author: HICKMAN, Commissioner.

text:
    BENNETT v. McKRELL.
    No. 2334—7569.
    Commission of Appeals of Texas, Section A.
    Nov. 13, 1940.
    J. A. Wood, of Corpus Christi, and Butler & Grimes, of Robstown, for plaintiff in error.
    Perkins & Floyd and Frank T. Morrill, all of Alice, for defendant in error.
   HICKMAN, Commissioner.

The questions presented for decision in this case are of such nature that a short statement will be sufficient to disclose how they arose. A much fuller statement of the case is made in the opinion of the Court of Civil Appeals, which is reported in 125 S.W.2d 701.

Defendant in error, Clifton McKrell, .sued plaintiff in error, Frank Bennett, individually and as sole devisee of his deceased wife, for specific performance of an oral contract which the jury found was made by McKrell with Bennett and his wife during her lifetime, by the terms of which the Bennetts agreed to devise certain real estate to him, and further agreed that if he would work on their dairy farm without any specified salary or wage during their lifetime, the three of them would accumulate jointly additional property with the income of the dairy farm, that they would increase their herd of cattle, and all property so acquired would be held in Bennett’s name, but would be owned by the three jointly. McKrell began to work for the Bennetts in 1921 and the suit was instituted in 1937, it being his theory that the contract was repudiated by Bennett during that year. He was denied any recovery on his alleged cause of action based upon the contract to devise because same was prohibited by the statute of frauds, Art. 3995, R.C.S. Upon his cauSe of action based upon the trust agreement, that is to' say, the agreement relating to after-acquired property, he was awarded a one-third interest in a number of small tracts of land, aggregating eighty acres, and certain live stock, all acquired after such contract was entered into and held in Bennett’s name. No contention . is presented that this latter contract is prohibited by statute. The Court of Civil Appeals affirmed the trial court’s judgment and Bennett filed an application for writ of error.

Four assignments of error are brought forward in the application. One assignment presents the contention that the judgment has no support in the verdict, because there was no finding by the jury that any specific property was acquired pursuant to the trust agreement. That assignment is based upon this showing in the record: Special Issue No. 1 submitted to the jury the question of whether or not the alleged oral contract to devise by will was entered into by the parties. Special Issue No. 2 submitted the question of whether McKrell performed any services provided for in said contract. Special Issue No. 3 submitted the question of whether or not the alleged contract to acquire property in the future was entered' into by the parties. Special Issue No. 4 referred to the next preceding issue and then submitted the question of whether or not the parties thereafter acquired real and personal property pursuant to that contract. All the foregoing issues were answered in the affirmative. Then followed Special Issue No. 5, which was in this language: “If you have answered Special Issue No. 4 ‘Yes’, then please find and answer from a preponderance of the evidence the particular real and personal property acquired by said parties, if any, pursuant to said agreement, if any, found by you in answer to Special Issue No. 1.”

It will be observed, that by that issue the jury was not called upon to find what property was acquired pursuant to the trust agreement, but was called upon to find what property was acquired pursuant to the contract to devise. There is no finding that the property described in the judgment was acquired pursuant to the trust agreement, and the sufficiency of the verdict to support the judgment is challenged on that account. It was the view of the Court of Civil Appeals that there was an obvious clerical error in Special Issue No. 5 in referring to Special Issue No. 1 instead of Special Issue No. 3. We do not find it necessary to consider that matter. The question presented by the assignment may be 'disposed of upon a ground concerning which we think there can be no question. An inspection of the record reveals that there was no issue of fact to be determined by the jury as to what property was acquired pursuant to the trust agreement. The deeds to all of the real estate in which an interest was recovered by McKrell are in the record and all were executed subsequent to the making of the trust agreement. The livestock was also acquired after that time. The jury having found that the trust agreement was made, there was no further disputed fact issue to be determined. The record contains no evidence that the property was purchased with funds derived from any source other than from the dairy farm. No duty rests upon a court to submit an issue to a jury as to which there is no dispute in the evidence. The assignment is overruled.

By another assignment complaint is made of the holding of the Court of Civil Appeals that the trial court did not err in refusing to submit issues upon the statutes of limitation. The assignment is very broad and refers both to the five-year and ten-year statutes. Considering it in connection with the statement made in explanation and support thereof, it would appear that the question presented is that an issue of fact was raised on the question of whether Bennett had acquired title to this trust property under the five-year and the ten-year statutes of limitation. We have given the question careful consideration, but can find no evidence sufficient to present such an issue. We need not write at length upon the question, because there is nothing- which need be written, except that we are referred to no evidence, neither have we discovered any, which would raise either issue. It seems that the theory is that plaintiff in error was entitled to an affirmative submission of the question of whether McKrell was a hired hand and not a joint adventurer. That question would not be submitted in an issue on limitation. The assignment is overruled.

Another assignment complains of the refusal of the trial court to instruct the jury peremptorily to return a verdict that defendant in error take nothing by his suit. The assignment is based upon the contention that the testimony of Mc-Krell offered to establish' a parol trust was uncertain and confusing, and was therefore insufficient to establish such trust in real property. There is some uncertainty about certain phases of the agreement claimed to have been made, but there is positive testimony concerning the terms of this particular phase of the contract. McKrell testified positively that such contract was made. That being true, it cannot be held, as a matter of law, that a peremptory instruction should have been given. The assignment is overruled.

One other assignment is brought forward. It complains that the judgment awarded an excessive recovery. It appears that in the deeds whereby Bennett acquired some of these small tracts of land, reservations of one-half of the minerals* were made by the vendors. The theory upon which recovery was had was' that McKrell was entitled to a one-third interest in whatever was acquired after the contract was entered into. The judgment awards him a one-third interest in those several lots without taking into account the fact that there had been reservations of minerals. Obviously that was an error. Defendant in error freely admits the error, and agrees that the judgment may be reformed here. That portion of the judgment awarding a recovery of an undivided one-third interest in the real estate will therefore be so reformed as to limit the recovery to one-third of the land conveyed in the several deeds to Bennett. An inspection of the record discloses that reservations were contained in deeds conveying Lots Nos. 56, 57, 72, 73, 87, 88, 89 and 90, Sec. 76, and the judgment will be so reformed as to limit the recovery to one-third of said lots, subject to a prior reservation of one-half the minerals.

Generally, such reformation would result in the taxing of all appellate costs against defendant in error, but that result will not follow here, because plaintiff in error did not call the trial court’s attention to that error. Had plaintiff in error pointed out same in the trial court, doubtless it would have been corrected there and an appeal to correct same would not have been necessary. The costs of appeal will, therefore, be adjudged against plaintiff in error, notwithstanding the reformation of the judgment here. 11 Tex.Jur. p. 370, Sec. 80, and authorities there cited.

It is ordered that the judgments sf the Gourt of Civil Appeals and the trial court both be reformed in the particular above set forth and that, as reformed, they be affirmed.

Opinion adopted by the Supreme Court.


source: Caselaw Access Project

author: TAYLOR, Commissioner.

license: Public Domain

text:
    GRIGSBY et al. v. FIRST NAT. BANK IN QUANAH et al.
    No. 1842—7558.
    Commission of Appeals of Texas, Section B.
    Nov. 6, 1940.
    Rehearing Denied and Opinion Corrected Jan. 8, 1941.
    See 146 S.W.2d 174.

      Charles Nordyke, of Stephenville, and McWhorter & Howard and Charles L. Cobb, all of Lubbock, for plaintiffs in error.
    E. L. Klett, of Lubbock, for defendants in error.
   TAYLOR, Commissioner.

Johnnie Dell Grigsby and W. E. Grigs-by, Jr., minors, brought this suit by next friend against the First National Bank in Quanah, Ruby G. Borders, their mother, .and other defendants not parties here, for the recovery of $7,500. Judgment was for the defendants upon trial without a jury, which was affirmed by the Court of Civil Appeals. 125 S.W.2d 368.

Writ of error was granted upon the .application of the minors acting through ■their next friend, W. R. Fickas.

The cause alleged on behalf of the minors was one for conversion by Mrs. Borders and the bank of funds received from a sale ■of the minors’ properties about November, 1929.

The Court of Civil Appeals holds that while the books and records of the bank made a prima facie case in favor of the minors, the evidence offered by the bank by way of explanation of the transactions involved was sufficient to warrant the trial •court in concluding that it did not receive .any of the funds belonging to the minors, and that it applied none of such funds to the payment of Mrs. Borders’ note to the bank; and that for this reason neither she nor the bank was guilty of conversion.

We were not in accord upon consideration of the application for the writ with the conclusion stated with respect to the bank’s explanation; and writ of error was granted upon the view that the Court -of Civil Appeals erred in holding the evidence legally sufficient to explain away the prima facie case made by plaintiffs and support the trial court’s judgment. Upon further consideration of the record we are •confirmed in that view.

At the time of the transactions involved E. B. Caskqy wns president of the bank .and J. D. Hughes was its vice president -and cashier. So far as the record shows they were the only persons connected with the bank who knew anything about its part in the transactions. At the time of the trial Caskey was deceased and Hughes was president of the bank.

The matters here involvéd grow out of the purchase by Mrs. Borders of a bakery in Lubbock. Her husband, John I. Grigs-by, had died in 1927 at Quanah and had left surviving him his wife, and the two children who are plaintiffs here. The father’s interest in the community estate descended to the children. That interest consisted in the improvements on lot 19, block 6, of the town of Quanah. The improvements were the Bon Ton Bakery located thereon, together with the furniture, fixtures, tools and equipment used in connection with its operation.

