requirement that condemnation proceedings be instituted if a mutual sale of such property can be consummated between the property owner and the condemning authority. This record contains no evidence of any threat being used by any of the appellees or their agents in acquiring property in question.

We are not unaware of the hardships and inconveniences that have and will be incurred by many property owners within and near the proposed interstate highway. However, it is not the prerogative of this court to approve or disapprove of the layout or location of this highway. This is the duty of the appropriate authorities who must act according to the prescribed procedure under the law. After reviewing this record, consisting of numerous affidavits and exhibits, we are convinced the appel-lees have scrupulously observed and followed the applicable Federal and State laws in proceeding with the designation, laying out, and constructing the interstate highway under consideration. We are of the opinion, and so hold, that appellees’ pleadings, affidavits and exhibits support the trial court’s conclusion that no genuine material fact issue was raised, and that the record supports a summary judgment for the appel-lees.

By counterpoint appellees bring forward their plea in abatement in which it is pleaded that this is a suit against the State, and no legislative consent was given. The trial court’s judgment does not expressly pass on this plea. However, in view of our disposition of this case we do not deem it necessary to discuss this counterpoint.

After carefully reviewing this record we are of the opinion it reflects no reversible error. The judgment of the trial court is affirmed.


author: WILSON, Justice.

text:
    Louise Taylor BOUDREAUX et al., Appellants, v. Ella Yokum TAYLOR and Geneva Lawless Smith, Appellees.
    No. 3920.
    Court of Civil Appeals of Texas. Waco.
    Jan. 11, 1962.

      Sample & Walker, Beaumont, for appellant.
    W. G. Walley, Jr., Everett Lord, Beaumont, for appellee.
   WILSON, Justice.

Four sisters were declared illegitimate by the judgment appealed from, in which a take-nothing judgment was rendered against appellants. In our opinion the judgment is erroneous, and it is reversed.

Appellants are three of the daughters and the son of a deceased daughter of James Taylor and Cecilia Joseph whose Louisiana marriage the trial court concluded was void. Appellants were denied any interest in their father’s estate in this non-jury action against appellee, his fourth and surviving wife. Findings and conclusions were filed. The material facts, found or undisputed, are as follows:

April 17, 1896 James Melton Taylor obtained a Louisiana license to marry Stella B. Johnson, and on the same day executed a marriage bond required by Louisiana law. The return of the minister and the marriage certificate, however, show the marriage ceremony took place the previous day, April 16. We find no evidence to support the court’s finding that they were married April 10, 1896. November 6, 1896 Stella bore a child (who disclaims herein), and in 1897 James and Stella separated. The asserted impediment of this marriage is the basis on which the subsequent marriage of the parents of the four sisters was held void by the trial court.

In “the latter part of 1897”, according to Stella B. Johnson’s testimony, James Taylor and Cecilia Joseph drove to Stella’s home. “He stopped to speak to me and to introduce me to his future wife”, and Cecilia said, “I am the one that is going to marry your husband.”

March 21, 1898 a Louisiana license was issued authorizing the marriage of Taylor and Cecilia Joseph and a marriage bond was executed. The court finds a marriage ceremony was performed in Louisiana pursuant to this license. This public marriage ceremony was performed with attendants and bridesmaids in a church by a minister on the afternoon of March 23, 1898 in the same community in which the minister, bridesmaids, bride, groom and Stella Johnson resided. James and Cecilia immediately began living together and maintaining a home as husband and wife in that same community. From 1900 to 1909 seven daughters were born to them, three of whom died. The remaining four were declared by the judgment to be illegitimate. During all these years the record shows James, Cecilia and these children were continuously recognized as a family in the community. James and Cecilia continued to live in Louisiana, recognizing each other as husband and wife, rearing their family, recognizing and acknowledging their children as such, for about thirteen years. They separated in 1911, when James came to Texas. The court found James commenced residence in Texas in 1909 or some time thereafter.

The court found further that the 1896 marriage of James Taylor and Stella Johnson continued until dissolved by a divorce decree December 18, 1909. The only evidence in the record of a decree of this date is a certified copy of a Louisiana judgment, with blank docket number, dissolving bonds of matrimony in a cause styled “- Taylor vs. Ellila Taylor.” There is nothing to identify James Taylor and Stella Johnson with this document, although Stella testified she was divorced from Taylor in 1909.

In 1925 James obtained a Texas divorce from Cecilia, alleging in the petition they were lawfully married in 1898. Cecilia continued to live in Louisiana until she died in 1930. James married defendant-appellee in Texas in 1931 and they resided in Texas until he died intestate in 1952.

