text:
    LAUBHAN et al. v. ALLIANCE LIFE INS. CO.
    No. 5063.
    Court of Civil Appeals of Texas. Amarillo.
    Oct. 16, 1939.
    E. C. Gray, of Higgins, for appellants.
    Morgan, Culton, Morgan & Britain, of Amarillo, for appellee.
   FOLLEY, Justice.

This case has quite a history in this court and in the Supreme Court of Texas. The cause first reached here on an appeal from the District Court of Lipscomb County, Texas, in which the Peoria Life Insurance Company was the plaintiff in the trial court and the defendants were Bar.bara Laubhan, individually and as adminis-tratrix of the estate of her deceased husband, Alex J. Laubhan, and the children of the Laubhans. The former appeal involved the authority of the district court to establish a lien upon the homestead of the Laubhans, the estate of the deceased being in the process of administration in the probate court. This court submitted the controversy to the Supreme Court of Texas upon certified questions which were answered in Laubhan et al. v. Peoria Life Ins. Co., 129 Tex. 225, 102 S.W.2d 399, in which opinion will be found a discussion of the jurisdiction of the district court under the facts that existed in the former trial of this case. We refer to such opinion for a statement of the basic facts which still obtain in the present record. However, for the purpose of a true appraisal of the present status of the case, we deem it expedient to restate the history and background of the present litigation.

In 1916 Alex J. Laubhan contracted with Thomas C. Spearman of Cook County, Illinois, to purchase the N% of Section 1136, Block 43, in Lipscomb County, Texas, consisting of 324 acres of land. The consideration was $9,723. Of this amount $500 was paid in cash, and the balance was payable in annual installments of $1,152.-88 each. A deed was to be delivered only upon the payment of the purchase price in full. Laubhan and wife entered into immediate possession of the land and established a homestead on the east 200 acres of the tract. Thereafter, in December 1918, Laubhan contracted with Nelson W. Willard of Cook County, Illinois, for the purchase of the SWj4 of Section 1153, containing 162 acres of land, and being in the same block and adjoining section 1136. The consideration for this land was $4,-053.12. Of this amount $400 was paid in cash and the balance was payable in seven annual installments. This contract had the same provisions as to the delivery of a deed as did the contract with Spearman for the N% of Section 1136. On January 24, 1927, A. W. Kincade and wife deeded to Laub-han the W½ of Section 12, Block 10, in Lipscomb County, Texas, containing 323.1 acres. In connection with such purchase Laubhan executed eight vendor’s lien notes, the first in the sum of $3,000 and the other seven in the sum of $1,000 each. The first three of these notes were acknowledged paid and released by Kincade in an instrument dated April 26, 1929 transferring to the Commerce Farm Credit Company the ■other five notes.

On June 24, 1926 Alex J. Laubhan and. wife executed a note in the sum of $8,000, payable to Wm. L. Sharp, and to secure said note Laubhan and wife executed a deed of trust to R. O. Renfrew upon the SW14 of Section 1153 and the N% of Section 1136, aggregating 486 acres of land. The legal title to this 486 acres of land was then vested in Nelson W. Willard. The trust deed recited that the mortgagors were in possession of the land under and by virtue of a contract to purchase the same; that they had theretofore paid a portion of the purchase price but that mortgagors represented there was still owing on said lands a sum in excess of the debt thereby secured; that the note for $8,000 therein given was for. moneys to be applied upon the purchase price; and that Sharp should have a first lien upon all the land to secure the purchase money advanced by him. The record shows that Nelson W. Willard received $10,870.89 from Sharp’s company in connection with this loan, the difference in such amount and the amount of the loan having been paid to Sharp in cash by Laubhan. It is also shown that an indebtedness due the State of Texas upon the land was paid by the mortgagee by money furnished by Laubhan. After these transactions Willard delivered to Laubhan deeds to the N% of Section 1136 and the SW^ of Section 1153, reciting cash considerations in conformity to the original contract prices on these two tracts of land.

On February 14, 1929 Laubhan made an application to the Commerce Farm Credit Company for a loan of $13,000 to be secured by a blanket lien upon all of the land above mentioned, consisting of about 807 acres. In this application Laubhan stated that his homestead was worth $15,-00Q but was encumbered for $8,000. In answer to questions in his application as to the indebtedness on the property, he answered : “Deed of trust to Wm. L. Sharp, Chicago, Ill., on 480 acres in amount of $8,000.00; $6,000.00 vendor’s lien notes held by A. W. Kincade, Follett, Texas, on 320 acres.” The loan was made and a trust deed executed by Laubhan and wife to secure the $13,000 upon the 807 acres of land. Three notes were executed in connection with this loan, two in the sum of $500 each and one in the sum of $12,000. This deed of trust recited that the notes were given for money advanced by the Commerce Farm. Credit Company to take up and discharge the balance of the indebtedness against the land, partly evidenced by the $8,0.00 due Sharp in the first loan and partly evidenced by five notes above mentioned of $1,000 each payable to A. W. Kincade in connection with the purchase of Section 12.

About September IS, 1932 Alex J. Laubhan died intestate. Thereupon his wife qualified as administratrix of his estate. On February 23, 1933, in response to her petition, the County Court of Lipscomb County entered an order setting aside (the east 200 acres of the N% of Section 1136 as a homestead for her and her children, free and clear of all existing liens upon the same. A short time thereafter the Peoria Life Insurance Company filed its claim under article 3515a, Vernon’s Annotated Revised Civil Statutes, for the unpaid balance on the $13,000 loan, alleging a lien upon all the property and asking that the same be approved and fixed as a lien. In this claim it was shown that one of the $500 notes had been paid, leaving $12,500 of the principal of the loan unpaid. On May 4, 1933 the administratrix approved the claim as a money demand against the estate but rejected the lien claim against the 200 acre homestead. Thereafter the Peoria Life Insurance Company filed suit in the District Court of Lipscomb County, Texas, to establish its claim as a preferred debt and lien against the estate of Alex Laubhan, deceased. In such suit judgment was rendered allowing the claim and fixing the same as a preferred lien, but the original debt of the second loan being for $13,000 on the 807 acres and the original lien being for only $8,000 against the 480 (486) acres, the judgment allocated to said 480 (486) acres ¾3 of the total amount due, and allowed the claim and fixed it as a preferred lien as against the original 480 (486) acres. From that judgment the first appeal was brought to this court which was predicated upon the authority of the district court to render such a judgment upon the claim filed therein. The Supreme Court, in the opinion found in 129 Tex. 225, 102 S.W.2d 399, 405, held that the procedure provided by article 3515a, passed by the Legislature in 1931, did not apply in the case of a deed of trust executed prior to the passage of the Act, and, since the administratrix formerly had no authority to pass on the lien features of the claim no question was raised that would give the district court original jurisdiction. In making this holding, however, the Supreme Court made this observation : “There is an exception to this rule to the effect that, if a cause of action such as is here in question involves some legal or equitable right connected with the claim for the adjudication of which the powers of the probate court are inadequate to grant the claimant the full relief to which he is entitled, the district court has jurisdiction in an original action for such purpose.”