Mrs. Borders, who was guardian of the person and estate of the minors from November 18, 1929, until some time in 1936, obtained, prior to November 15, 1929, an option to purchase a bakery in Lubbock. It was her plan to finance the purchase through a sale of the Quanah bakery. According to the testimony of Hughes she came to the bank to get him and Caskey to help her consummate a sale of the Quanah bakery to B. E. Harper, who was to purchase it for $20,000, and they agreed “to help her close the deal” for “a 5% commission on the $20,000.00.” It appears that shortly prior to that time a contract of sale had been prepared by Judge C. Y. Welch (then a practicing attorney at Quanah), or,by an attorney acting in conjunction with him, which provided that the $20,000 consideration was to be “10,000.00 as her part and $10,000.00 as the children’s part for the children’s one-half interest”; that the children’s part was to be paid, $7,500 in cash and a note for $2,500, due in six months, and that $10,000 was to be paid Mrs. Borders in notes, payment to begin eighteen months later.

Mrs. Borders, according to Judge Welch’s testimony, reported to him that her option on the Lubbock bakery was about up and that if she knew Hughes and Caskey would let Harper have the money she could go ahead with the deal for the Lubbock bakery, which she was anxious to make. Thereupon Judge Welch, after telling her “she would have to take out guardianship papers in order to complete the sale,” sounded out the county judge to ascertain if he would approve the sale to Harper on the terms stated above. Judge Welch upon being- advised the county judge would approve such a sale made this known at the bank. He testified that after talking to the county judge he went back to the bank and that “they said then over there * * they would put'up the money.” He further testified that “$7,500.00 in money was for the children’s part of the property.” It appears from Judge Welch’s testimony that he did not know the details of how the matter was finally handled. He did testify that he knew of no source “from which that $7,500.00 would have come except from money put up in the bank”; also that “there was never any order in the probate court of Hardeman county (the county of which Quanah is the county seat) authorizing any part of the $7,500.00 to be invested or expended by the bank.” The order of appointment of Mrs. Borders as guardian was made November 18, 1929, and the order approving the report of sale was made November 25, 1929.

The following excerpt from the statement of facts shows the material recitals of the $7,500 note, together with pertinent penciled notations made thereon by the bank: “First National Bank, Quanah, Texas. $7500.00. November 15th, 1929. On demand after date we, I, or either of us, promise to pay to the order of the First National Bank in Quanah * * ■ * Seventy-five Hundred and no/100 Dollars, * * * with interest at the rate of ten percent per annum from date until paid and 10 percent attorneys’ fees * * *. Full authority is hereby given to the legal holder hereof to sell any collateral security assigned or attached, at public or private sale, without notice, upon non-payment. (Signed) Ruby G. Borders, No. 30346. Due: D. (Penciled notation: Paid: 11/29/29.) (Penciled note on back of note: $6500.00, 14 days 25.27.)”

The following testimony of Hughes is taken from the record without observing the order in which it appears, the omission notations showing the terminations . respectively of the excerpts:

“Q. And that (a ledger sheet of the bank showing Mrs. Borders’ account) shows the date the money was put up ? A. November 15th, yes sir. (That was three days before application for guardianship was filed).
“Q. How much money was credited to that account on that date? A. $6500.-00.
“Q. And (the- note) you took in return, that was for the $7500.00? A. Yes sir. * * *
“Q. Was that money, namely the $6500.00, to be held in escrow until the completion, of the sale to Harper? A. Yes sir.
“Q. Was that money paid to her as the proceeds of the sale of the children’s half-interest in the Bon Ton Bakery? A. ■ I suppose so. * * *
“Q. This is a deal between you and the guardian, and the guardian, or you for her, placed $6500.00 in escrow? A. It was placed to this account here. * * *
“Q. Then you did not place it in escrow? A. Not other than this account here.
“Q. That was placed in here on November 15th, 1929 and at the same time you did that you required Mrs. Borders or she did make an individual note? A. Yes sir.
“Q. And you claim now that this note belonged to you and Caskey? A. I said that we were responsible for the note and she understood that the children were to pay it. * * *
“Q. I believe that you say that you and Mr. Caskey were to get five per cent commission of the $20,000.00 deal or a commission of $1,000.00? A. Yes sir.
“Q. Did you gentlemen get that money? A. Yes sir.
“Q. Did you get it out of that $7,500.00? A. Yes sir.
“Q. So you were getting $1,000.00 as commission on the transaction? A. Yes sir.
“Q. You were taking it out of the cash payment of $7,500.00? A. Yes sir. * *
“Q. You and Mr. Caskey did not own the note? A. We did not own it, no sir.
“Q. But you were going to see that it was paid? A. Yes sir.
“Q. You overlooked assigning the note to the bank? A. We did not intend to sign it over'to the bank.
“Q. And you didn’t endorse the note? You were not under the impression that the bank would require you to pay the note you did not sign, were you? A. I don’t know about being under that sort of impression. I stated that Mrs. Borders knew that she did not have to pay the note.
“Q. You stated under direct examina-tion that you and Mr. Caskey as individuals did all of this? A. Yes sir.
“Q. But now you say that the note belonged to the hank? As a matter of fact considered as part of the assets of the bank, wasn’t it? A. Yes, sir, it was. * * *
“Q. Sir. Hughes, the bank collected off of this note, off of Ruby Borders on this note that she executed to the bank the sum of $25.27 as interest for 14 days? A. Yes.
“Q. In other words the note was not paid out of the children’s fund until 14 days later? A. I don’t know just how that is there. As to the interest, Mrs. Borders was willing to pay the interest to get the money available. •
“Q. But it was paid and' paid to the bank? A. Yes sir.”

The following is the material part of a .letter written by Hughes to Mrs. Borders on behalf of the bank on November 29, 1929, concerning the note: “Mrs. Ruby G. Borders, Lubbock, Texas. Dear Mrs. Borders: We are enclosing herewith your note for $7500.00 marked ‘Paid.’ The Harper deal was closed today which paid this note in full and we have charged your account with $25.27 covering the interest for fourteen days on $6500.00. * * *. Yours very truly, (Signed) J. D. Hughes, Vice-Pres.”

The basis of the holding of the Court of Civil Appeals is the following excerpt from its opinion [125 S.W.2d 371]: “On November 15, 1929, before the probate court had authorized the sale of the property belonging to the minors, Mrs. Ruby G. Borders drew a draft on the First National Bank of Quanah, Texas, .for the sum of $11,000, payable to the Citizens National Bank of Lubbock. After the order of the court had been obtained authorizing the sale and Messrs. Caskey and Hughes had advanced the cash payment required for the sale to be completed and subsequent to the consummation thereof, the bank of Quanah paid, on November 19th, to the bank of Lubbock on the draft the sum of $11,000. Mrs. Borders was the qualified guardian of the person and estate of the minor plaintiffs and the bank was authorized to pay the money on her draft. Quanah, A. & P. R. Co. v. Wichita State Bank & Trust Co., 127 Tex. 407, 93 S.W.2d 701, 106 A.L.R. 821. The record indicates that Mrs. Borders exercised her.option to purchase the Dandy Bakery in Lubbock and that the money evidenced by the draft for $11,000 was used to pay therefor. The testimony shows that the note for $7,500 given to the bank by Mrs. Borders was not intended as a loan and that since the sale of the Quanah property was consummated as per contract, no financial obligation was evidenced by the note and that the bank, through its officers, so understood and that none of the proceeds derived from the sale of the property belonging to the minors was applied either by the guardian or the bank to the payment and satisfaction of said note. * * * In our opinion, the testimony is amply sufficient to warrant the court in concluding that the appellee bank did not receive or apply any of 'the funds belonging to the minors to the payment of the individual note of Mrs. Borders and that neither she nor the bank was guilty of conversion.”

The $11,000 draft of Mrs. Borders above referred to was drawn on the Quanah bank on November 13, 1929, ten days before the order was made appointing her guardian of the estate of the children. The endorsements on the draft show that it was endorsed by the Lubbock bank on the date it was drawn, by the First National Bank of Fort Worth on November 16th, by the Federal Reserve Bank of Dallas on November 18th, and that it was paid by the Quanah bank on November 19th, the day after the application for appointment as guardian was filed.

The above excerpts from the record reveal the transactions from the bank’s standpoint, and show the construction the officers of the bank, especially Mr. Hughes, placed thereon at the time they occurred.

We are not in accord with the view of the Court of Civil Appeals stated in the conclusion of that part of the opinion quoted above. The testimony shows with reasonable certainty, looking through form to substance, that Mrs. Borders, the bank, and its officials, knew the true source of the $7,500 was the interest of the minors in the Quanah bakery; and that having such knowledge, they acted together in applying the proceeds of the sale of that interest to the payment of Mrs. Borders’ indebtedness to the bank and its officials, all of whom directly benefited thereby. For this reason the case is not controlled by the Quanah, A. & P. R. Co. case, supra, but rather by United States Fidelity & Guaranty Company v. Adoue & Lobit, 104 Tex. 379, 137 S.W. 648, 138 S.W. 383, 37 L.R.A.,N.S., 409, Ann.Cas.1914B, 667, and Wichita Royalty Company et al. v. City National Bank, 127 Tex. 158, 89 S.W.2d 394. The vital distinction between the Quanah case and the case last referred to, that of the profit derived by those taking- part in the transaction, is pointed out in the opinion in the Quanah case and need not be restated here. The same distinction obtains-between the Quanah case and the present case. Both the bank and the bank’s officials derived direct benefit through the Harper deal, regardless of whether it was a deal having reference to the sale of the property to Harper, or to what Hughes claims was an escrow transaction whereby $7,500 was placed in the bank by him and Caskey as a loan to Harper to be held in escrow for Mrs. Borders, who later checked it out.

Nor has the case of Anderson v. Walker, 93 Tex. 119, 53 S.W. 821, 825, any application to the present facts, other than as authority that the above evidence, some of which was not' in accord with the bank’s record, was admissible to show what the transaction was, and that the “purposes of the parties are to be deduced from the whole of such evidence.”