The trial court concluded the status of the children of Cecilia, born while she cohabited with James Taylor, was governed by Louisiana law, and that rights of inheritance were governed by the law of Texas. No complaint is made of these conclusions. The general rules are variously summarized as being that legitimacy of the child is determined initially by the law of the place of birth, or where the parents (or one or the other of them) were domiciled. Madden, Persons and Personal Relations (1931) p. 347; Goodrich, Conflict of Laws (1937) 435; Story, Conflict of Laws, Sec. 87; Stumberg, Conflict of Laws (1951) p. 332; IV Vernier, American Family Laws (1936) Sec. 241, p. 150 et seq.; Beale, Conflict of Laws (1935) Vol. II, p. 704; Leflar, Conflict of Laws (1959) 344; Minor, Conflict of Laws, 215; American Law Inst. Restatement, Conflict of Laws, Sec. 137; 12 Tex.Jur.2d Sec. 5, p. 306; 15 C.J.S. Conflict of Laws § 14, p. 915; 11 Am.Jur. p. 316. We are not concerned, however, with a question of conflict of laws, since our disposition would be the same under either Louisiana or Texas law, the controlling principles being substantially the same in both.

In Texas the presumption of validity of a marriage duly shown to have been contracted “is one of the strongest, if, indeed, not the strongest, known to law. The presumption is, in itself, evidence, and may even outweigh positive evidence to the contrary. The strength of the presumption increases with the lapse of time, acknowledgments by the parties to the marriage, and birth of children; and the fact that the legitimacy of a child may be involved is a factor in sustaining the validity of the marriage”. Texas Employers’ Ins. Ass’n v. Elder, 155 Tex. 27, 282 S.W.2d 371, 373. In the Elder case it was held a stipulation that one spouse never obtained a divorce did not show the marriage was not dissolved in a suit by the other; and facts negativing annulment did not destroy a presumption of divorce. It was held that upon proof of subsequent marriage “the presumption itself supplied the evidence” that a prior marriage had been dissolved and the subsequent marriage was valid; the burden of proving the contrary being upon the party attacking its legality, and no burden resting on plaintiff to show the prior marriage was dissolved. The Supreme Court said, “Courts will gladly resort to any allowable presumption to avoid the holding that Ethel Mae and Elder were never married and that the mother of Dade’s children is not his wife.” A common-law marriage was there in question; here it is a formal public ceremonial marriage. There a living wife’s rights were at issue; here the children’s interests are involved, where both parents are deceased.

In Louisiana also “The presumption of marriage and legitimate filiation is one of the strongest known to the law, and in favor of a child asserting its legitimacy this presumption applies with peculiar force”, as its Supreme Court has frequently held. Cameron v. Rowland, 1945, 208 La. 663, 23 So.2d 283, 292 and cases cited. In Patterson v. Gaines, 6 How. 550, 47 U.S. 550, 12 L.Ed. 553, the Supreme Court, in a case where it was asserted the impediment of a prior marriage invalidated a subsequent marriage so as to make children of the latter illegitimate, summarized Louisiana law: “If the fact of marriage be proved, nothing can impugn the legitimacy of the issue, short of the proof of facts showing it to be impossible that the husband could be the father.”

When these presumptions are applied it is apparent the evidence in the present case will not support a determination the daughters of James and Cecilia were illegitimate.

There is another impelling reason these children are to be held legitimate. Art. 117, Civil Code, West’s Louisiana Statutes Ann., in effect since 1825, provides that a null marriage “produces nevertheless its civil effects as it relates to the parties and their children, if it has been contracted in good faith”. Art. 118, Civil Code, provides, “If only one of the parties acted in good faith, the marriage produces its civil effects” in favor “of the children born of the marriage”. The innocent party to even a bigamous marriage is in good faith “so long as he or she has no certain knowledge of any impediment thereto”, and “if there is any doubt as to the good faith of the parties, it is to be resolved in favor of good faith.” Funderburk v. Funderburk, 1949, 214 La. 717, 38 So.2d 502, 504 and cases cited; Texas Co. v. Stewart, 1958, La.App., 101 So.2d 222, 227; Succession of Pigg, 1956, 228 La. 799, 84 So.2d 196, 197; Prince v. Hopson, 230 La. 575, 89 So.2d 128.

The civil effects attributed by these statutes to the children of a putative marriage include legitimacy and right of inheritance. Miller v. Wiggins, 1922, 149 La. 720, 90 So. 109, 112; Prince v. Hopson, 1956, 230 La. 575, 89 So.2d 128, 131. This was true under the Roman civil law, the law of France and Spain and the Code Napoleon. It has been the law of Louisiana since 1804. Gaines v. Hennen, 24 How. 553, 65 U.S. 553, 16 L.Ed. 770. An absolutely null marriage so contracted produces these civil effects. Succession of Fields, 1953, 222 La. 310, 62 So.2d 495, 499; Smith v. Smith, 43 La.Ann. 1140, 10 So. 248.