Other observations were therein made as to the procedure necessary for the claimant to pursue in order to obtain the full relief to which it was entitled. Upon the Supreme Court’s holding in that appeal this court in an opinion in 105 S.W.2d 286 reversed the former judgment with instructions that the pleadings should be made to conform to the holding of the Supreme Court with reference to proceeding under the law as it existed prior to the 1931 Act and that if such pleadings did not so conform to the suggestions of the Supreme Court in this respect that the cause be dismissed.

Another phase of this case reached this court by a former appeal. From the order of the probate court setting aside the 200 acres for the homestead for Mrs. Laubhan and her children and declaring such land free from the liens in question, an appeal was prosecuted to the District Court of Lipscomb County, Texas. That court enT tered a decree affirming the judgment of the probate court to the extent that it set aside the homestead to the administratrix and her ■ children, but further adjudged that the probate court was without power to cancel and discharge the liens, and that part of the judgment of the probate court was reversed by the district court. From that judgment of the district court an appeal was prosecuted to this court. In such cause, known as Laubhan v. Peoria Life Ins. Co. et al., in an opinion reported in 107 S.W.2d 889, this court affirmed the judgment of the district court.

After the first trial of this cause in the district court the Peoria Life Insurance Company went into the hands of a receiver and the claim and deed of trust lien involved herein were assigned to the Alliance Life Insurance Company, who became the plaintiff below in the second trial and who is now the appellee herein. In conformity to the holdings of the Supreme Court and of this court in the first appeal, the appellee presented an amended claim in compliance with the old procedure prior to the passage of article 3515a, and asserted in said claim that the appellees recognized the fact that under the law prior to 1931 the administratrix had no power to determine the validity of the deed of trust lien asserted by the claimant. The claim thus filed also showed that only $500 of the principal of the $13,000 loan had been paid. The administratrix refused to take any action on the amended claim. Thereupon the appellee filed a second amended petition in the district court setting out the facts herein above outlined and alleged that it had prepared and filed with the administra-trix its claim showing a balance due on the indebtedness in the sum of $19,160.45 as of November 8, 1937. In such petition the appellee further alleged that it had in equity a right of subrogation to the liens and equities of the original holders of the instrument sued upon and that by reason of the contractual provisions of such instruments and the facts in connection therewith, the appellants were estopped to claim the homestead free of any lien. The ap-pellee prayed that its lien be approved by the district court and that it be decreed by such court that a good and valid lien existed in its favor upon all the property above described. Upon a trial of the case the jury, under instructions of the court, returned a verdict in favor of the appellee for 32¾86 of ¾3 of the amount of the claim filed by the Peoria Life Insurance Company. Thereupon the trial court rendered judgment that such claim filed by the Peoria Life Insurance Company, and amended by the Alliance Life Insurance Company, be approved and classified by the probate court as a claim of the third class against the estate of Alex J. Laubhan. The judgment further provided, however, that the 200 acre homestead was subject to 32¾86 of ¾3 of the amount of the claim filed by the Peoria Life Insurance Company, which .sum was found to be $7,603.-50, “for the reason that the indebtedness now held by plaintiff is in renewal and extension of $8,000.00, which was formerly a lien against 486 acres, which includes the homestead, the homestead being located on the North ½ of Section 1136, Block 43, H&TC Ry Co Surveys, which contains 324.1 acres of land, and the Southwest ¼ of section 1153, in Block 43, above described, which contains 162.125 acres of land, and the remaining portion of said indebtedness owing the plaintiff by said estate, to-wit, 16¾86 of %3ths of said indebtedness, ■together with the remaining %3ths of said indebtedness, be fixed as a lien against the west ⅜ of Section 12, Block 10, Certificate %, H. T.'& B. Ry. Co., Surveys, in Lipscomb County, Texas, and the Southwest ¾. of Section No. 1153, Block 43, H&TC Ry Co Surveys in Lipscomb County, Texas.” The court further ordered that attorneys’ fees on the claim be decreed a lien on the SW^, of Section 1153 and against the W% of Section 12, but that no portion of such attorneys’ fees be fixed as a lien against the N½ of Section 1136, containing the homestead. This judgment was ordered certified to the probate court of Lipscomb County, Texas, for observance. From this judgment the present appeal is before us.

It should be borne in mind that this controversy does not involve a foreclosure of any lien but merely the fixing of the amount of the lien to be adjudged against the homestead. The amount of the indebtedness against the estate is not controverted. The controlling question in the case is whether or not the trial court erred in establishing a lien against the homestead for 32⅜86 of ¾3 of this total indebtedness.

The deed of trust held by the appellee as assignee under the second loan in the sum of $13,000 upon the 807 acres of land was in part a renewal and extension of the first loan of $8,000 upon the 486 acres of land. The first loan shows on its face that it was made to enable Laubhan to obtain funds by which he might acquire legal title to the 486 acres, which included the homestead. As above stated the deed of trust given in connection with this first loan recited that the legal title to the land was then vested in Nelson W. Willard; that Laubhan and wife were indebted to Willard under a contract to purchase the land in an amount in excess of the $8,000 debt therein secured; that the note for $8,000 given by Laubhan in connection with the loan was for money to be applied by the mortgagee, Wm. L. Sharp, upon the purchase price of the land; and that Sharp should have a first lien upon the 486 acres to secure this purchase money. The money upon this loan was actually advanced to Willard on the purchase price, and applied upon the indebtedness due the State of Texas in order to secure-a patent upon the land.

At the time the second loan in the sum of $13,000 was made the-$8,000 note of the first loan was' still outstanding. This second loan included as security the 486 acres mortgaged in the first loan and the W% of Section 12, making a total of 807 acres. As above' stated this trust deed recited that the notes aggregating $13,000 secured therein were for money advanced by the Commerce Farm Credit Company to take up and discharge the $8,000 note given in •the first loan and $5,000 in notes that Laubhan owed Kincade on the W% of Section 12. The deed of trust was signed and acknowledged by both Alex Laubhan and Barbara Laubhan. The instrument stipulated that the Commerce Farm Credit Company “shall be and is hereby subrogat-ed to all the rights, titles, liens, remedies and equities now existing to secure and enforce the payment of said notes, all of which are extended and continued with the terms and provisions of this instrument.”

On the issue of estoppel urged by the appellee we do not believe the representations of Laubhan in the application for the second loan with reference to the indebtedness would be such representations as would estop the appellants from denying that the homestead tract was encumbered for the full amount of the $8,000 loan. Although the deceased stated in such application that his homestead was encumbered for $8,000, he also stated in the same instrument that the $8,000 lien was held by Sharp against 480 (486) acres of land, which necessarily included more than the homestead tract. He further stated in the application that he had lived on the land for the past ten years and that the East 200 acres of the N% of Section 1136 had constituted his homestead during such period. In this connection the testimony shows that the Laubhans cultivated the homestead tract in 1916; that half the family moved on the tract in 1917; that all the family moved onto the tract in 1918 where they lived until the death of Alex J. Laubhan in 1932; and that since his death the widow and children have continued to occupy such land as their homestead.