Hughes, when pressed upon cross-examination for an explanation of certain matters .shown by the bank’s records in their relation to the escrow theory, testified in part:

“Q. At the time that you gave her credit for the $6500.00, November 15th, the bank gave her credit for $6500.00 in her individual account, did it not? A. To be kept in escrow until the deal was closed.
“Q. And on that same date she executed a note for $7500.00, including-this $7500.00? A. Yes sir.
“Q. And that was some two or three days before the confirmation of the sale to Mr. Harper by the Court, and the sale had not been completed at that time? A. I would not attempt to answer that. I don’t remember those dates.
“Q. And if the record would show, and for your information it does show, that it was on November 25th, then you paid out that $11,000.00 on the individual check of Ruby Borders some six days before this sale was made? A. The Bennie Harper sale?
“Q. If this date, November 25th is correct. A. I would not attempt to answer.
“Q. The Harper deal, as you recall it, was closed on what date with reference to the time that the money was placed to Ruby Borders personal account? A. I don’t believe that I could answer that. I don’t believe that I could give you that date. It was closed before this $11,000.00 check was paid.
“Q. Then why did you charge her $25.00 for 14 days interest? A. I don’t know zvhy that delay came about.
“Q. There was a delay or you would not have overcharged her for 11 days? A. The delay was evidently because it was in the fall of the year, thru the busy season, and it was evidently neglected because of that condition. The banks get all of the interest that they can and maybe lose it all in one deal later on. I would not attempt an explanation of that.
“Q. You have your record showing where the money was paid in by Harper and to whose account it was credited, do you not? A. We paid the money, Mr. Caskey and I.
“Q. Does your record show when it was paid in the bank ? A. No sir.
“Q. Does the bank have a record of that? A. No sir. I would not say just what record we did have.
“Q. What account did you gentlemen pay those to? A. To take up this note.
“Q. To take up the note? A. Yes sir.
“Q.. That Ruby Borders had made? A. Yes sir.
“Q. And you paid it to the bank? A. Yes sir.” (Italics ours.)

The foregoing evidence does not explain away the prima facie case of the minors; and the evidence as a whole is not legally sufficient to show, as stated by the Court of Civil Appeals, that the bank “did not receive or apply any of the funds belonging to the minors” to the payment of Mrs. Borders’ note. On the other hand it shows to a practical certainty that they were so applied, thus placing both the bank and Mrs. Borders in the position of having converted the proceeds of the $7,500 note on November 29, 1929.

Whether Hughes and Caskey as agents of Mrs. Borders in rendering her the services for which they were paid $1,000, regarded the $7,500 as Harper’s money or Mrs. Borders’ money made available to her as above shown, is immaterial, at least so far as the bank’s liability, or that of Mrs. Borders’, is concerned.

The trial court’s judgment should have been in favor of plaintiff in error for that amount, with interest. The Court of Civil Appeals erred in affirming the judgment in favor of the defendants. The judgments below are reversed and set aside, and judgment is here rendered for plaintiffs in error against defendants in error for -$7,500, with interest at the rate of 6 per cent from November 29, 1929.

Opinion adopted by the Supreme Court.


author: GERMAN, Commissioner.

text:
    COWART v. RUSSELL et al.
    No. 2330—7553.
    Commission of Appeals of Texas, Section A.
    Nov. 13, 1940.
    Lyndsay D. Hawkins, of Breckenridge, and L. C. Counts, of Olney, for plaintiff in error.
    Conner & Conner, of Eastland, for defendants in error.
    L. K. Frickstad and Allen Wight, both of Dallas, amici curiae.
   GERMAN, Commissioner.

The parties will be designated in this opinion as in the trial court. The Court of Civil Appeals has made a very accurate statement of the material facts, which statement is as follows:

“Defendant Russell was clerk of the district court of Eastland county in 1919 and 1920. During his tenure of office the case of Cowart v. Rust was tried in said court. On the trial an agreement was reached whereby Rust paid into the district court the sum of $2,000 in settlement of said suit, $666.65 thereof being for the benefit of the plaintiff herein, who was then a minor. The judgment directed the clerk of said court (Russell) to pay $666.65 to Mrs. Callie Cowart, for plaintiff, when she qualified as plaintiff’s guardian. Mrs. Cowart never so .qualified. The evidence is to the effect that the funds to which plaintiff was entitled, were never paid to her, or any one else. The present suit was instituted by Cowart against Russell and the sureties on his official bond as district clerk; plaintiff alleging that Russell had embezzled and converted’ said sum of money so deposited with him as clerk. The purpose of the suit was to recover such sum, with interest, from said former clerk and his sureties, by reason of such defalcation.
“Plaintiff’s petition was filed January 17, 1936.. The funds were deposited with the clerk in the Cowart-Rust case in January, 1920. When the money was paid into court plaintiff was a minor. He attained his majority on the 13th day of May, 1932. Thus, it appears that this suit was instituted more than two years, but less than four years, after the time plaintiff became 21 years of age. Russell ceased to be district clerk in December, 1920. * * * Russell’s bond as district clerk was conditioned that he should ‘faithfully perform and discharge all the duties required of him by law as district clerk, aforesaid, and shall safely keep the records of his office * *
“The court instructed a verdict for defendants.”

The Court of Civil Appeals affirmed the judgment of the district court. 116 S.W.2d 888. Its judgment was based upon the holding that the cause of action was barred by the two years’ statute of limitation (Art. 5526, subd. 4, R.S.1925). In reaching this conclusion the Court of Civil Appeals followed the decision of the Supreme Court in Hatcher v. State, 125 Tex. 84, 81 S.W.2d 499, 502, 98 A.L.R. 1213.

In the Hatcher case it was held that an official bond is “a collateral security for performing the officer’s duty, and, when suit is barred for breach of his duty, action is also barred on the bond.” It was therefore held that action upon a bond such as was there involved was subject to the bar of the two years’ statute. That decision whs not only in accord with the great weight of decisions, but has been followed in subsequent cases.

In the case of Tarfant County v. Prichard et al., Tex.Civ.App., 89 S.W.2d 1028, a suit against a justice of the peace and the surety on his official bond was held to be barred in two years.

The case of Aetna Casualty & Surety Co. v. State, Tex.Civ.App., 86 S.W.2d 826, involved a suit against a district clerk and the surety on his official bond. The suit was on behalf of the State to recover a sum of money paid into the treasury of the court, as in the present suit. Upon authority of the Hatcher case, the action was held to be barred by the two years’ statute. Judgment in favor of the State was reversed and judgment rendered in favor of the surety. Application for writ of error was dismissed, but the holding upon the question of limitation was necessarily approved.

The soundness of the holding in the Hatcher case is apparent when the matter is viewed from a somewhat different angle. The four years’ statute of limitation (Art. 5527, subd. 1, R.S.1925) has relation to “actions for debt where the indebtedness is evidenced by or founded upon any contract in writing.” It is well settled that “in order for an action to be one for an indebtedness evidenced by or founded upon a contract in writing, as referred to in the above quoted statute, the action must be between the immediate parties to the contract, or those for whose benefit it was made, or their privies, and the written instrument relied upon must itself contain a contract to do the thing for the nonperformance of which the action is brought.” Shaw v. Bush, Tex.Civ.App., 61 S.W.2d 526, 528, writ refused. Also authorities there cited, especially McDonald v. Thompson, 184 U.S. 71, 22 S.Ct. 297, 46 L.Ed. 437. The obligation of the bond in this instance was that Russell should “faithfully perform and discharge all the duties required of him by law as district clerk, aforesaid, and shall safely keep the records of his office.” It is readily seen that this does not within itself create a contract to do more than perform his official duties. Obligations created by statute are subject to the bar of the two years’ statute of limitation. Shaw v. Bush, supra; Rose v. First State Bank, 122 Tex. 298, 59 S.W.2d 810.

Herein is found a distinction between the present case and the cases of Throckmorton County v. Thompson, 131 Tex. 543, 115 S.W.2d 1102, and McKinney v. Robinson, 84 Tex. 489, 19 S.W. 699. Those cases involved actions upon the official bond of a county treasurer. Under Article 1704 of the Revised Statutes of 1925 the bond required of a county treasurer is conditioned that “such treasurer shall faithfully execute the duties of his office and pay over according to law all moneys which shall come into his hands as county treasurer, and render a true account thereof to said court at each regular term of said court.” It is thus seen that such a bond not only contains an obligation to “faithfully execute the duties of his office,” but contains within itself a contract to do certain things, the nonperformance of which may become the basis of a cause of action. In such a case manifestly the four years’ statute of limitation would govern. Upon this basis it becomes easy to reconcile apparent conflicting decisions.

We are of the opinion that Article 2290 in no way changes the result. • Upon its face that article pertains to money or property deposited in court .“during - the progress of any cause to abide the result of any legal proceeding.” Besides, that article clearly recognizes a difference between the duties prescribed therein and the general official duties of the officer, the performance of which is secured by his official bond. It will be noted that under Article 1994 dealing with actions brought by next friend of a minor there is no affirmative duty placed on the district clerk with reference to money deposited in the treasury of the court. Therefore, no obligation concerning same could be read into the bond. The only statutory provision with reference to what shall be contained in the official bond of a district clerk is that prescribed by Article 1897, R.S.1925, to the effect that it shall be “conditioned for the faithful discharge of the duties of his office.” There is nothing in such a bond which within itself may constitute the basis of a cause of action other than one based upon the failure of the clerk to perform his official duties; and this is barred by the two years’ statute.

For the reasons herein stated the judgment of the Court of Civil Appeals affirming the judgment of the district court is affirmed.

Opinion adopted by the Supreme Court.


author: SLATTON, Commissioner.

text:
    MONTGOMERY et al. v. HOUSTON ELECTRIC CO.
    No. 1838—7547.
    Commission of Appeals of Texas, Section B.
    Nov. 6, 1940.
    Allen, Helm & Jacobs and William States Jacobs, Jr., all of Houston, for plaintiffs in error.
    Baker, Botts, Andrews & Wharton, Palmer Hutcheson, and J. C. Hutcheson, III, all of Houston, for defendant in error.
   SLATTON, Commissioner.