Art. 2581, Vernon’s Ann.Civ.Stat. (Prob. Code, Sec. 42) provides, “The issue also of marriages deemed null in law shall nevertheless be legitimate.” See Defferari v. Terry, 128 Tex. 521, 99 S.W.2d 290; Lewis v. Ames, 44 Tex. 319, 341, 342-344; Hartwell v. Jackson, 7 Tex. 576, 580; Cameron v. Cameron, Tex.Civ.App., 103 S.W.2d 464, 466, writ refused; and Consolidated Underwriters v. Kelly, Tex.Com.App., 15 S.W.2d 229; 8 Tex.Jur.2d pps. 520-521.

The trial court found as a fact that at the time of the marriage ceremony of James Taylor and Cecilia Joseph, both “had knowledge of the existence of the lawful marriage between the said James Taylor and Stella B. Johnson Taylor”, at such time. We have examined the record carefully. There is no evidence supporting this finding. The only circumstance which we have found, or to which appellee points to support such inference, is the testimony of Stella Johnson quoted above that “in the latter part of 1897” Cecilia was introduced to her by James, and said, “I am the one that is going to marry your husband.” Aside from the rule in both Louisiana and Texas that declarations of parents will not be received to bastardize or make children illegitimate, if this be construed as any evidence that Cecilia knew the marriage of Taylor and Stella had not been dissolved “in the latter part of 1897”, it was not evidence of such knowledge the following year when she and Taylor were married.

Though common-law marriage is not recognized in Louisiana, the presumption of innocence to support a putative marriage producing civil effects is so strong as to require clear and positive evidence to overcome it, and it was not destroyed in this case. We will not summarize the evidence admitted under hearsay rule exception that Stella and James were divorced prior to the marriage with Cecilia. It is presumed Cecilia contracted the marriage in good faith and the four daughters were legitimate issue of James and Cecilia. Succession of Chavis, 1947, 211 La. 313, 29 So.2d 860, 863; Succession of Braud, 1930, 170 La. 411, 127 So. 885, 887; Succession of Verrett, 1954, 224 La. 461, 70 So.2d 89, 91; Succession of Fields, 1953, 222 La. 310, 62 So.2d 495, 498; Succession of Primus, La.App., 1961, 131 So.2d 319. There is no evidence to destroy the presumption.

Appellees’ position is that the children could not have been legitimated under Louisiana law because under Arts. 199-213 Civil Code, Tit. 7, Ch. 3, natural parents may only accomplish legitimation by their subsequent marriage, or by notarial act; and by Arts. 200 and 204 only those children whose parents could have contracted marriage at the time of conception can be legitimated. The contention is untenable. Tit. 7, Ch. 3 deals with legitimation by acts of the parents: either subsequent marriage coupled with acknowledgment, or notarial act under Art. 203, in the event of subsequent legal marriage.

Arts. 117 and 118, Tit. 4, Ch. 4, however, concern status not dependent on parental acts. These provisions deal, not with subsequent marriage, but the legal consequences established by legislation which flow from a putative marriage, founded on good faith of one or both parties. Succession of Marinoni, 1936, 183 La. 776, 164 So. 797; 31 Tulane L.Rev. 551; 22 Tulane L.Rev. 340; 18 Tulane L.Rev. 290, 297; 6 Tulane L.Rev. 306. The distinction lies in the difference between legitimation on the one hand, and legitimacy on the other. The former requires parental act; the latter is a status acquired at birth. The provisions are distinct.

So is it in Texas. Art. 2581 (Probate Code Sec. 42) provides subsequent marriage (with recognition, prior to 1955) legitimates children previously born; but it further makes legitimate the issue of “marriages deemed null in law.” Under the latter provision, legitimacy “results from legislative declaration, and not from the subsequent acts of the parents after the child is born.” The two provisions are supplemental and distinct. “It is manifest that the Legislature by the language of the first provision, makes available to the parents the means of legitimating a meretricious relationship, and by the language of the second declares legitimate the issue of a relationship designated as a ‘marriage deemed null in law” ”. Defferari v. Terry, 128 Tex. 521, 99 S.W.2d 290, 291. In the latter case it was determined that good faith to create a putative marriage was absent, and there was only an illicit relationship shown; but that where a putative marriage was contracted in good faith, despite an impediment which made the marriage null in law, the issue would be legitimate under the last provision.

We hold the four daughters of James Taylor and Cecilia were legitimate. The judgment is reversed and the cause remanded for further proceedings not inconsistent herewith.


author: MASSEY, Chief Justice.

text:
    Raymond McDONALD, Appellant, v. R. M. WATKINS, Appellee.
    No. 16281.
    Court of Civil Appeals of Texas. Fort Worth.
    Jan. 19, 1962.