Under the above facts, which are uncontroverted, we think the proof at least fails to acquit the homestead of any chargeable portion of the debt and lien held by the appellee. As t'o how much of the present indebtedness against the 807 acres should be charged as a lien against the homestead presents a more difficult question. The judgment of the ’trial court, in charging against the homestead ?2¾86 of ¾3 of the indebtedness, in effect, charged 32¾86 or % of the original indebtedness of $8,000 on the homestead in connection with the first loan on the 486 acres. This was due apparently by reason of the ratio between the number of acres in the original tract containing the homestead and the 486 acres in both tracts involved. The second fraction of %z is apparently based upon the ratio of the respective amounts of the two loans.

It is our opinion, however, that the court’s charging 82¾86 of the $8,000 loan as a lien against the homestead was unwarranted under the facts in this case. There is no showing as to the amount unpaid as purchase money on the 1S% of Section 1136 nor upon the SW% of Section 1153 at the time the $8,000 loan was made nor at any other time. It is true that the deed of trust executed in connection with the first loan stated that there was “still owing on the contract price of the lands” a sum in excess of the debt thereby secured, but as to how much was due upon each separate tract at such time, the record is entirely silent. In this connection we call attention to the fact that the homestead of the Laubhans was established on the N% of Section 1136 long before the $8,000 loan was made. After establishment of the homestead on the former tract no portion of the indebtedness due upon any other land could be charged as a lien against the homestead, yet the evidence does not show that this very thing was not done by the court’s charging 32¾86 of the $8,000 loan against the homestead. The burden in this respect is upon the appellee. The homestead having been carved out of the N% of Section 1136 after the contract to purchase this tract was made, it is true that the homestead would be chargeable with the unpaid purchase price outstanding against this tract, yet, it should be said in passing, that even in the event of a foreclosure, the administratrix could compel first the sale of the non-exempt land in satisfaction of the debt before resort could be had to the homestead. But in no event could the homestead be impressed for a lien for indebtedness upon other lands after-the homestead was established. Since the Laubhans obtained an equitable title and interest in the homestead tract under the contract to purchase the land in 1916, there can be no doubt that they could establish a homestead upon the land before they acquired the legal title in 1926.

In seeking to uphold the court’s judgment in this respect the appellee contends that the record shows two payments by Laubhan in 1926 totaling $3,600, which, the appellee asserts, were applied upon the SW% of Section 1153, thereby reducing the original indebtedness of $4,053.12 on this tract to a nominal sum, and thus removing the possibility of any overcharge on the homestead in the judgment. It is true the record reveals two receipts issued to Laubhan by A. W. Kincade, one in the sum of $1,300 and the other in the sum of $2,300. The first is dated June 25, 1926 and the second June 12, 1926. They each acknowledged the receipt of the respective sums and each stipulated that such sums were “to apply on land contracts with Nelson W. Willard”. The appellee contends that these receipts show that the money was applied upon the SWJ4 of Section 1153 because such tract was the only tract of land that Laubhan contracted to purchase from Nelson W. Willard. It is true that this tract is the only one the record shows was purchased in a contract with Willard, but before the time these receipts are shown to have been issued the record reveals that the legal title to the N% of Section 1136 and the SW]4 of Section 1153 was in Nelson W. Willard.' How Willard acquired the legal title to the ]S% of Section 1136 from Thomas C. Spear-man is not shown. Anyhow, the term “land coniracts”, as used in the receipts, if signifying anything, would raise the presumption that the money was to be applied upon the indebtedness of more than one tract of land. In this connection it should also be stated that the record fails to disclose any reason why A. W. Kincade would be receiving money or issuing receipts in connection with land he is not shown to have ever had any interest in. The only land with which Kincade is shown to have had any connection was the W½ of Section 12, which fact would be just as persuasive of the proposition that the money evidenced by these receipts related to payments on the W% of Section 12 under some purchase contract not shown in the record as it would be that they related to contracts relative to either of the other two tracts of land. At any rate the receipts are too indefinite to show that 32⅛6 of the indebtedness due at the time the first loan was made was outstanding against the tract containing the homestead, nor is this hiatus in the testimony supplied from any other source. It is entirely possi-ble, and perhaps probable, that upon another trial of this case it will be shown that as much as, or even more than, 32⅛6 of the- indebtedness against the two tracts of land involved in the first loan was then outstanding against the homestead tract, but in the absence of some definite showing as to the amount outstanding against the homestead tract either then or now, we feel unwarranted in allowing the present judgment to stand. While we have no doubt that a potential lien exists against the homestead for a portion of the total indebtedness now outstanding, the amount thereof is indefinite and uncertain under the facts of this case. It is our opinion that -the true criterion with which to determine what portion of the present indebtedness is chargeable as a lien against the homestead should be based solely upon the amount of the indebtedness unpaid upon the purchase price of the N½ of Section 1136 plus whatever interest has accrued thereon, and that in no event should such amount be increased by any other indebtedness of any sort. It is not so much a question of ratio between acres or dollars as it is an issue of how much of that unpaid purchase price of the homestead tract, with accrued interest, still exists and has come on down through the years unpaid, finally merging into the present indebtedness. By reason of the insufficiency of the testimony to support the judgment of the trial court as above indicated this cause must be reversed.

Reversed and remanded.


source: Caselaw Access Project

author: HALL, Justice.

license: Public Domain

text:
    CITY OF LONGVIEW v. MARKHAM-McREE MEMORIAL HOSPITAL.
    No. 5625.
    Court of Civil Appeals of Texas. Texarkana.
    Nov. 28, 1939.
    Rehearing Denied Dec. 14, 1939.

      Bailey M. Salmon, of Longview, for appellant.
    McCall & Dawson, of Longview, for ap-pellee..
   HALL, Justice.

Appellant brought this suit in District Court of Gregg County against appellee for taxes allegedly due by it to appellant for the year 1937. Appellee answered by general demurrer, general denial, and alleged further : “ * * * that it is a corporation organized for the purpose of supporting a benevolent, charitable, and educational undertaking, consisting of the acquisition or the erection and maintenance of a hospital in the City of Longview, Gregg County, Texas, for the purpose of administering to the sick, the infirm, the helpless, the maimed and the afflicted of all creeds, colors and nationalities, receiving and properly caring for all such as may be brought to, or present themselves at such hospital for, such treatment, nursing and care — especially excluding and excepting, however, all such persons as may be suffering from any contagious or mental diseases — and to alleviate the ills, sufferings, pains, and afflictions of all such as are included, as above mentioned, and to restore them, as far as possible, to the best condition of health; and further for the purpose of training and educating young women for the nursing profession. That defendant acquired the land and erected the hospital building here sought to be taxed arid is the sole and exclusive owner of said land and building, and has used and now uses said land and building exclusively for the purposes above set forth. That said defendant is an institution of purely public charity, making no gain nor profit, accomplishing ends wholly benevolent, and bene-fitting persons indefinite in numbers and in personalities by preventing them through absolute gratuity from becoming burdens to the state. That said land and building sought to be taxed is owned and used exclusively by said institution of purely public charity, and hence under the Constitution of the State of Texas and the laws of the State of Texas (Art. 7150(7), Rev.Civ. Stat.1925) said land and hospital building is exempt from taxation by said plaintiff.”