This suit was filed in the 80th District •Court of Harris County by M. M. Montgomery, Jr., and his mother against Houston Electric Company, to recover damages for personal injuries sustained by M. M. Montgomery, Jr., in a collision with said Montgomery and a passenger bus operated by the Electric Company in the City of Houston. A jury trial resulted in a verdict on which judgment was rendered in favor of Montgomery and against the Electric Company. The Electric Company appealed to the Court of Civil Appeals at Galveston and the judgment was reversed and the cause remanded for another trial. Houston Electric Co. v. Montgomery et al., 123 S.W.2d 943. Writ of error was granted by this court.

The Honorable Court of Civil Appeals entertained the opinion that findngs in the verdict of the jury were in conflict and mutually destructive.

The trial pleadings of the parties tendered the issues of primary negligence, discovered peril and contributory negligence. The findings.of the jury said to be in conflict by the Court of Civil Appeals are as follows:

“(IS) Do you find from a preponderance of the evidence that prior to the collision M. M. Montgomery, Jr., was in a perilous position ?
“(16) Do you find from a preponderance of the evidence that the bus driver discovered that M. M. Montgomery, Jr., was in a perilous position?
“(17) Do you find from a preponderance of the evidence that the bus driver discovered the-peril of M. M. Montgomery, Jr., within such time and distance as that by the exercise of ordinary care in the use of all the means at his command, consistent with the safety of himself, his passengers and his bus, he could have avoided the collision?
“(18) Do you find from a preponderance of the evidence that the failure of the bus driver to exercise all of such means was negligence as that term is herein defined?
“(19) Do you find from a preponderance of the evidence that such negligence was a proximate cause of the injuries, if any, sustained by M. M. Montgomery, Jr.?”
Each of these issues was answered “We do.”

Special Issue No. 22, “Do you find from a preponderance of the evidence that immediately prior to the collision in question the minor plaintiff, M. M. Montgomery, Jr., suddenly turned his bicycle to his right?

⅜ * * * *

Special Issue No. 31. “Do you find from a preponderance of the evidence that M. M. Montgomery, Jr., failed to give any warning of his intention to make such turn, before making the turn?”

Each of these issues was likewise answered “We do”.

As we understand, the holding of the Honorable Court of Civil Appeals is that Special Issues Nos. 15 to 19, inclusive, are antagonistic to Issues Nos. 22 and 31 in point of time, i. e., that there was time for the bus driver to have prevented the collision (which is included in the former group of issues) and that there was not such time (which is said to be included in Special Issues Nos. 22 and 31).

The finding of the jury that the boy, immediately prior to the collision, suddenly turned his bicycle to his right and the finding that the boy at such time failed to give any warning of his intention to make such turn do not conflict with the finding that the bus driver discovered the perilous position of the boy within such time that, by the use of ordinary care, etc., the collision could have been prevented.

In fact, the findings contained in Special Issues Nos. 22 and 31, without additional subsidiary findings, amount to no defense unless it can be said that the boy, in suddenly turning his bicycle to the right and his failure to give warning of his intention to make said turn, was guilty of contributory negligence as a matter of law, and then where, as in this case, the pleadings and the evidence raise the issue of discovered peril and the jury has found upon that issue in favor of the injured party, the issues of primary negligence and contributory negligence become immaterial. St. Louis, B. & M. Ry. Co. v. Cole et al., Tex.Com.App., 14 S.W.2d 1024; Dallas Railway & Terminal Co. v. Bankston, Tex.Comm.App., 51 S.W.2d 304.

The Court of Civil Appeals having properly determined that the issue of discovered peril was raised by the pleadings and proof, and the jury having found on that issue in favor of the injured party, the findings on the issue of contributory negligence will not preclude the entry of a judgment in favor of the injured party, which was done in this case by the trial court. Hence, the Court of Civil Appeals erred in reversing the judgment of the trial court. Defendant in error relies upon the holding of this court in the case of Texas Motor Coaches, Inc. v. Palmer et ux., 132 Tex. 77, 121 S.W.2d 323. In that case, as is pointed out in the opinion, it was held that a finding on the issue of primary negligence nullified an essential element contained in the findings on the issue of discovered peril. Therefore, the remaining findings on said issue were insufficient to support a verdict against the offending party under the doctrine of discovered peril.

In the present case, as we have seen, all essential elements of discovered peril have been found against defendant in error. It could make no difference as to the judgment to be rendered that all elements of contributory negligence alleged against the minor plaintiff were found against him, for the reason that contributory negligence is no defense to an action predicated upon the doctrine of discovered peril. Wilson v. Southern Traction Co., 111 Tex. 361, 235 S.W. 663. These conclusions render immaterial many of the contentions of defendant in error made in the Court of Civil Appeals that the minor plaintiff was guilty of contributory negligence as a matter of law. Moreover, we construe the opinion of the Court of Civil Appeals as having overruled the contentions made by defendant in error on the sufficiency of the evidence and findings of the jury on the issue of discovered peril being against the preponderance of the evidence. Such rulings are indicated in the following language contained in that court’s opinion [123 S.W.2d 944]:

“On this appeal it is accordingly determined that this judgment must stand or fall upon whether or not it properly followed from the pleadings, evidence, and findings upon the question of discovered peril; this Court condueles that it did not, but that, on the contrary, there was an irreconcilable conflict between the jury’s findings upon that issue alone, which requires a reversal.
“While the appellant makes earnest contention against the sufficiency of either the pleading or proof, or the evidence, to even raise that issue, having objected in the trial court, to each procedural step as well looking to the submission of it to the jury, it is concluded that none of these protests were well taken — that, on the contrary, the pleadings and proof of the appellees • not only properly raised that as a material issue for the jury, but, as indicated, that it became the exclusive one for its determination, on the coming in of all the evidence.”

The holdings of the Court of Civil Appeals which overrule the attack of defendant in error on the sufficiency of the pleadings and the legal sufficiency of evidence to raise the issue of discovered peril are approved by this court. We have no jurisdiction to review the ruling that the finding of the jury on the issue of discovered peril is against the great weight and preponderance of the evidence. We have examined all assignments of defendant in error made in the Court of Civil Appeals to ascertain whether the judgment of that court,, which reversed the judgment of the trial court, could be sustained upon any other theory. After a careful consideration of all of the assignments, we have concluded that none of them can be properly sustained. Such assignments, other than the ones discussed, do not present questions of sufficient importance to require further notice.

The judgment of the Court of Civil Appeals is reversed and the judgment of the trial court is affirmed.

Opinion adopted by the Supreme Court.


author: HARVEY, Commissioner.

text:
    CONTINENTAL SUPPLY CO. v. HOFFMAN.
    No. 2319—7526.
    Commission of Appeals of Texas, Section A.
    Nov. 6, 1940.

      Turner, Seaberry & Springer, -of East-land, and McGown, McGown, Godfrey & Logan and Harry L. Logan, Jr., ¿11 of Fort Worth, for plaintiff in error.
    Mayfield, Grisham & Grisham and J. A. Lantz, all of Tyler, for defendant in error.
   HARVEY, Commissioner.

This suit was instituted in the District Court of Eastland County. The plaintiff in the suit is the Continental Supply Company, a Delaware corporation. The defendants in the suit are C. H. Lockhart and P. L. Hoffman, both of whom reside in this State. The object of the suit is the recovery of judgment (1) against Lockhart for the purchase price of certain oil well casing sold to him by the Supply Company; (2) against both defendants for the foreclosure of a lien on the casing; (3) against Hoffman for conversion of the casing — he having purchased same from Lock-hart in Loving County, Texas. Judgment by default was recovered against Lockhart. As between the Supply Company and Hoffman, the case was tried before the trial judge, without a jury. The trial resulted in a judgment against Hoffman. The latter appealed, and the Court of Civil Ap-’ peals affirmed the trial court’s judgment in the respect that it was against Lockhart; but reversed same in the respect that it was against Hoffman, and remanded the cause. 120 S.W.2d 851. In the respect that its judgment reverses the trial court’s judgment and remands the cause, the action of the Court of Civil Appeals is based exclusively on the fact the record contains no evidence to show that the Supply Company had a permit to do business in Texas. The Supply Company has been granted the writ of error.

The Supply Company contends that notwithstanding the record contains no evidence to show that the Company had a permit to do business in this State, the Court of Civil Appeals erred in reversing the trial court’s judgment and remanding the cause, in the respects it did. This contention is grounded on the fact that the record contains uncontroverted evidence, which shows that the sale of the casing to Lockhart constituted an interstate transaction. The facts relevant to said contention are.substantially as follows:

The petition of the Supply Company, upon which the case was tried, contains appropriate allegations for the recovery of the purchase price of the oil well casing which was sold by the Supply Company to Lockhart. Nothing appears in the petition to characterize said sale as an interstate transaction. Except by inference deducible from the paragraph of the petition quoted below, the petition does not signify that the said sale to Lockhart was an intrastate transaction. Said paragraph reads as follows: “Plaintiff, the Continental Supply Company, is a corporation organized and existing under'and by virtue of the laws of the State of Delaware, with its principal office and place of business in Dallas, Dallas County, Texas, and doing business in Texas, under and by virtue of a lawful permit so to do.” The defendant Hoffman pleaded the general- denial. The record, as has been said, contains no evidence to show that the Supply Company had a permit to transact business in this State; but does contain uncontroverted evidence which shows that the sale of the casing to Lockhart constituted an interstate transaction. However, in discussing the case this uncontroverted evidence will not be considered in order to reach a conclusion, and for this reason will be discarded.