      Orr & Orr, and Joe F. Orr, Fort Worth, for appellant.
    Spurlock, Schattman & Jacobs, and Kenneth M. Cole, Jr., Fort Worth, for appellee.
   MASSEY, Chief Justice.

Suit was by R. M. Watkins as plaintiff against Raymond McDonald on sworn account. Additionally, suit was for damages for breach of the same contract under which the course of dealing gave rise to the action on account. Judgment was for the plaintiff and defendant appealed.

Judgment reformed and affirmed in so far as it was based upon the action in account. Judgment reversed and rendered in so far as it awarded damages for breach of contract.

Watkins was a farmer who occasionally raised chickens. McDonald was in the business of purchasing eggs, hatching them, and selling baby chicks. There was a certain breed of chickens which would grow into desirable birds for meat purposes. The parties contracted whereby McDonald sold some two thousand baby chicks to Watkins, at the same time agreeing to take all the eggs produced from them for an eight month period, said period was to date from the time the chicks matured and began laying eggs of satisfactory size and character. McDonald further agreed to pay Watkins the price of 60‡ per dozen for said eggs, a departure from the usual contract McDonald made with producers. He ordinarily “pegged” the price to be paid at the time of delivery of hatching eggs upon the current market price of baby chicks. There was nothing provided by the terms of the parties’ contract which prescribed the time for McDonald’s paying Watkins the agreed price of 60‡ per dozen.

It developed during the trial that McDonald considered it proper to pay Watkins on the basis of the current market price of eggs delivered (not to exceed 60¾⅜ per dozen) at the time Watkins made each delivery, with accounting to be made at the end of the eight month contractual period. Watkins considered that McDonald should pay upon delivery for eggs accepted at the agreed 600 price. In any event McDonald only paid the current market price as of the time of each delivery, and Watkins began keeping account of the number of eggs delivered, the amount paid per dozen therefor, and the arrears between the amount so paid and the calculable figure at 600 per dozen. The price paid upon delivery, undoubtedly based upon the current market, never amounted to as much as 600 per dozen.

Shortly before date of September 12, 1959, Watkins had a conversation with McDonald in which he told McDonald that he was in financial straits. He wanted McDonald to pay him the balance owing on the egg transaction under the 600 per dozen computation. McDonald advised him that he could not then pay him because the price of chicks was down. Evidently Watkins could not obtain a commitment as to when the balance owing would be paid. He told McDonald that he could not continue deliveries with payments as were being made by McDonald because he felt he was losing money. McDonald told him to “do whatever you want to with the chickens”, and to “sell them or do whatever you want to”. Accordingly, and having a prospective purchaser, Watkins sold his flock on or about date of September 12, 1959. No eggs were delivered by Watkins to McDonald after the flock was sold. Both Watkins and McDonald knew that there would be no more deliveries under the contract after sale of the flock.

Watkins continued in his insistence that McDonald pay him the balance owing according to a price of 600 per dozen for the eggs delivered. He brought suit and obtained judgment awarding such to him, plus attorney’s fees. Judgment also assessed damages against McDonald for breach of contract.

By certain points presented on appeal McDonald attacks the propriety of the judgment in respect to the indebtedness and the attorney’s fees. He attacks the propriety of attorney's fees allowed to Watkins by the judgment in this case upon the theory that the liability of McDonald to Watkins, if any, was based upon special contract and not upon a “sworn account” within the meaning and intent of Vernon’s Annotated Civil Statutes, Art. 2226, “Attorney’s fees”. Watkins had plead his case as provided by Texas Rules of Civil Procedure 185, “Suit on Sworn Account”.

In support of his contention McDonald cites language from the leading case of Meaders v. Biskamp, 1958, 159 Tex. 79, 316 S.W.2d 75. That case does not define the term “account”, within the contemplation of Art. 2226, but cites the case of McCamant v. Batsell, 1883, 59 Tex. 363, in which may be found language which does do so and which distinguishes an “account” from a “special contract”. It is necessary to examine the entire opinion beginning with the premise that there must be some kind of contractual relation between the parties, else there would be no sale, purchase, or transfer of title to personal property and creation thereby of the debtor-creditor relationship of the parties. The 1883 court says that an open account results when some one or more elements of the contractual agreement between the parties remains open, that is, remains to be ascertained, whereas in a special contract situation all the terms of the contractual agreement are fixed and certain. We have concluded that the circumstances of the instant case establish its character as a suit on open account for indebtedness thereunder accrued to date of September 12, 1959.