The case was submitted to the court below upon an agreed statement of facts, and upon which judgment was rendered that appellant take nothing. The case is now before this court on the agreed statement of facts which contains the following stipulation:

“Drs. McRee and Bergman have offices in the hospital. They likewise treat many of their patients in the hospital and use its equipment in so doing, but the hospital charges their patients on the same basis and in the same manner as it does the patients of all doctors. They have no privilege in the use of the hospital or its equipment that any other ethical doctor does not have in the treatment of his patients there. The sole distinction between these two doctors and visiting doctors is that these two have offices in the hospital. For these offices they pay the hospital a monthly rent of $100.00, treat the charity patients of the hospital without charge, and remain on hand at the hospital day and night as house physicians to take care of all emergency cases coming to or already in the hospital, whether such patients be their own patients, charity patients, or the patients of other physicians. It is necessary for the proper operation of the hospital that a doctor be at the hospital subject to immediate call at all times. During the past twenty-one months thay have rendered services to charity patients in hospital while acting as house physicians to the amount of $1,888.50 without charge whatever, as well as many services to the patients of other physicians in the hospital when such patients needed immediate care in the absence of the physicians of their choosing. The hospital pays these doctors nothing for these services to charity patients and services performed as house physicians; they charge their own patients which they treat in and out of the hospital for their services without any connection whatever with the charges made by the hospital for its services. The hospital is no more connected or interested in the fees charged by its house physicians than it is in fees charged by visiting doctors. It is the established rule that if the patient in the hospital is unable to pay both his hospital bill and physician’s fee, then the hospital gets paid first before the' physicians accept a cent. There is no connection in the bookkeeping of the hospital and the bookkeeping of its'house physicians nor of -the bookkeeping of any other doctor who treats some of his patients there. * *
“It is also agreed that the sole question at issue is whether the above fact situation creates such a relationship as will destroy the exemption of the charitable institution as to this property.”

Thus we are relieved by the agreement of the parties to this appeal of the necessity of discussing any feature of this case except that relating to the exclusive use of the hospital for charitable purposes. In the stipulation set out above there appears this significant statement: “It is necessary for the proper operation of the hospital that a doctor be at the hospital subject to immediate call at all times.” Thus it is made to appear from the record as an agreed fact that the letting of the offices to the two physicians was for a purpose so closely related to the main object for which said hospital was formed as to come within the general design of the charitable enterprise. And, in our opinion, the collection by the hospital of the $100 per month rent as part payment by the house physicians for the offices occupied by them, under the agreed facts in this case, would not be a sufficient circumstance to rob it of its exclusive use as a purely charitable institution, nor take from it the exemption • from taxation extended by the Constitution of this State, Article 8, Section 2, Vernon’s Ann.St.; and R.C.S. Article 7150, Sec. 7. We think this case is ruled by Santa Rosa Infirmary v. City of San Antonio, Tex.Com.App., 259 S.W. 926, and cases there cited. In Contributors to Pennsylvania Hospital v. Delaware County, 169 Pa. 305, 32 A. 456, 457, it is said: “But property which is used directly for the purposes and in the operation of the charity is exempt, though it may also be used in a manner to yield some return, and thereby reduce the expenses.” See also Board of Supervisors, Warren County v. Vicksburg Hospital, Inc., 173 Miss. 805, 163 So. 382. The record shows by agreement that this hospital, even after collecting the $100 per month rent from its house physicians, has been operated at a loss-of over $2000, nearly double the- amount of taxes sought to be collected from it.

“The theory upon which institutions of this character are exempted from taxation is that they serve the government by relieving it to some extent of’what would otherwise be a public duty or governmental function to care for the indigent sick and afflicted, and it is the assumption by such institutions of this burden which compensates the government for the ■ exemption granted them from the general obligation resting upon all citizens to pay taxes.” Santa Rosa Infirmary v. City of San Antonio, supra [259 S.W. 935],

We conclude, then, that under the agreed facts the Markham-McRee Memorial Hospital is a purely charitable institution devoted exclusively to charitable purposes, and as such, is entitled to exemption from all taxes under Article 8, Sec. 2 of our Constitution, and Revised Civil Statutes, Art. 7150, Sec. 7.

Finding no error in the record, the judgment of the court below is in all things affirmed.


author: FOLLEY, Justice.

text:
    LOTT v. SCOTT et al.
    No. 5175.
    Court of Civil Appeals of Texas. Amarillo.
    Nov. 27, 1939.

      Newland, Cornett & Whitworth, of Linden, for plaintiff in error.
    Sanders & Scott and Howard F. Saunders, all of Amarillo, Ralph K. Jenner, of Hugo, Okl., and R. H. Forrester, of Wheeler, for defendants in error.
   FOLLEY, Justice.

Three motions have been filed in this cause. The first was filed by W. D. Scott, individually, as one of the defendants in error herein, asking that we dismiss the cause for lack of jurisdiction by reason of the alleged improper service of the writ of error, and for alleged irregularities in the writ of error bond. The second motion was filed by W. D. Scott, individually and as independent executor under the will of Belle Lott, deceased, and G. L. Scott and Mrs. Lucy Teasley, defendants in error, asking that we strike the purported statement of facts herein. The third motion was filed by the same parties asking that we strike out particular portions of the purported statement of facts.

We think that where the service of a writ of error is insufficient the rule is not to dismiss the suit but merely to strike the case from the docket and abate the action until the service may be perfected, in which event the cause may be reinstated. Victory et al. v. Hamilton et al., 127 Tex. 203, 91 S.W.2d 697. However, it has been held by this court that where a defendant in error combined with a motion to dismiss the writ an unqualified motion to strike out the statement of facts he thereby waived the right to question the sufficiency of the citation. Brillhart v. Beever, Tex.Civ.App., 198 S.W. 973; Rhoades v. El Paso & S. W. Ry. Co., Tex.Civ.App., 230 S.W. 481. In the instant case the filing of the motion to dismiss and in conjunction therewith the two unqualified motions asking for relief in regard to the purported statement of facts constituted a general appearance in this court by the defendants in error and operates as a waiver of the alleged defects in the service of the citation in error. We have examined the writ of error bond and are of the opinion that it is not subject to the objections urged. The motion filed by W. D. Scott, individually, to dismiss this cause is therefore overruled.