The ruling of the Court of Civil Appeals, upon which its judgment of reversal is based, is to the effect that because the Supply Company is a foreign corporation, it was necessay for the Company to show by evidence that it had a permit to transact business in this State. In the final analysis this ruling was induced by the allegation in the Company’s petition, in substance, that the Company had its principal office in this State and was doing business here. This calls to notice the provisions of Article 1529, Rev.St.1925, and article 1536 of the Revised Statutes, Vernon’s Ann.Civ. St. Art. 1536. So far as relevant said statutes read as follows :

Article 1529: “Any corporation > for * * * profit * * * organized or created under the laws of any other State * * * desiring to transact or solicit business in Texas, or to establish a general or special office in this State, shall file with the Secretary of State a duly certified copy of its articles of incorporation; and thereupon such official shall issue to such corporation a permit to transact business in this State * *

Article 1536: “No such corporation can maintain any suit * * * in any Court of this State upon any demand, whether arising out of contract or tort, unless at the time such contract was made, or tort committed, the corporation had filed its articles of incorporation under the provisions of this Chapter. * * *”

It is well settled by the decisions of this Court that the provisions of Article 1536 have reference exclusively to demands which arise out of intrastate transactions. They do not apply to demands which arise out of interstate transactions— that is to say, transactions which involve interstate commerce. Miller Co. v. Goodman, 91 Tex. 41, 40 S.W. 718, 11 Tex.Jur. p. 162. In a word, as regards interstate transactions, no permit to transact business is required.

This holds true regardless of the fact that, at the time the interstate transaction occurred, the corporation was maintaining an office and doing business in this State without a permit. Texas & P. Ry. Co. v. Davis, 93 Tex. 378, 54 S.W. 381, 55 S.W. 562; 11 Tex.Jur. p. 163. So in the present case, treating as true the allegation in the Supply Company’s petition, to the effect that the Company had its principal office here, and was doing business in this State, still the necessity for a compliance with the statute does not appear. The fact that the sale to Lockhart constituted an intrastate transaction is not affirmatively alleged in the plaintiffs petition; the defendant failed to tender issue in respect to the character of such sale and therefore he must be regarded as having waived the issue. Oklahoma Tool & Supply Co. v. Daniels, Tex.Com.App., 290 S.W. 727.

We find no error committed by the trial court in any respect. The judgment of the Court of Civil Appeals, in the respect it reverses the trial court’s judgment, is reversed, and the judgment of the trial court is in all respects affirmed.

Opinion adopted by the Supreme Court.


text:
    BAKER v. FELL.
    No. 2328—7548.
    Commission of Appeals of Texas, Section A.
    Nov. 6, 1940.

      Carrigan, Hoffman & Carrigan and James E. Prothro, all of Wichita Falls, for plaintiff in error.
    T. R. Boone and Kearby Peery, both of Wichita Falls, for defendant in error.
   HICKMAN, Commissioner.

This is an action by plaintiff in error, Mrs. Stella Baker, against defendant in error, A. H. Fell, in trespass to try title. In the trial court the jury returned a verdict in favor of Mrs. Baker upon a peremptory instruction, and judgment was entered thereon. The Court of Civil Appeals reversed the trial court’s judgment and remanded the cause. 123 S.W.2d 746.

The case rests upon the construction of a written contract which is set out in full in the opinion of the Court of Civil Appeals. The contract was in the form of a letter sign'ed by Mrs. Baker addressed to Fell. At the foot of the letter was this notation: “Accepted: (Signed) A. H. Fell, (Signed) Louis H. Gould.” We set out below such portions thereof as are deemed material here.

“Wichita Falls, Texas
“March 6, 1937
“Mr. A. H. Fell
“Wichita Falls, Texas.
“Dear Sir:
“For myself individually and as Executrix of the Estate of T. F. Baker, deceased, I agree to convey to you by general warranty deed, subject to the terms and conditions hereof and upon the consideration hereinafter stated, the land and premises described in Exhibit ‘A’, attached hereto and made a pai't hereof:
“As a consideration for the foregoing, you are to pay me for said land the sum of $6442.50, in the following manner:
“(a) Cash, $4831.88; said sum to be paid to me upon the final consummation of this deal, but within the time hereinafter stipulated.”

Then follow paragraphs (b) and (e) providing for the execution by Fell of a note for $1,310.62 and a note for $300, the latter being payable to Louis H. Gould, who, it would seem, was the broker in the transaction. Following paragraph (c) are these provisions :

1. “In connection with paragraph (a) above, it is understood that you are applying to some one or more of the Federal Lending Agencies for a loan of seventy-five per cent of the purchase price of the land described in Exhibit ‘A’; if said Federal Lending Agencies shall not within fifteen days from this date approve your application for a loan of seventy-five per cent of the purchase price of said land and commit itself to the making of said loan, then this entire contract shall be null and void and be of no binding force or effect upon either party hereto.”
2. “I agree to furnish you an abstract of title certified to this date by a competent and responsible abstractor, showing good and merchantable title in me to the land and premises described in Exhibit ‘A’; you are to have five days from and after the date of receipt of such abstract of title, within which to have the same examined by your attorney; if valid objections shall be raised thereto, a true copy thereof shall be furnished me at Wichita Falls within said five day period and I shalL have ten days within which to effect a cure thereof.”
3. “It is understood and agreed that title shall be accepted by you and this trade fully and finally consummated and the consideration aforesaid fully paid within sixty days from this date; and if said title shall not be accepted by you and the entire consideration as herein defined shall not be paid by you as hereinbefore provided within said sixty days, then this contract shall be null and void and neither party bound hereby.” (Numbering supplied).
Fell filed an application with the Federal Land Bank for a loan of seventy-five per cent, of the purchase price of the land. The bank and its commissioner accepted the loan, but for a lesser amount than three-fourths of the value. It is not claimed by Fell that he was successful in' procuring a loan from any federal agency in accordance with the contractual provision of paragraph 1 above copied. His claim of title is based upon this: On May 3, 1937, two or three days before the expiration of the sixty-day period named in paragraph 3, above copied, he addressed to Mrs. Baker a letter written by his attorney, which, omitting the introduction and conclusion, reads as follows:
“On March 6, 1937, you made a contract with A. H. Fell, to sell to him a certain tract of land out here Northwest of town, being 257.7 acres, and the contract provides that the title shall be accepted by Mr. Fell and the trade fully and finally consummated ' and consideration paid within sixty (6Q) days from date.
“Mr. Fell is now ready to fully consummate this deal, has accepted title and now demands a conveyance as provided in this instrument, and to. go through with the deal. He did on the 28th day of April, 1937, accept title and demanded conveyance thereof and was informed by Mr. Hoffman that he did not believe that you intended to go through with the deal, so he filed the contract of record on April 28, 1937, which is now recorded in Vol. 345, page 187 of the Deed Records of Wichita County, Texas, and. he here and now accepts the title, here and now offers the consideration as provided therein and to fully and completely perform and demands performance of you.
“This letter is written at the request of Mr. A. H. Fell, and the writter is having Mr. Fell to sign this letter, giving a copy thereof to Mr. Hoffman.”

Fell filed the contract fofl record on April 28, 1937, which cast a cloud upon Mrs. Baker’s title, and this suit followed.

Upon the trial Mrs. Baker proved common source, and the only question is whether she proved a title superior to that of Fell. His claim of title is based solely upon the contract. If he has no equitable title under it, he has no title at all.

Paragraph 1 of the contract, in plain and unambiguous language, provides that, in the event the contingency therein named, to wit, the approval by “Federal Landing Agencies” within fifteen days of Fell’s application for a loan of seventy-five per cent, of the purchase price of the land, be , not met, then the entire contract shall be null and void and of no binding force or effect upon either party. That contingency or condition was not met. The “Federal Lending Agencies” declined to accept the application for that amount. The certain conclusion follows that the contract expired fifteen days after its execution and was no longer binding on either party thereto. It is not a question of forfeiture, cancellation or rescission. The contract simply never became a binding obligation to convey. It expired in virtue of its own provisions. 10 Tex.Jur., Contracts, sec. 197, and authorities there cited; 12 Am.Jur., Contracts, sec. 296.

As we understand the opinion of the Court of Civil Appeals, that court based its decision upon the conclusion that the provisions of paragraphs 2 and 3 of the contract, above copied, control the rights of the parties, or, if not, serve to create an ambiguity, making parol testimony admissible as to their intentions. We can see no conflict or inconsistency whatever between the provisions of the named paragraphs. The contract clearly provided for two conditions precedent to the maturing of any obligation on the part of Mrs. Baker to convey. She obligated herself to convey in the event the named commitment was made by some agency of the federal government within fifteen days, provided title should be accepted and the consideration paid within sixty days. She did not bind herself unconditionally for sixty days. She bound herself for fifteen days and then in the event the said commitment should be made by some federal agency, and only in that event, for forty-five days longer. To have given rise to any right in himself to compel her to convey, Fell must have done these two things: First, procure the said commitment within fifteen days, and, second, tender the consideration within forty-five days thereafter. He did not procure the commitment, and his right to compel a conveyance did not, therefore, mature.

The judgment of the Court of Civil Appeals is reversed and that of the trial court affirmed.

Opinion adopted by the Supreme Court.


author: SMEDLEY, Commissioner.

text:
    TOPLETZ et al. v. WOODS.
    No. 1847—7592.
    Commission of Appeals of Texas, Section B.
    Nov. 6, 1940.
    George T. Burgess, of Dallas, for plaintiffs in error.
    J. E. Burkholder and Harvey C. Ford, both of Dallas, for defendant in error.
   SMEDLEY, Commissioner.

Defendant in error, Susie Woods, sued plaintiffs in' error, S. Topletz and others, for cancellation of a trustee’s sale of real estate and deed under power of sale given in a deed of trust executed by her to secure a note and for recovery of the property. After defendant in error had introduced her evidence and rested the trial court instructed the jury to return a verdict in favor of plaintiffs in error and rendered judgment that defendant in error take nothing. The majority of the Court of Civil Appeals reversed the judgment of the trial court and remanded the cause, holding that evidence offered by defendant in error raised issues of waiver and es-toppel. Chief Justice Bond, in a dissenting opinion, expressed the reasons for his belief that the trial court’s judgment should be affirmed. 126 S.W.2d 781.