The material element of the contract by reason of which the transaction was one of “account” was the absence of any specification of the time McDonald was obliged to make payment for the eggs delivered. It is true, of course, that on the aforesaid date Watkins was privileged to make demand for the full payment of the balance owing for the delivery of the eggs, but McDonald was not obliged by any specific agreement on his part to' make payment at such time. The want of any requirement of the contract that he do so, coupled with the antecedent course of dealing by the parties under the preliminary agreement by which an account was opened, en-grafted the character of “open account” upon the entire transaction. When Watkins swore under oath and under the provisions of T. R. C. P. 185 that his account was true and just, the open account became a verified open account, or, to use the terminology of the Rule and Art. 2226, a “sworn account”.

The only attack upon the propriety of the allowance of attorney’s fees was based upon the want of qualification under the statute as an account. The attack must fail because it was an “account” upon which the suit was based.

In the evidence, wherein the matters relative to the contract and transaction between the parties were fully developed, McDonald agreed that his obligation was properly calculable at the figure of $1,-712.00, if and in the event he was not to be relieved of liability therefor because of Watkins’ failure to deliver eggs to him for the full contractual period of eight months rather than for the term, less than that number of months, up until Watkins sold his flock of chickens and ceased to deliver the eggs produced by such flock. Essentially it is McDonald’s contention that he actually paid the going market price for the eggs delivered to him by Watkins, making payment in said amount at the time each delivery was made by Watkins, and deferring any additional payment (to make iip the full contract price of 60‡ per dozen) until the end of the eight month period. McDonald says that he would have been bound to have delivered compensation to Watkins, as of the end of such eight month period, sufficient to make his payment to Watkins total that amount which would be calculable by multiplying the number of dozens of eggs by 60‡. However, McDonald claims that since Watkins failed to deliver the eggs for the full period of eight months, choosing instead to sell his flock of chickens and thereby rendering himself unable to make further deliveries, he breached his obligations under the contract. Because thereof, says McDonald, Watkins was not entitled to more than the going market price at time of each delivery, already paid him, and amounting to quantum meruit already received.

McDonald specifically denied ever having consented to Watkins’ sale of his flock and resultant inability to make further egg deliveries. By way of answer to a special issue submitted, however, the jury found that McDonald did approve the sale of the flock. Evidence standing undisputed in the record shows that McDonald cooperated with Watkins in making the delivery of his flock to the purchaser thereof, lending.him coops whereby they might be transported. In view of such evidence and the aforesaid jury finding there is shown a mutual abandonment of further performance under the contract, which would leave rights of parties already accrued under contract to be determined by its terms. Collinsville Mfg. Co. v. Street, 1917 (Tex.Civ.App., Amarillo), 196 S.W. 284; 13 Tex.Jur.2d, p. 617 “Contracts”, § 343 “• — Discharge of prior liability where rescission is mutual”.

Though the case was tried upon the theory of account, Watkins sought to recover damages as for breach of contract under the theory that McDonald was guilty of a breach in failing to pay the price of 60^ per dozen upon delivery. On jury findings as to damages sustained between September 12, 1959, and the end of the eight month contract period, judgment was entered in Watkins’ favor for $720.00, plus exemplary damages of $1.00. McDonald, founds a point of error upon the award of damages for breach of contract.

This point of error must be sustained. In view of what has been said relative to the establishment of a mutual rescission of the portion of the contract remaining after September 12, 1959, and concerning the jury finding and evidence relative thereto, it is obvious that McDonald was bound thereby. As McDonald is bound by the principle of mutual rescission, Watkins is likewise bound. Therefore, and in view of the mutual agreement and actions of the parties thereunder, Watkins may not be allowed to impose additional liability upon McDonald under the theory of breach of contract. In so far as the judgment awarded Watkins the sum of $720.00 for breach of contract it must be reversed. The award of $1.00 as exemplary damages, which must find its predicate therefor in the award of damages for breach, must likewise be reversed, although Watkins’ counsel conceded on oral argument that said award should be deleted for other reasons. The total amount by which the principal judgment must be reduced, therefore, is in the sum of $721.00.

Interest on the total amount awarded by the judgment was provided to accrue from date of its entry. Such date was February 20, 1961. By a cross-assignment of error Watkins complains’ because of this and seeks an award of interest as applied to the amount recovered by his suit on .sworn account, $1,712.00, from date of January 1, 1960. It is provided by V. A. T. S., Art. 5070, “Legal rate applicable {in the award of interest)”, that when there is no specified rate of interest agreed upon by the parties, interest at the rate of six per cent per annum shall be allowed on all open accounts from the first day of January after the same are made. Therefore, the contention of the cross-point is well taken and the judgment should be reformed so as to provide that interest on ■said $1,712.00 should date from January 1, 1960.