The motions relative to the purported statement of facts, however, present a more serious question. In Pacific Greyhound Lines, Inc., v. Burgess et ux., 118 S.W.2d 1100, in which a writ of error was refused by the Supreme Court, this court held that under the 1931 amendments to articles 2238 and 2239, Vernon’s Annotated Civil Statutes, only two methods remained for the preparation of a statement of facts in an appeal from the district court. The first of these methods is the question and answer form prepared by the official court reporter from his notes. The second is that the parties may prepare their own agreed statement in the manner set out in article 2239. In the instant case neither of these methods was pursued. The trial court certifies that no record of the evidence was made by an official court reporter, and no such statement has been filed in this cause. Moreover, the parties have not prepared and filed an agreed statement of facts as provided by article 2239. The only statement filed herein, and to which the motions are addressed, is one over the certificate of the trial judge which does not conform to either of the methods provided by the above articles of the statutes. This same sort of statement we held in the Pacific Greyhound Lines case was insufficient under the present law. The motion of the defendants in error to strike said statement of facts is granted and said statement as a whole is ordered stricken from the record in this cause.


text:
    TEXAS EMPLOYERS INS. ASS’N v. EBERS et al.
    No. 5054.
    Court of Civil Appeals of Texas. Amarillo.
    Sept. 18, 1939.
    Rehearing Denied Oct. 23, 1939.

      Underwood, Johnson, Dooley & Wilson, of Amarillo, for appellant.
    O’Dowd & O’Dowd, of Waco, for ap-pellees.
   FOLLEY, Justice.

This is a workmen’s compensation suit in which the appellee, Harry J. Ebers, is the claimant, the Phillips Petroleum Company, the employer, and the appellant, Texas Employers Insurance Association, the insurance carrier. In a trial before a jury the appellee recovered a judgment in the sum of $1,478.29, such sum representing compensation for a total disability at the rate of $9.75 per week for 151 weeks from September 9, 1937, the date of the alleged injury. In such judgment appellee’s attorneys were protected for their attorneys fees. The $9.75 was 60% of the $16.32 found by the jury to be a just and fair weekly wage for the appellee.

At the time of the alleged injury, and for more than a year prior thereto, the ap-pellee worked at the Alamo refinery of the Phillips Petroleum Company in Hutchinson County, Texas. Pie alleged that while working on one of the stills of the refinery attempting to loosen a nut with a long handle wrench, he fell to the concrete floor which fall occasioned his injuries, consisting mainly of a fractured spine. The testimony shows without controversy that the appellee received as wages 68‡ per hour for each eight-hour day, but that he was allowed' to work only five days per week, or 260 days per year,

The record shows that the ap-pellee’s wage rate was established, and compensation awarded, under first subdivision 3, section 1, of art. 8309, R.C.S. 1925. The appellant contends that the ap-pellee was not entitled to base his wage scale on first subdivision 3 because the evidence did not eliminate first subdivision 2 of section 1 of the article. We think it is settled under the authorities of this State that under the provisions of this statute the burden is upon the claimant to show it is impracticable to fix his wage rate under first subdivision 1 or 2 before first subdivision 3 can be resorted to. American Employers’ Ins. Co. v. Singleton, Tex.Com.App., 24 S.W.2d 26. It is not contended by the appellant that the appellee failed to eliminate first subdivision 1, section 1 of the article. The testimony is conclusive, we think, that the appellee worked only 260 days of the year immediately preceding his alleged injuries. This fact was shown by witnesses for both parties and is not controverted by any testimony. Under such circumstances we think it is conclusive as a matter of law that the appellee did not work substantially as much as 300 days during the twelve month period immediately preceding his alleged injury. Traders’ & General Ins. Co. v. Bulis, 129 Tex. 362, 104 S.W.2d 488. But a different situation arises in regard to the first subdivision 2, section 1 of the article. The evidence shows not only that the appellee did not work substantially the whole of the year immediately preceding the purported injury but that no employee of the Phillips Petroleum Company- worked more than 260 days during such period. All of the employees of the company were limited to five eight-hour days each week. At this point, however, the evidence terminates on this issue. The record is absolutely silent as to whether or not there were other employees of the same class working substantially the whole of such immediately preceding year in a similar employment in the same place or in a neighboring place. It is our opinion that the language of first subdivision 2 of section 1 of the article does not restrict the employment to the employer for whom the claimant worked. On the contrary we think its language necessarily embraces employees of the same class working for other employers in the same place or in a neighboring place, and if any such employees worked substantially the whole of such year their wages would control the weekly wage of the appellee. On this issue as to other employees working for other employers in the same place or in a neighboring place the testimony is silent. In other words the testimony does not show that the Phillips Petroleum Company was the only employer in the vicinity engaged in the refinery business. It does not show that there were no such refineries in some neighboring place, nor does it show that there were no employees of the same class in the employment of some .other employer in the same or a neighboring place who had or had not worked substantially the whole of such year. In such a state of the record the appellee did not discharge the burden placed upon him to show by competent evidence that it was impracticable to compute his weekly wage under first subdivision 2 and, therefore, his resort to first subdivision 3 under such circumstances was unwarranted. Since the recovery was based upon a weekly wage in excess of the minimum allowed by law we think the court committed reversible errer in submitting the weekly wage rate under first subdivision 3 and awarding compensation upon the jury’s finding thereon.

The appellant assigns as error the court’s action in overruling its objections to special issue No. 2 to the effect that the issue directs the jury’s consideration of the appellee’s first amended petition wherein there were allegations as to the injuries received by the appellee which have no support in the testimony. Special issue No. 2, was as follows: “Do you find from a preponderance of the evidence that such injury inquired about in Question No. 1, if any you have found he did sustain, was sustained by Harry J. Ebers in the manner and way as is alleged in plaintiff’s first amended original petition? Answer ‘yes’ or ‘no’.”

It is our opinion that this is one instance where such reference to the pleadings as is evidenced by the above issue constitutes reversible error. Without entering a detailed discussion of the matter we think it sufficient to state that from a careful analysis of the allegations of the appellee and comparing such allegations with the testimony, it is evident that several important phases of the allegations as to the “manner and way” the appellee sustained his purported injuries were without support in the testimony. Under such conditions it is error to refer to the pleadings and is never good practice under any circumstances. Texas Employers’ Ins. Ass’n v. Burnett, Tex.Civ.App., 72 S.W.2d 952; Traders & General Ins. Co. v. Weatherford, Tex.Civ.App., 124 S.W.2d 423

The appellant also complains of the court’s action in overruling its objections to special issue No. 16. Said issue and the court’s directions as to how it should be answered are as follows: • “What per cent of disability, if any suffered by Harry J. Ebers, do you find from a preponderance of the evidence would have resulted from the injury of September 9, 1937, had there been no prior injury of February, 1937? Answer by giving per cent, using 100% as basis.”