Susie Woods borrowed about $14,000 from plaintiffs in error, S. Topletz and M. Saffir, and on May 24, 1927, executed therefor her two promissory notes, one for $8,500 payable to Topletz, due five years after date, and the other for $5,-872.62 to the order of Saffir, payable in monthly installments of $150 per month {except six of the installments, which were for slightly larger amounts) with provision that the monthly payments made should be applied first to the interest on the note for $8,500 and second and third to the interest and principal on the note for $5,872.62. The notes were secured by deeds of trust executed by Susie Woods conveying to a trustee certain lots owned by her on which was constructed, by the use of the borrowed money, an apartment house. The deeds of trust contained the usual provisions, among them being the requirement that the debtor should keep the property insured against fire and tornado in favor of any holder of the secured indebtedness to the full insurable value of the improvements. It is shown . that compliance was had with this requirement, although there is no proof in the record as to the contents of the policy or policies of insurance. We assume that the policies contained the standard loss payable or mortgage clause by which any loss or damage “shall be payable to mortgagee named in face of policy as such interest may appear.”

By oral agreement of the parties rentals received for the apartments were paid to the holder of the notes and Susie Woods from time to time made other small payments. Maturity of the $8,500 note was extended by written agreement in 1932 so that the note became due on May 24, 1935. It is impossible for us to determine from the evidence in the statement of facts how much of the principal of the $5,872.62 note had been paid when a fire damaged the building on May 30, 1935. Plaintiffs in error assert in the application for writ of error and in their brief filed in the Court of Civil Appeals that on the date last mentioned all of the unpaid installments of that note were, according to its terms, past due. The correctness of such assertion is not questioned by defendant in error and the majority opinion of the Court of Civil Appeals states that both notes were on their face past due on May 30, 1935. Following the fire, adjustment of the loss was made and the insurance company issued its checks, in the total sum of $4,195.01, agreed upon by the parties including Susie Woods, making the checks payable to the order of Susie Woods, S. Topletz, M. Saffir and Jack Barr, who was the adjuster.

Susie Woods testified that she proposed to S. Topletz that he let her have $1,-200 of the proceeds of- the insurance to repair the house, but that he declined to do so unless she would agree to let Saf-fir make the repairs and she would not agree to that. She testified further that whep. the checks were received from the insurance company she declined to endorse them, but that later L. 'Topletz, who was bookkeeper for plaintiffs in error, Topletz and Saffir, told her that if she would endorse the checks he would let her have the $1,200 to repair the building and the balance of the money would be applied to the notes, and that because of that promise or agreement she endorsed the checks on July 11, 1935. Her testimony further shows that plaintiffs in error did not give her any of the proceeds of the insurance after the drafts were collected about two weeks later but applied all of it upon the notes and told her that they were going to foreclose, and that thereafter they foreclosed the lien by causing the trustee to sell the property. The trustee’s deed does not appear in the statement of facts and there is no evidence showing when or to whom the trustee’s sale was made. However, defendant in error’s original petition, which was offered in evidence, and the amended petition on which the case was tried, contain allegations that the land was advertised by the trustee to be sold on the first Tuesday in September, 1935, under the deed of trust given to secure the $8,500 note payable to Topletz, re-advertised for sale on October 1, 1935, and on that date sold by the trustee to S. To-pletz for $6,000.

The contention made by defendant in error, and sustained by the majority opinion of the Court of Civil Appeals, is that although both notes were, according to their terms, past due when the trustee’s sale was made, the testimony of defendant in error raised as an issue or issues of fact waiver by plaintiffs in error of .the default in the payment of the notes or estoppel to enforce their payment by foreclosure. The testimony relied upon as sufficient to raise such issues is that plaintiffs in error over a long period accepted rentals collected for the apartments and other small payments made from time to time by defendant in error, including an interest payment of $8.75 made three days after the maturity of the $8,500 note as extended and three days before the fire, and never at the time any of such payments were made and accepted demanded payment of the full amounts due or threatened foreclosure; and further that L. Topletz after the fire agreed that she might use $1,200, of the proceeds of the insurance to repair the property and that the balance would be applied to the notes.

We are unable to find in this testimony evidence tending to prove either an agreement to extend maturity of the notes or a waiver of those provisions of the notes and deeds of trust by which the notes were due and payable at specified times and the holder authorized in the event of default in payment at maturity to direct the trustee to sell the property.

The case is not like Ward v. Scarbrough, Tex.Com.App., 236 S.W. 434, and similar decisions relied upon by defendant in error, in which it was held that the holder of a note, giving him the option to declare the entire indebtedness due for failure to pay an annual installment of interest, waived his right to declare the indebtedness due for nonpayment of an installment of interest by his agreement with the debtor to extend the time for the payment of that installment for a year rather than to' enforce collection of the note. In the instant case there is no question as to waiver of option to declare the entire indebtedness due. Defendant in error asserts a waiver of the maturity of the debt as evidenced by the written instruments, which is in effect an extension or agreement to extend the maturity of the notes. And the testimony relied upon as tending to prove such waiver or extension is, aside from testimony as to the agreement with L. To-pletz, that plaintiffs in error from time to time accepted payments on the notes in amounts less than that due without demanding full payment and without threatening foreclosure. The receipt given for the payment of $8.75 made May 27, 1935, three days after the first lien note of $8,-500 as extended became due, states that the payment is to apply as deposit on first lien interest, indicating, as does the entire record, that there was then interest in a larger amount past due on that note.

The agreement that L. Topletz made with Susie Woods when she endorsed the checks issued by the insurance company was, according to her testimony, that he would let her have $1,200 of the insurance money to replace or repair the building and that the balance would be applied to the notes. She testified that when she returned to his office for the money about two weeks later he told her that he would not let her have it and was going to foreclose. Plaintiffs in error question the validity of such agreement, by reason of the absence of evidence tending to prove authority of L. Topletz to bind plaintiffs in error and for want of consideration. We do not determine or discuss these questions further than to observe that, since the policies of insurance were made payable to the holders of the notes as their interest appeared and the notes were then past due in an amount, exceeding that agreed upon in the adjustment of the fire loss, it was the right of plaintiffs in error to collect the insurance and apply it upon the notes. Naquin v. Texas Savings & Real Estate Investment Ass’n, 95 Tex. 313, 319, 67 S.W. 85, 58 L.R.A. 711, 93 Am.St.Rep. 855; Camden Fire Ins. Ass’n v. Sutherland, Tex.Com.App., 284 S.W. 927; House v. Brackins, Tex.Civ.App., 130 S.W.2d 917; Wheeler v. Factors’ & Traders’ Ins. Co., 101 U.S. 439, 25 L.Ed. 1055.

Neither a breach nor a performance of the agreement made by L. Topletz would affect the right of plaintiffs in error to foreclose the lien by trustee’s sale, for, when all of the proceeds of the insurance were applied to the notes, there remained a large amount of principal past due and unpaid, and if $1,200 from the insurance had been given to Susie Woods to make repairs, a still larger amount of principal would have remained past due and unpaid. Defendant in error did not testify to a promise or agreement that after the use of the $1,200 for repairing the house and the application of the balance to the notes, the unpaid balance due on the notes would be extended or that she .would be given time to pay the balance or procure a new loan. The agreement made and breached was, according to her testimony, that she should have the $1,200 to use for repairs and that the balance would be applied to the notes.

Estoppel is not raised by the evidence. There is no evidence tending to prove that plaintiffs in error by any act, promise or agreement induced defendant in error to believe that the time for the payment of the past-due balance on the notes would be extended or that foreclosure would be deferred for any definite period or for a reasonable time, or that she relied upon any such act, promise or agreement to her injury. The checks in payment of the insurance were cashed on July 11, 1935, and soon thereafter she was advised that the lien would be foreclosed. The trustee’s sale was made more than two months later, on October 1.

The trial court did-not err in granting plaintiffs in error’s motion for instructed verdict. Accordingly, the judgment of the Court of Civil Appeals is reversed and the judgment of the district court is affirmed.

Opinion adopted by the Supreme Court.


text:
    KOUNTZE et al. v. SMITH et al.
    No. 2313—7507.
    Commission of Appeals of Texas, Section A.
    Nov. 6, 1940.
    Kenneth S. Finlayson, of Omaha, Neb., McCartney, McCartney & Johnson, of Brownwood, and Coke & Coke and Julian B. Mastin, all of Dallas, for plaintiffs in error.
    McClellan, Lincoln & Jones, of Waco, and Woodruff & Holloway, of Brown-wood, for defendants in error.
   GERMAN, Commissioner.

This suit was instituted in the district court by defendant in error, Mrs. Grace W. Smith, joined by her husband, A. Foster Smith. They will be referred to herein as plaintiffs. The case took the form of an action in trespass to try title, plaintiffs claiming an undivided interest of 107/27000ths in about 21,000 acres of land. Charles T. Kountze and Denman Kountze were defendants, and will be so designated here. The trial court found that plaintiffs did not have such title in the lands as would sustain an action in trespass to try title, and rendered judgment that plaintiffs take nothing. The Court of Civil Appeals reversed the judgment of the district court and rendered judgment in favor of plaintiffs. 119 S.W.2d 721.

■ It is undisputed that prior to June 11, 1908, Charles T. Kountze and Luther L. Kountze were owners in fee simple of .about 69,032 acres of land and 457 town lots situated in the State of Texas. Prior •to that date plaintiffs had no title, either legal or equitable, in said lands and town lots, as will be hereinafter more fully shown. Whatever interest they possessed arose under a declaration of trust executed by Charles T. Kountze and Luther L. Kountze June 11, 1908, and by virtue •of their ownership of certain certificates issued under that agreement. They claim that the trust agreement has terminated by reason of its own terms, and that by virtue of their ownership of ■ the certificates they have become invested with an equitable title to an undivided interest in the lands, and hold .same as tenants in common with the' other owners of certificates.