Judgment on Watkins’ action on sworn account is reformed so as to award interest on the sum of $1,712.00 from date of January 1, 1960, with interest on the amount awarded as attorney’s fees from date judgment was entered. Judgment awarding Watkins the amount of $721.00 as actual and exemplary damages for breach of contract is reversed and rendered.

Costs of appeal are assessed as one-third against appellee Watkins- and two-thirds as against appellant McDonald.


author: McNEILL, Justice. McNEILL, Justice.

text:
    W. T. BURTON COMPANY, Inc., Appellant, v. KEOWN CONTRACTING COMPANY and Keown Supply Company, Appellees.
    No. 6507.
    Court of Civil Appeals of Texas. Beaumont.
    Nov. 30, 1961.
    Rehearing Denied Jan. 11, 1962.

      Baker, Lamson & Plessala, Port Arthur, for appellant.
    C. M. Bradford, Hustmyre & Harris, Orange, for appellees.
   McNEILL, Justice.

This is an action by appellant W. T. Burton Company, Inc., against appellees, Keown Contracting Company and Keown Supply Company, to recover upon an endorsement placed by appellees upon three certain due bills or non-negotiable notes executed by Texas Portland Cement Company, payable to Keown Contracting Company. Before trial the parties, under Rule 263, Texas Rules of Civil Procedure, made an agreed statement of facts and filed it with the clerk. The statement provided 'that there was no issue of fact to be submitted to a jury, and the only issue was the legal one of whether appellees, as assignors of the due bills, were liable to appellant as assignee. Motion was made by appellant for judgment upon the agreed case; but the trial court overruled appellant’s motion, and over its objection heard oral testimony to the effect that when the endorsement and assignment of the notes were made it was agreed between the parties that appellant would not hold appellees liable for nonpayment of the notes or due bills. This issue was submitted to the jury and the jury found that such an agreement existed. Thereupon appellant filed its motion for judgment non obstante veredicto, which was overruled, and the court rendered judgment for appellees.

Appellant urges five points here, all of ■which are to the effect that since the parties stipulated as to the facts, entered into an agreement thereon as provided in Rule 263, T.R.C.P., and expressly stated there was no issue of facts to he submitted to a jury, the court erred in considering any evidence or testimony outside of the said agreed facts and erred in submitting such question to the jury, and in failing to render judgment for appellant. Appellees contend in answer to this that the trial court correctly heard evidence and submitted the issue since there was an irreconcilable conflict in the agreed case between the legal effect of endorsement of the instruments involved and the written assignment of the instruments which accompanied the transfer of the notes to appellant.

It has been held in numerous cases that the court is not warranted in disregarding the agreed statement of facts made by the parties under Rule 263, supra, but must decide the case thereon. Wyss et al. v. Bookman (Com.App.), 235 S.W. 567; Cousins v. Cousins, Tex.Civ.App., 42 S.W.2d 1043; Aetna Life Ins. Co. v. Smith, Tex.Civ.App., 293 S.W. 243; 3 Tex.Jur.2d 4. Of course, if there is a irreconcilable conflict between material facts in an agreed case so that one such fact would dictate a judgment for plaintiff while the other would dictate a judgment for defendant, and the conflict could not be resolved otherwise, the trial court probably could not render judgment without some testimony or evidence that would change the situation. However, no written evidence was offered at the hearing on the issue submitted in the present case but only the parol testimony of two witnesses. While this testimony has been held inadmissible, Evans v. Swartz, Tex.Civ.App., 264 S.W. 234, as being in conflict with the endorsement, objection to this testimony was not made on this ground but upon the ground that it was at variance with the agreed stipulations. We think the objection made was good. But appellees insist there is an irreconcilable conflict between the duties created in the two writings.

Was there such conflict between the liability imposed by the endorsement on the back of the notes and the liability created by the written assignment as to justify evidence being heard? In order to properly present the question, we copy the endorsement on the notes:

“Pay to the order of W. T. BURTON COMPANY, INC.
KEOWN SUPPLY COMPANY
By: Alvin V. Keown
President
KEOWN CONTRACTING COMPANY
By: Alvin V. Keown
President”

The assignment reads:

“STATE OF LOUISIANA

PARISH OF CALCASIEU:

“NOW, THEREFORE, KNOW ALL MEN BY THESE PRESENTS, THAT:

“KEOWN CONTRACTING COMPANY, in consideration of the sum of ONE DOLLAR cash in hand paid and other valuable considerations, does hereby collaterally ASSIGN, TRANSFER AND SET OVER, unto W. T. Burton Company, Inc., all of Assignor’s right, title and interest in and to those certain Due Bills, to-wit:

Due Bill #18 — dated August 1, 1956 $14,803.20
Due Bill #19 — dated September 1, 1956 9,600.00
Due Bill #22 — dated October 3, 1956 1,080.00

in the total amount of TWENTY-FIVE THOUSAND FOUR HUNDRED EIGHTY-THREE and 20/100 ($25,483.20) DOLLARS issued by the TEXAS PORTLAND CEMENT COMPANY of Orange, Texas to KEOWN CONTRACTING COMPANY of Orange, Texas.