To this issue the jury answered “100%”. This issue was not conditioned upon the answer to any prior issue. The appellant objected to the issue on the ground that it was on the weight of the testimony; that it assumed and suggested to the jury that the appellee had sustained an injury on September 9, 1937, upon which he predicated his suit; and that the instructions of the court as to the manner the jury should answer the issue assumed and suggested to the jury that some percentage of disability had resulted from the September injury. Under the facts of this case we think the objections of the appellant were well taken. It was uncontroverted that the appellee had received an injury in February, 1937, for which he had received compensation. This February injury was not the subject of this litigation except in so far as it might defeat the claim of the appellee for injuries alleged to have been received by him in September, 1937. Whether or not the appellee sustained an injury on September 9, 1937, as claimed by him, was a closely contested issue upon the trial of this case. It was contested both as to whether or not the transaction occurred as described by the appellee in which he. claimed to have fallen on the concrete floor, and as to whether or not. from this purported fall, or otherwise, the appellee sustained the purported fractured condition of his spine as claimed by him. We therefore sustain this assignment. Texas Employers’ Ins. Ass’n v. Van Pelt, Tex.Civ.App., 83 S.W.2d 392; Cannady et al. v. Martin et al., Tex.Civ.App., 69 S.W.2d 434; Texas Power & Light Co. v. Culwell et al., Tex.Com.App., 34 S.W.2d 820; Gordon et ux. v. McIntosh et ux., Tex.Civ.App., 54 S.W.2d 177; City of Amarillo v. Rust, Tex.Civ.App., 45 S.W.2d 285; Chicago, R. I. & G. R. Co. v. Hammond, Tex.Civ.App., 286 S.W. 483.

In view of another trial of this case we wish to discuss briefly some of the other assignments of the appellant. One assignment is with reference to the admission of the deposition testimony of Dr. J. R. Maxfield. This witness gave testimony to the effect that he examined the appellee on June 7th and 8th, 1938; that the appellee complained of severe pain and soreness in the lumbar portion of the spine; that the appellee was suffering from pain; and that he was unable to relax, rest or sleep at night without medicine. The appellant objected to this testimony on the ground that it was based in part upon hear-say and self-serving declarations. It has been held that such testimony is not'admissible if the physician made his examination of the patient for the purpose only of testifying as a witness for him. Federal Underwriters Exchange v. Arnold, Tex.Civ.App., 127 S.W.2d 972; Gaines v. Stewart, Tex.Civ.App., 57 S.W.2d 207, and authorities there cited. A different rule applies, however, if the physician seeks and obtains such information from the patient for the purpose of treatment and when the answers were given by the patient while the physician was examining him for such treatment. St. Louis Southwestern Ry. Co. of Texas v. Burke et al., 36 Tex.Civ.App. 222, 81 S.W. 774, writ refused; Missouri, K. & T. Ry. Co. v. Rose 19 Tex.Civ.App. 470, 49 S.W. 133, writ denied. In the instant case Dr. Max-field testified that he made his examination of the appellee for the purpose of treating him and that he recommended treatment for him. Furthermore, the physician testified that his opinion as to the physical condition of the appellee was not based upon subjective symptoms but solely upon objective symptoms obtained by him in the course of his examination. Under these circumstances it is our opinion that the court’s action, in overruling appellant’s objection t® this testimony was not reversible error.

The appellant presents as error the court’s refusal to submit its specially requested issue No. 5, as follows: “Do you from the preponderance of the evidence find plaintiff’s total incapacity, if any, not to have terminated?”

The court in his main charge submitted special issue No. 9, which is as follows:

“How long do you find,- from a preponderance of the evidence that the total incapacity, if any, of plaintiff, Harry J. Ebers continued or will continue from the date of said injury, if any, was sustained on or about the 9th day of September, 1937? Answer by giving the length of time, if any.”

To this issue the jury answered “151 weeks”. By such answer the jury found that the total incapacity of the appellee had not terminated at the date of the trial in 1938, but extended beyond such date into the year 1940. While we recognize the rule that the defendant is entitled to an affirmative submission of all of its defensive issues raised by the pleadings and evidence, it is our opinion that the substance of the requested issue in controversy was not an affirmative defense but a mere negation of the appellee’s cause of action as to the duration of his total incapacity. We think the complaint of the' appellant in regard to the court’s refusal to submit special issue No. 5 is expressly overruled by the holding of this court in Texas Indemnity Ins. Co. v. Perdue, Tex.Civ.App., 64 S.W.2d 386, 388, writ refused, in the following language: “In a case that permits the defendant to prove an affirmative defense under a general denial and the testimony raises such affirmative defense, the defendant is entitled to an affirmative submission of the defense so raised, but, if the evidence offered tends only to negative the cause of action presented, the issue or issues on which such action depends should be submitted affirmatively as plaintiff has the burden of proof, but the negation of such issue should not be affirmatively submitted. Texas Employers’ Ins. Ass’n v. White, (Tex.Civ.App.) 32 S.W.2d 955.”

We therefore overrule this assignment. Gulf States Security Life Ins. Co. v. Edwards, Tex.Civ.App., 109 S.W.2d 1125, writ dismissed; Hoover v. Hamilton, Tex.Civ.App., 14 S.W.2d 935, writ refused; Jefferson Standard Life Ins. Co. v. Curfman, Tex.Civ.App., 127 S.W.2d 567, writ dismissed, and authorities therein cited.

Complaint was also made of the pleading and testimony of- the appellee as to his loss of sexual power. Both the pleadings and the testimony on this issue attributed such loss to the injury to ap-pellee’s back, spine and other organs of his body. Under such circumstances, notwithstanding such loss is not a compensable injury under the Texas Compensation Law, it is our opinion that it was competent for the appellee to plead and prove such fact for whatever it was worth to the jury in determining the extent of the injuries to appellee’s back, spine and internal organs.

The appellant requested two issues duplicating the same thought inquiring of the jury whether the appellee’s incapacity, if any, was not the result of something other than an accidental injury, if any, sustained by the appellee on September 9, 1937. The trial court refused to submit either of such issues. It is our opinion that such action of the court was not error by reason of the fact that the court submitted substantially the same defensive matter in his main charge in special issue No. 18, to-wit: “Do you find from a preponderance of the evidence that the incapacity of plaintiff, if any, is not due solely to some bodily condition having inception antedating September 9, 1937? Answer ‘it is’ or ‘it is not’.”

It will be noted in this special issue that the bodily condition inquired about is one having its inception antedating September 9, 1937, the date of the injury herein sued upon. Since the testimony in the present record does not intimate any injury or bodily condition having its inception after September 9, 1937, we think issue No. 18 adequately presented this defense of the appellant, however, upon another trial such might not be the case. If the testimony raised the issue as to some bodily condition having its inception after September 9, 1937, as well as prior thereto, appellant’s requested special issue No. 7 would more adequately present its defense. Such requested issue was as follows:

“Do you from the preponderance of the evidence find plaintiff’s present condition, if any not the result of something other than an accidental injury, if any, sustained on September 9, 1937?
“Answer Yes or No.”

In view of the disposition of this appeal we deem it unnecessary to discuss appellant’s other assignments which likely will not arise upon another trial.

The judgment is reversed and the cause remanded.


author: FOLLEY, Justice..

text:
    BIGGS v. POLING et al.
    No. 5072.
    Court of Civil Appeals of Texas. Amarillo.
    Nov. 6, 1939.
    Rehearing Denied Dee. 18, 1939.

      H. H. Cooper, of Amarillo, for appellant.
    Adkins, Pipkin, Madden & Keffer, Wm. L. Darrah, and Shannon, Ochsner & Little, all of Amarillo, for appellees. •
   FOLLEY, Justice..