The substance of all material provisions of the agreement of June 11, 1908, are set out in the opinion of the Court of Civil Appeals, and it is not necessary to reproduce them fully here. We will refer to some of the provisions which we think undoubtedly show that it was never the intention of the creators of the trust to invest the certificate holders with an equitable title to the properties in question. •

Before doing so, however, it is appropriate to observe that the situation here is entirely different from the situation where there is an express separation of the legal and equitable titles, and the beneficiaries are expressly vested with an equitable title. It is also different from the situation where various owners of land vest the legal title in a trustee, to be administered according to the terms of a trust agreement for the benefit of the beneficial owner. The so-called “trust” in this instance is a contractual status, created by the owners of both the legal and equitable title, wherein they retain in themselves all title, subject to a self-imposed obligation to administer the properties for the accomplishment of a specific purpose. The rights of certificate holders are created solely by the contract and certainly cannot arise higher than the terms which the creators of the trust have themselves prescribed.

With these preliminary remarks we notice some of the provisions of the trust agreement. Emphasis is supplied by us.

After a recital that the makers of the trust have acquired the lands in fee simple as joint tenants, with all the rights of such tenants at common law, there is the following recital: “Whereas, the price paid by said Charles T. Kountze and Luther L. Kountze for the aforesaid property amounting in the aggregate to $534,000.00, has been refunded and repaid to them by the following persons, in the following proportions, to-wit(Then follows names of contributors and amounts paid by each.)

It is almost useless to observe that under our decisions no trust arises merely because of the refunding or repaying of a part of the purchase price after title has vested in the named grantee. Allen v. Allen, 101 Tex. 362, 107 S.W. 528; Solether v. Trinity Fire Ins. Co., 124 Tex. 363, 78 S.W.2d 180; Roach v. Grant, 134 Tex. 10, 130 S.W.2d 1019.

This, in the particular instance, is made perfectly clear by the succeeding language of the agreement as follows:

“Whereas, said Charles T. Kountze and Luther L. Kountze are about to make, execute and deliver to each of the parties aforesaid so refunding and repaying to them a portion of the purchase price so paid by them for said property, certificates evidencing the share of such party in the rights and benefits created by and provided for in this Declaration of Trust, such party being entitled to one share for each seventeen dollars and eighty cents so refunded and repaid as aforesaid to said Charles T. Kountze and Luther L. Kountze. The total number of shares for which certificates are to be issued being thirty thousand. Said certificates to be in form or substantially in the form following, to-wit:” (Here is form of certificate.).
“Aforesaid certificates so to be issued as aforesaid and the rights and benefits acquired thereby under this Declaration of Trust shall constitute the full and only consideration for the several sums of money so repaid and refunded to the said Charles T. Kountze and Luther L. Kountze as aforesaid.”

Next follows the declaration of trust upon which plaintiffs strongly relied, to-wit : “Now, therefore, we the said Charles T. Kountze and Luther L. Kountze, for ourselves, our heirs and assigns do, by these presents, make known, admit and declare that all of the said property conveyed to us as aforesaid, by said Texas Land and Cattle Company, was conveyed to us and we now hold and shall and will continue to hold same and any and all income, revenue, and proceeds thereof, and every part thereof, upon the terms, trusts, and for the purposes following, that is to say:”

In the opinion of the Court of Civil Appeals will be found the substance of the succeeding provisions of the contract. It is wholly unnecessary to reproduce all of such provisions but it is important we think to give emphasis -to certain portions of same. Section II of said instrument, among other things, provides as follows:

“The trustees shall have and exercise the management, control, and ownership, both legal and equitable, of said property conveyed, * * * ;• but they shall account to the certificate holders for all of said property. And all other property which may become subject to the trust hereby created and for the proceeds thereof and the income and revenue therefrom arising. * * *
“They shall have all the powers in respect to said property of an absolute owner. Said powers shall include, among others, the full and unrestricted power of improving, leasing, incumbering, selling, granting, and conveying with or without covenants of warranty in their discretion, or otherwise disposing of the same or any part or parcel thereof or interest therein, in fee simple or otherwise. * * * ”

Section 3 provides the following: “The holders of said certificates shall be entitled to participate according to the number of their shares in the rights and benefits of the certificate holders under this-instrument, and they shall be entitled to all the benefits of all the lands and other property and the proceeds, revenue and income thereof, which are or become subject to the terms of this instrument. It is hereby expressly agreed that any holder or transferee of any such certificate by assignment or otherwise takes and holds the same subject to all'the terms and provisions of this instrument. By an assignment and transfer of any such certificate the assignor ipso facto parts with all his rights in, to or under such certificate and under this instrument as against all other certificate holders and the trustees. It is also expressly agreed by and between the persons, firms and corporations who at any time may be the holders or owners of said certificates that the said certificates «■and the rights and benefits evidenced thereby are and shall be held and construed to be in all respects personal property, and shall in no wise pass to or vest in the heirs or devisees of any owner or holder thereof as real estate

The certificates held by Mrs. Smith passed to her by inheritance.

There are . other provisions pertaining to the keeping of books and accounts by the trustees, the making of annual reports, compensation of trustees, and the removal and substitution of trustees. There is also a provision as follows: “Any trustee resigning or removed as aforesaid and the heirs, executors, devisees or other representatives of any deceased trustee, and the remaining trustee then acting, if there be one, shall make, execute and deliver such special warranty deeds or other instruments of conveyance, transfer or assignment as shall be necessary or proper to vest in the trustees for the time being jointly with survivorship as at common law the title to the lands and premises and other property subject to the trusts of this instrument.”

Section X of the instrument is as follows: “The trust hereby created shall be closed and wound up as quickly as the best interests of the certificate holders will permit, but in no event shall said trust exist or continue longer than twenty-five years from the date hereof.”

Section XI is in part as follows: “Inasmuch as during the continuance of the trust hereby created, it may happen by reason of events and circumstances not now foreseen that it may be for the best interest of all parties hereto to make some changes or modifications in the provisions of this instrument, it is hereby expressly agreed and provided that this instrument may at any time and from time to time be changed or modified by a vote of the holders of not less than a majority in amount of the certificates outstanding at a meeting of the certificate holders called and held upon the notice and in the manner hereinbefore provided.”

There is also a further provision to this effect: “The certificate holders, at any meeting duly called for that purpose but not otherwise, shall have power to order and direct a sale or disposition of all the property held by the trustees under the trusts of this instrument and a winding up of the trust; provided that such order and direction must be authorized by vote of the holders of at least a majority in' amount of the total certificates outstanding; and provided that such order and direction shall be reduced to writing and signed by the holders of at least a majority in amount of the total certificates outstanding; and provided further that no such order or direction shall be given unless the notice of the meeting shall expressly state the intention to take action in reference to such sale or disposition of the property and winding up of the trust.”

The trial court, among other things, found as follows: “From the creation of the trust until January 3, 1933, the trustees sold approximately 50,000 acres, leaving unsold approximately 21,000 acres. This unsold acreage comprised the cull remaining after the more marketable lands had been sold. In January, 1933, there was one well on the unsold land, which was then producing about 53 barrels of oil daily, and in addition there were three ‘stripper’ wells which were then producing collectively about 7 barrels of oil daily, making a total daily oil production in January, 1933, of around 60 barrels. The future oil possibilities on these unsold lands in January and on June 11, 1933, were unknown. I find that due to the then prevailing economic conditions that the trustees, after diligent efforts, were unable to sell the remaining 21,000 acres at a fair and reasonable price, by June 11, 1933. Certificate holders holding in excess of 19,000 shares protested any sales except for amounts which would represent fair and reasonable prices, which could not be obtained. The trustees also continuously endeavored up to and including the year 1933, to sell the surface of said lands, reserving the mineral rights, the values of which were then speculative and unknown, but due to the depressed economic conditions prevailing, such sales could not be consummated.”

On June 11, 1933, holders of about two-thirds of the certificates, pursuant to proper notice, voted to extend the trust with all of its terms, conditions and provisions, for an additional period of twenty-five years from and after that date.

It may be regarded as obvious that this action of trespass to try title cannot be maintained by plaintiffs except upon the theory that the trust created by the instrument of June 11, 1908, terminated at the end of twenty-five years from that date. Much of the briefs and arguments of counsel for plaintiffs is devoted to a discussion of the proposition that the trust did completely terminate at that time. While we entertain no doubt that the trust is still subsisting, however, we are convinced that even if the trust created by the agreement were terminated, plaintiffs still would have no title, legal or equitable, on which to maintain the present suit.

It is not made to appear with certainty that plaintiffs claim that the certificate holders under the agreement of June 11, 1908, were owners of any equitable title in the lands prior to that date. There is nothing upon which to base a conclusion that they possessed any such title, but on the contrary the written instruments expressly declare that Charles T. Kountze and Luther L. Kountze paid the purchase money and became the owners in fee simple of all these lands prior to the execution of the instrument of June 11, 1908. As pointed out above, the subsequent certificate holders could claim no resulting trust in the land by repaying or refunding a part of the purchase money. Besides, it is expressly declared that the “rights and benefits” acquired under the declaration of trust shall constitute the “full and only consideration” for the sums of money “so repaid and refunded.” This completely negatives the idea that these persons were to have any title in the lands by reason of payments made by them, and the plaintiffs are forced to the contention that the “rights and benefits” ac-qiiired under the declaration of trust amounted to an equitable title to the lands, so that upon termination of the trust they possessed said equitable title freed from control and dominion of the trustees.

As the certificate holders had no title to the lands prior to the declaration of trust, we repeat that their rights and benefits could rise no higher than the rights and benefits conferred by the declaration of trust. Construing this agreement in all of its provisions, we are convinced that the only rights and benefits which it was intended the certificate holders were to receive were in the rents, revenues and income which might arise from the property, and the proceeds of same when finally sold. It was manifestly a scheme for the sale of all this property through the instrumentality of trustees, with an accounting by the trustees of all income, rents, revenues and proceeds to the certificate holders proportionately.