“The undersigned warrants that there has been no prior or superior protected assignment of said Due Bills or any part thereof; and that he has the right to receive the full amount thereof; in accordance with the terms thereof.

“The undersigned agrees to mark all ledger sheets or other records to show that said account receivable has been assigned to W. T. BURTON COMPANY, INC., by this instrument; and the undersigned further agree that ASSIGNEE may notify in writing the obligor of said due bills of the assignment and have payment made directly to said Assignee.

“Executed this 3rd day of October, A.D. 1956.

“KEOWN CONTRACTING COMPANY

By: Alvin V. Keown

Alvin V. Keown, President

KEOWN SUPPLY COMPANY

By: Alvin V. KEOWN

Alvin V. Keown, President”

Art. 571, R.C.S.1925, provides that the assignee of a non-negotiable instrument shall be entitled to recover from any previous assignor thereof, but in order to hold the assignor or endorser as surety for the payment of the instrument Art. 570 provides that the assignee shall use due diligence to collect the same from the maker. By their endorsement of the due bills sued upon appellees became liable as sureties for the payment thereof. The question of due diligence is not involved, as after the issuance of these due hills by it the Texas Portland Cement Company was placed in reorganization proceedings by the U. S. District Court for the Eastern District of Texas in 1958. After these notes were transferred to appellant, all creditors were enjoined by that court from bringing suit against Texas Portland Cement Company upon any debt held. However, claim on these notes or due bills has been properly filed with the Receivers in the Federal Court as provided by law.

Whether the transferor of a nonnegotiable instrument endorsed the note itself is immaterial upon the question of liability for payment thereof for the reason that Art. 571 provides that the assignor of such instrument is liable. See 9 Tex.Jur.2d 94—96. We take this to mean that any person making a written assignment of such instrument becomes liable as surety for payment thereof unless he qualifies his liability by the phrase “without recourse” or words, of similar import. Appellees argue that they, in effect, did qualify their liability as reflected in the written assignment; that the only warranty made in the assignment was that there had been no prior or superior protected assignment of said due bills and that the assignor had the right to receive the full amount thereof, and they conclude from this that this is in direct conflict with the effect of their endorsement. We think it follows from the statutes mentioned that ordinarily either the assignor or one who endorses a non-negotiable note in effect says “if the holder cannot, by using due diligence, obtain payment from the maker I will pay.” See, also, 79 A.L.R. 721; 10 C.J.S. Bills and Notes § 30, page 440. The warranty in the assignment that no prior or superior assignment had been made does not conflict with the duty to pay the note if the maker does not. And the warranty that the full amount is due thereon in no way conflicts with the obligation to-pay if the maker does not. In view of the fact that the notes were non-negotiable the two obligations of the assignors as stated in the assignment were added to protect against any claimed offset of the maker or other claimants of the notes.

Appellees advance the further argument that since the assignment does not, in words, transfer the notes, but only “assignors’ right, title and interest” therein, this instrument was in the nature only of a quitclaim to the obligations and not a delivery of the full title thereto and that by virtue of this qualification appellees should not be held for nonpayment of the due bills. We have found no case involving a non-negotiable note using such language (unless the Behrens-Kirkgard case, infra, is one), but have found several interesting cases involving negotiable instruments with the same or similar language used. There are two lines of holding, one that such language modifies the endorsement, the other that such language does not modify the endorsement. The Mississippi case of Divelbiss v. Burns et al., 161 Miss. 724, 138 So. 346, sets forth the two groups of holdings. The Supreme Court of Mississippi in this case says:

“The decisions are in direct conflict upon the point. The following cases sustain the contention that such an in-dorsement is a special or qualified in-dorsement, is a simple assignment without recourse: (citing cases). The argument of those cases is that, since an indorsement in blank, by the signature alone, is all that is necessary to express a general indorsement, then why use so many additional words if a general in-dorsement was intended, that something more than the intention to incumber the paper with useless language must be ascribed to the parties; and that, since in using the additional words only the terms of a simple assignment are expressed, the contract must be construed as limited to those words. These cases apply, therefore, the maxim, ‘Expressio unius est exclusio alterius.’ ”

The court states (138 So. p. 347): “The following cases maintain the opposite view”, citing a number of cases, including Behrens v. Kirkgard, Tex.Civ.App., 143 S.W. 698. After these citations it is there said:

“The argument of those cases is that the signature of a payee indorsed on a note operates, in law, to connect the said party therewith in three relations: (1) As a warrantor of genuineness and of right and title; (2) as an assignor; and (3) as an obligor for the payment of the note if the payer fails to pay. When, therefore, the indorser uses additional words expressive simply of assignment, which the law already attaches to his signature without the words so used, the words are in effect surplusage; and there is applied the maxim, ‘Expressio eorum quae tacite insunt nihil operator’ — the expression of what is implied without the expression is inoperative, or, as sometimes stated, the expression of that which the law implies works nothing. Since the indorser, in expressing the fact in additional words that he assigns or had assigned the note, expresses in that respect what the law in that same respect ascribes to his signature, and since such words do not in terms negative the other implication imported into the transaction by force of the law, the cases last cited hold that the implications of law other than the assignment are not thereby excluded. The weight of authority, as well as the majority of the text-writers, take the view sustained by the line of cases last cited.”

The case of Fay v. Witte, 262 N.Y. 215, 186 N.E. 678, indicates the same divergence between the different courts and adheres to the majority rule. Behrens v. Kirkgard, supra, follows the majority rule and we are persuaded to do so in this case. The endorsement and assignment should be construed together. Stubblefield v. Cooper, Tex.Civ.App., 37 S.W.2d 818; 10 C.J.S. Bills and Notes §§ 44, 184, pages 482, 679; 9 Tex.Jur.2d 63. So doing, we can find no conflict between the guaranty as surety on the note and the additional warranties made in the assignment.

We have treated the appellee Keown Supply Company as being in the same category as the Keown Contracting Company, as the agreed statement makes no distinction between the position of the two and while the assignment is not clear, the supply company must have had some interest in the due bills for otherwise there would not appear to be any explanation of its joinder therein. It should be said also that while the assignment uses the word “collaterally” in the transferring clause, this was evidently surplusage.

Since we conclude appellees are liable as sureties on the obligations sued upon, the judgment of the lower court is reversed. It will he the order of this court that appellant recover of appellees the sum of $25,-278.99 (the total of said notes less $204.21 paid on principal), together with interest at the rate of 5% per annum (as provided in notes) from August 1, 1956 on the note for $14,803.20, and interest at the rate of 5% per annum from September 1, 1956, on the note for $9,600.00, and interest at the rate of 5% per annum from October 3, 1956, on the note for $1,080.00, which totals to date $6,588.70, less the sum of $1,437.03 payments heretofore made on such interest, leaving the net amount of past due interest in the sum of $5,151.67, which added to the balance owing on the principal, totals $30,-430.66 for which amount judgment will he rendered with interest on such sum from date of judgment at the rate of 6% per an-num' (as provided in Art. 5072, Vernon’s Ann.Civ.St.) until paid, and all costs of suit.

Reversed and rendered.

STEPHENSON, J., did not participate in deliberations upon, nor the decision in this case.

ON MOTION FOR REHEARING

McNEILL, Justice.

It is made to appear in appellees’■ motion for rehearing that after this cause was disposed of in the trial court, in the reorganization proceedings in the II. S. District Court mentioned in the original opinion, application was made by the trustees to reduce the principal amount of the due bills involved by 20 per cent. It is claimed that notice of this application was given to appellant but none to appellees, and the latter did not participate in such hearing; and that as a result of the hearing the U. S. District Court reduced the amount of the bills by said 20 per cent and appellees now assert that they are entitled to a reduction of liability in a similar amount. Appellees also argue since the Federal Court in its proceeding has disallowed interest on the obligations from the date the matter was placed in reorganization proceedings, that interest likewise should not be allowed in any judgment rendered against them. Appellant’s answer to this motion does not deny that a reduction was made by the Federal Court, but replies that since the matter took place after the trial below and it not being a part of the present record, no notice can be taken of it.

Appellant’s position is correct. It has been often held that matters presented for the first time in a motion for rehearing cannot be considered. 3 Tex.Jur.2d pp. 651, 652. As stated in the original opinion, this record is here on an agreed case and in the absence of mutuál mistake or fraud it is binding. 3 Tex.Jur.2d pp. 4 and 5.

No mention was made in the original opinion of the right to ownership by appel-lees of the due bills, in the event they discharged the judgment, as it was thought that such right necessarily followed. 10 C.J.S. Bills and Notes § 449, page 986. However, the motion prays that such right of subro-gation be provided for. It is therefore ordered that in the event appellees shall discharge the judgment in favor of appellant, they shall be subrogated to all rights of appellant in said due bills.

Motion for rehearing is overruled.

STEPHENSON, J., not sitting.