This suit is resolved into a controversy as to the effect of a royalty deed executed by E. S. Poling on July 20, 1925 in favor of J. A. Wyrick. E. S. Poling died December 24, 1928 leaving a will devising to his widow and children all of the land hereinafter mentioned. E. R. Biggs, the appellant herein and successor in interest to Wyrick in the deed mentioned, filed this suit on June 13, 1938 in the District. Court of Carson County, Texas. The E. S. Poling devisees and legal representatives were made parties defendant. The Navajo Oil Company, the Canadian River Gas Company, the Parcomis Oil and Gas Company, other holders of leases and many persons holding small royalty interests, which we deem unnecessary to mention, were also made parties defendant. Such trial court defendants are appellees in this court.

The suit was in the nature of an action in trespass to try title. It was to recover 1BS%72 of ⅛ of the minerals, or 158⅞072 of the non-participating royalty' interest in some four and one-half sections of land in-Carson County, Texas. The evidence' is un-controverted that E. S. Poling held the fee simple title to the four and one-half sections of land and that beginning in July, 1925 he sold some of the royalty interest in the minerals in these lands. These sales-were made on the basis of so many “units”, a unit being ½53« of Vie of the minerals, The instruments by which such units were-conveyed reserved to the grantor, E. S. Poling, all right to make and control leases, to collect and retain bonuses and rental payments, and thus the royalty interests, conveyed were non-participating in so far as the lease money and rentals were concerned. The royalty deeds conveyed only an undivided interest in and to all the oil, gas or other minerals that should be produced and removed from the lands. No-issue was raised as to the nature of the royalty interests conveyed by these various conveyances in so far as they were non-participating, and no issue presented as to whether the Vie referred to meant so many units in Vie of the minerals in place, it being assumed that Vie was one-half of the royalty.

The evidence showed that E. S. Poling was offering for sale one-half of his royalty in small units of ¾536 of Vie at the rate of $100 per unit. One J. A. Waybourn, now deceased, was employed as broker to sell these units and it was largely through his efforts that the royalty was sold not only to Wyrick but to all others who purchased. On July 1, 1925, Waybourn as salesman and presumably the agent of E. S.Poling, entered into a written contract with J. A. Wyrick to convey to the latter two units of the minerals or an undivided ¾536 of an undivided Vie interest for $200. In pursuance to this agreement the deed of July 20, 1925 from E. S. Poling to J. A. Wyrick was executed. Printed forms had been prepared and were used in this transfer and in all the other sales of such royalty interest, such forms having blank spaces in which to fill in the number of units conveyed by such instruments. We here quote such portions of the deed in question as we deem germane to the present controversy :

“That I, E. S. Poling, residing in the County of Potter and State of Texas, for and iri consideration of the sum of $200/00 Dollars cash to in hand paid by J. A. Wy-rick, have bargained and sold, and by these presents do grant, bargain, sell, convey and deliver unto the said J. A. Wyrick, of the County of Childress and State of Texas, an undivided 1536 Fifteen Hundred Thirty-sixth ( -1536) interest in and to an undivided One-Sixteenths (1-16) interest in and to all the oil, gas and mineral substances, in and under the surface of that certain parcel of land situated and being in Carson County, Texas, and particularly described as Sections Numbers 22, 24, 26, 27 and the East One-half of Section Number 12, all in Block Y-2, Carson County, Texas, containing 2560 acres more or less.
“To have and to hold, all and singular, such minerals and mineral rights, unto him, the said J. A. Wyrick, his heirs and assigns, forever, subject, however, to all existing and valid leases thereon, it being intended and purposed hereby that the said grantee is to have the right to have the above described interest if taken out under existing or subsequent lease contracts, the equal-1536 of 1-16 royalty or that portion of the oil, gas, or minerals, or proceeds from same, taken from said land, which right inures to the benefit of him and his assigns forever.'’

It is apparent from an examination of' the above deed that there are two blank spaces which were not filled in at all and that the first “1536” appearing above was inserted before the words “Fifteen Hundred Thirty-sixth” instead of the figure “2” or the word “two” as agreed upon, which purportedly was 1534 more units than called for in the contract. These 1534 units form the basis of the present controversy.

Numerous other conveyances were made thereafter of various units of this royalty. On November 20, 1925 E. S. Poling conveyed five additional units to J. A. Wyrick for $500, about which transaction no question is raised. On September 5, 1925 the appellant himself contracted to purchase fifty units of this royalty but the deed in connection therewith was not delivered until after the death of E. S. Poling. This contract recited a cash consideration of $500 and the’ execution of a note by Biggs in the sum of $4500, making a total of $5000 for the fifty units. The testimony shows that Biggs paid only $1200 to Poling on this contract and further shows that Poling requested his legal representatives before his death to deed Biggs twelve units of the royalty in satisfaction of the $1200 paid by him. The independent executors of the Poling Estate by an instrument of the date of May 27, 1930 deeded these twelve units to Biggs and such deed recited that the conveyance was in satisfaction of the royalty contract made during the lifetime of E. S. Poling.

In addition to the twelve units he acquired under the 1925 contract with Poling^ in 1938 the appellant purchased thirty-four other units from grantees of Poling other than Wyrick. Twenty-eight of these thirty-four units were purchased in January, 1938 and the other six in June, 1938. By his own testimony Biggs admitted that he purchased these thirty-four units at about 10% of their original value. On February 24, 1938 Biggs purchased from J. A. Wyrick all the right, title and interest that the latter held in the royalty of such land by virtue of the deed to Wy-rick from Poling of the date of July 20, 1925 purporting to convey the units in controversy and by virtue of the deed between the same parties of the date November 20, 1925 conveying the five units not in dispute. The consideration paid to Wyrick by Biggs in this transaction was shown to have been $304.

Under the above facts it is conceded by the appellees that the appellant owns fifty-three units of the royalty in question, fifty-one of which having been acquired by him in deeds and assignments regular in every respect, and the other two units the appellees admit were passed to the appellant under the deed of July 20, 1925 upon his acquisition of the rights of Wyrick therein. The real controversy in the case narrows down to the conveyance from E. S. Poling to J. A. Wyrick purporting to convey “1536 Fifteen Hundred Thirty-sixth” interest in and to an undivided ¾6 interest in the minerals of the land. Biggs, who claims through Wyrick, asserted that such deed passed a full ¾6 (one-half) of the royalty and that having acquired Wy-rick’ s interest on February 24, 1938 he was the owner of one-half of the royalty in the land plus fifty-one units, or lss%072 of ⅛ of the royalty.

The evidence shows that the instrument of July 20, 1925 was not recorded until after E. S. Poling’s death, it having been filed for record February 13, 1929. J. Á. Wyrick testified that he kept the deed in a tin can in his dugout in Childress County until he heard that E. S. Poling’s will was being probated, whereupon he sent the deed to Carson County to be recorded. J. A. Wyrick further testified that in the deed of July 20, 1925 he understood that he was buying only two units for the $200 paid therefor and that he did not know that such deed purported to convey to him more than two units until after he had sold what he thought was seven units to E. R. Biggs in February, 1938. Wyrick never at any time made any claim to more than two units under the deed of July 20, 1925.