The makers of the declaration were careful by apt language to reserve to the trustees both the legal and equitable title, and by equally apt language declared the interest of certificate holders to be personalty, and inheritable as such. It is the “income, revenue and proceeds” which they are to hold in trust. They are to keep books showing “all sales, leases and purchases made, their receipts and disbursements.” In their discretion they may distribute pro rata any moneys in their hands belonging to the trust under the declaration whenever in their opinion such moneys are sufficient for that purpose. They are to make annual reports showing the “receipts and disbursements,” and when such reports shall be approved by any certificate holder in writing, the same shall be considered “an accounting by the trustees to such certificate holder to the date of the report so approved, and acquiescence by such certificate holder in the acts and doings of the trustees to that date, and such certificate holder shall thereafter be forever debarred from asking for or compelling by suit or action in any court any further accounting from the trustees in respect to the trust to the date of the report so approved.” It is expressly declared that “the certificate holders, at any meeting duly called for that purpose, but not otherwise, shall have power to order and direct a sale or disposition of all the property held by the trustees under the trust of this instrument and a winding up of the trust.”

Paragraph X relied upon as showing termination of the agreement provides “the trust hereby created shall be closed and wound up as quickly as the best interests of the certificate holders will permit.”

The provisions with reference to winding up the trust alone raise a clear implication that the dominant purpose of the agreement was the sale of all the properties, with distribution of the proceeds. See May v. Brewster, 187 Mass. 524, 73 N.E. 546; William v. Morris, 144 Or. 620, 25 P.2d 135.

No provision for devolution of the title to land was made, but all parts of the agreement forcefully negative the thought that there was to be a residue of lands to be owned jointly by« the various certificate holders. The declaration clearly contemplated a disposition of the whole estate in a manner conducive to the best interests of the certificate holder.

This being the correct construction of the declaration we think the authorities establish beyond question that the only “trust” created was one in personalty and not in the real estate itself. This being true, plaintiffs as certificate holders do not have and cannot have such title in the lands as will support an action in trespass to try title. As said by the Supreme Court of the United States in the case of Anderson v. Wilson, 289 U.S. 20-28, 53 S.Ct. 417, 77 L.Ed. 1004, in a situation which we think is analogous, what the certificate holders do have is a “right in equity to compel the performance of the trust.” If the contract be subsisting, they have this right by virtue of its express terms, as well as in equity, if there be fraud or dereliction of duty on the part of the trustees, and defendants admit they still have this right, even if the trust be regarded as terminated.

The dominant purpose of the trust being the sale of all these properties and distribution of the proceeds, the trust necessarily remains active until that purpose be accomplished. No certificate holder can be allowed to destroy that purpose, for that would destroy the contract and establish one not contemplated by the trustors.

The conclusion thus reached is deducible from the following authorities: Smith v. Kinney’s Executors, 33 Tex. 283; Anderson v. Wilson, supra; Johnson v. Lee, 228 Ill. 167, 81 N.E. 834; Mallory v. Russell, 71 Iowa 63, 32 N.W. 102, 60 Am. Rep. 776; Knight v. Gregory, 333 Ill. 643, 165 N.E. 208; William v. Morris, supra.

The judgment of the Court of Civil Appeals is reversed. The judgment of the trial court is reformed to such extent that plaintiffs will not hereafter be deprived of their equitable right to have the trust performed if and when it may be necessary and equitable to do so. The question of proper parties in such an action may then be settled. As thus reformed,'the judgment of the trial court is affirmed.

Opinion adopted by the Supreme Court.


author: GRAVES, Judge. BEAUCHAMP, Judge.

text:
    Ex parte TOWNSEND.
    No. 21297.
    Court of Criminal Appeals of Texas.
    Oct. 16, 1940.
    Rehearing Denied Nov. 20, 1940.
    Taylor, Irwin & Irwin, Wallace B. Moore, and W. C. Graves, all of Dallas, for appellant.
    H. P. Kucera and W. B. Pope, both of Dallas, and Lloyd W. Davidson, State’s Atty., of Austin, for the State.
   GRAVES, Judge.

Relator was held under a complaint filed in the city court of Dallas County, Texas, in which he was charged with a violation of a certain city ordinance, being No. 2691, which ordinance was concerned with the use, handling, storage, keeping, manufacture and transportation of flammable oils and hazardous materials, etc., in said city.

He sued out a writ of habeas corpus before a county judge of that county, and, upon a refusal to grant his discharge, he appealed to this court.

Relator raises but one question on this appeal, and that has to do with the hereinafter quoted portion of such ordinance, the same being paragraph 4 thereof as follows:

“Emergency and Discharge . Control. Each compartment of a gravity discharge truck shall be equipped with a reliable and efficient shut-off valve located inside the shell of the tank in the compartment outlet, and except during delivery operations, such valve shall be automatically kept closed, or shall be so interlocked with the delivery operation, it will be mechanically closed when said delivery operations are completed and provision for this mechanical closing available at each end of the tank.
“All exterior control connections of emergency valves shall be made above the liquid level, and in the bucket box shall be located a closing device protected by a fusible link and such device shall be common to all valves.
“Each emergency valve shall incorporate an efficient break point so located that its rupture shall leave the valve intact.”

It is contended that the phrase “a reliable and efficient shutoff valve” is so vague, indefinite and uncertain, and of such doubtful construction, that it can not be understood from the language in which it is expressed, and therefore offends against the provisions of article 6 of our Penal Code.

That the city of Dallas has the power to legislate relative to the storage, transportation and handling of oils and gasoline will doubtless be granted, and such is expressly so held by the Supreme Court of this State in the case of Lombardo v. City of Dallas, 124 Tex. 1, 73 S.W.2d 475; it is therein also held that an order to hold an ordinance invalid, it must be clearly and plainly unreasonable (73 S.W.2d at page 486).

However, relator’s contention, is that no one can understand what is demanded of him in said ordinance wherein it directs that his truck tank shall be equipped with “a reliable and efficient shut-off valve.”

In construing these words, unless they have some technical or special meaning different from their usual and accepted import, we have the statutory admonition that they are to be taken and construed in the sense in which they are understood in common language. See article 8, Penal Code.

Then let us see what “reliable and efficient” means in common language. As-reflected by the dictionary “Reliable” means-suitable or fit to be relied upon; worthy of dependence or reliance; trustworthy. “Efficient” means producing results, not inactive nor incapable.

This ordinance therefore requires that such tank trucks shall be equipped with a shut-off valve that is suitable and fit to-be relied upon, trustworthy, and was capable and produced results; that is, a valve: that would cut off any liquid escaping froiu the tank truck through proper channels.

We are impressed with the- belief ‘ that the term “reliable and efficient” conveys the idea intended to be expressed in simple language that would be understandable to any ordinary mind. In other words, such phrase means a shut-off valve that would shut off a flow of liquid when utilized for such purpose.

We are referred to the case of Houston & T. C. Ry. Co. v. Stevenson, Tex.Com.App., 29 S.W.2d 995, an opinion by Justice Sharp, in which he , holds that the phrase “adequate brakes in good working order” was sufficiently plain and certain to apprise a person of what the legislative intent and meaning was in the use of-such words, and did not offend against article 6, P. C. We are also referred therein to the case of Galveston, H. & S. A. Ry. Co. v. Enderle, Tex.Civ.App., 170 S.W. 276, wherein it was held that the phrase “sufficient and secure grabirons,- handholds, and foot stirrups” was plain and simple language and capable of being understood by anyone affected thereby, the word “sufficient” meaning therein fitness to answer the purpose for which it was intended.

Again therein he quotes from the case of State of Texas v. International & G. N. Ry. Co., 107 Tex. 349, 179 S.W. 867, relative to the phra.se “light repairs,” in which said phrase was not held indefinite.

We are also cited to the case of State of Texas v. Texas & P. Ry. Co., 106 Tex. 18, 154 S.W. 1159, 1161, construing what is commonly known as the “water closet” statute. Justice Phillips’ concluding paragraph therein should at least be.persuasive in this matter. He says: “Neither do we regard the act inoperative or violative of either the federal or state Constitution because of any vagueness or uncertainty in its terms. A requirement that the water-closets be kept in a reasonably clean and sanitary condition, that they be located within a reasonable and convenient distance from the passenger depots or be kept in connection therewith, and that they be kept well lighted, presents no difficulty to the understanding, and should present none in its observance. Its terms are suitable to the subject-matter of the act; and, having regard for the difference in conditions at the stations upon railway lines where it is made operative, the use of more specific language would very probably have provided only an arbitrary and impracticable rule.”

As sustaining his position relative to the unsoundness of this ordinance, relator refers us to the case of Ex parte Wilmoth, 125 Tex.Cr.R. 274, 67 S.W.2d 289, commonly called the taximeter case, in which an ordinance of the city of San Antonio provided in substance that each taxicab in said city should be equipped with a “meter of standard size and design to be approved by the chief of police,” etc. This court held such ordinance invalid, its reasoning being based, however, upon the improper delegation of power therein to the chief of police to say whether such taximeter was of a standard size and design. We do not think such a holding of benefit to us in the decision of this case.

That the handling of oils, gasoline, etc., is a hazardous occupation is not denied, and we think that this ordinance requiring a reliable and efficient cut off valve to be a part of the equipment of a tank truck handling such materials within the city of Dallas comes within the police power delegated to and inherent in city governments of this State. We are also of the opinion that the terms of this ordinance No. 2691 are sufficiently' clear and plain so that he who runs may read and understand its plain and intelligible terms to mean that such truck must be equipped with a cut off valve that can be depended upon to cut off the flow of liquid from such tank truck.

The judgment of the trial court is affirmed.

On Motion for Rehearing.

BEAUCHAMP, Judge.

As stated in the original opinion, only one question is presented on this appeal. In his motion for rehearing appellant takes the same position as that which was thoroughly considered on the submission of the case. No authorities have been presented which modify our original conclusion, and we think that the opinion amply discusses the question presented, and that the right conclusion was reached.

The motion for rehearing is overruled.