Production of gas was begun on the land in 1928 under leases held by various com-' panies. At the time Biggs acquired Wy-rick’s title in 1938 it was shown that the 1534 units of the royalty now claimed by Biggs would have been worth about $24,000 in accrued royalties or moneys for gas that had been produced and never paid to Wyrick, which necessarily would have been due to the appellant if he should prevail in this suit. In addition to such amount the mineral interest yet to be produced exceeded in fair market value $30,000, nevertheless, the appellant purchased such purported interest for $304 from one who thought he owned only a nominal portion of the royalty, to-wit, seven units, five of which he obtained by the deed of November 20, 1925, and the other two by the deed in question. The testimony further shows that Biggs discovered the apparent error in the deed by a detailed examination of the deed records of Carson County shortly before his purchase from Wyrick, but that he did not reveal such discovery to Wyrick. Moreover, a fair analysis of his testimony would warrant no other conclusion than that he knew Wyrick was under the impression that the latter owned only seven units and that such was the amount Wyrick thought he was selling to Biggs in February, 1938. In this connection it should be stated that Wyrick is not a party to this suit. However, by his testimony he made no claim under the deed of July 20, 1925 other than to the two units he contracted to purchase.

As a defense to appellant’s claim the appellees alleged that if the deed in question conveyed any interest to Wyrick other than the two units such fact was unintentional and due to a mutual mistake on the part of E. S. Poling, J. A. Wyrick and the scrivener who drew the instrument; that in the alternative if the mistake was only upon the part of E. S. Poling that the same constituted a fraud upon the part of J. A. Wyrick; that if Wyrick had knowledge of the mistake he accepted the instrument without calling attention to the mistake and at all times fraudulently concealed the same; that E. S. Poling never discovered the mistake during his lifetime and that his failure to discover such mistake was not due to any negligence on his-part; that the representatives of the Poling Estate, as well as the devisees under the Poling will, did not, and could not, in the exercise of reasonable diligence, discover the same; 'that although production was begun on the land as early as 1928 and continued thereafter in increasing amounts, and although appellees at all times claimed and collected the royalties accumulating on the additional royalty interest claimed by Biggs, and asserted ownership to such-mineral interest, J. A. Wyrick at no time ever asserted any claim that he had any character of interest in said royalty by reason of the conveyance in question other than the two units which appellees admitted’ were thereby conveyed; that the first demand of any sort made upon the appelleestor a greater interest under said deed than two -units was the filing of the suit by Biggs in June, 1938; that the lessees of the-Polings of the mineral interests were producing gas under their respective leases; that all times since June 5, 1923, the date of the first mineral lease, the possession of the land in question had been in the Polings and the oil and gas companies who were developing and producing the gas, and that said parties occupied and used the same and paid the taxes thereon; that E. S-Poling during his lifetime, and the appel-lees after his death, received and appropriated to their own use all rents, revenues, and royalties accruing from the 1534 units now in controversy; that the instrument of February 24, 1938 conveying the interest of Wyrick to the appellant was only a quitclaim deed and therefore conveyed to Biggs only the interest that Wyrick possessed, which was Vime of ½6; and that because of this and the further fact that the appellant had knowledge of the mistake and paid a grossly inadequate consideration for the purported 1534 units, Biggs could not have been an innocent purchaser.

The appellant filed a supplemental petition in which he pleaded the four year statute of limitation as a bar to the reformation of the instrument of July 20, 1925. In this connection it should be stated that the appellees pleaded the facts above stated ás a defense to the appellant’s right to recover and further asked for all relief, general and special in law and equity, to which they were entitled. Under such pleadings we think the issues hereinafter discussed were joined by the pleadings of all the parties.

The case was submitted to a jury upon special issues the answers to which in effect found upon sufficient testimony that E. S. Poling and J. A. Wyrick both intended that only two units should pass under the deed of July 20, 1925; that Biggs had notice of the mistake in the deed; that the market value of such ½6 royalty plus ¾536 of the remaining Vie of the minerals alleged by Biggs to have been acquired by him from Wyrick was $25,000 on, the date of the transfer to the appellant; that on such date $22,782.61 hald accumulated from the mineral interest that Biggs alleged he acquired from Wyrick; that on such date the appellant was acquainted with the approximate value of the mineral interest and the amount of royalty money that had accrued from the interest he alleged to have acquired from Wyrick; and that E. S. Poling and his devisees and legal representatives -failed to discover the mistake in the deed, none of whom had knowledge of any facts or circumstances which were sufficient to have caused a reasonably prudent person to make inquiry which if pursued with reasonable diligence would have led to the discovery of the mistake prior to the filing of appellant’s suit. Upon this verdict the court rendered judgment for the several appellees other than the Polings for the specific interest they were shown to have owned and about which there is no dispute. This judgment also awarded to the appellant 6¾536 of an undivided Vie interest in and to the oil, gas and minerals in the land, denied the appellant any recovery for more than two units under his claim by virtue of the deed of July 20, 1925 from Poling to Wyrick, and decreed in the Poling devisees all other royalty interests in the land not otherwise awarded as above set out. The recovery of Biggs and of the Poling devisees was made subject to the terms and provisions of all the outstanding oil and gas leases and no complaint is made of this portion of the judgment.

There is no issue in this case with respect to the gas and oil companies. They disclaimed ownership to the minerals in dispute between the Polings and the appellant and asserted no ownership other than such as was acquired under their respective leases about which there is no controversy. They appear in this suit chiefly in the role of stakeholders and due to our disposition of this case they shall not be further noticed.

We think it is evident from the record that the appellant does not maintain the position of an innocent purchaser for value. Aside from the palpable inadequacy of the consideration paid by him for the purported royalty, and his knowledge of the mistake in the deed of July 20, 1925, the assignment from J. A. Wyrick to E. R. Biggs of the date of February 24, 1938 constituted no more than a quitclaim of whatever interest Wyrick had in the royalty. We shall not prolong this opinion by quoting from such 'instrument but deem it sufficient to state that Wyrick granted, bargained, sold, etc., to E. R. Biggs all of his right, title, interest and estate into an undivided interest in the oil, gas and minerals under the land situated in Carson County theretofore conveyed to Wyrick by the deeds above mentioned. This conveyance was almost identical with the one in issue in the case of Houston Oil Company of Texas et al. v. Niles et al., Tex.Com.App., 255 S.W. 604, 610. In such case the Commission of Appeals, with the approval of the Supreme Court of Texas, held that such instrument was a mere quitclaim and further held, in line with numerous decisions therein cited, that the holder under such an instrument was prevented from asserting the defense of innocent purchaser “as against an outstanding title or secret trust or equity existing at the time the quitclaim deed was executed”.

As we view this case there is but one issue in it and that is whether or not under the record presented the four year statute of limitations asserted by the appellant is a bar to the recovery of the appellees. From the above recitations it is very evident that the equities in the case are resolved against the appellant both by the facts introduced and by the verdict of the jury. Regardless of this situation the appellant stands in this court in the attitude of Shylock of Shakespearean fiction demanding his “pound of • flesh”.

Under the facts of this case we think it is conclusive that the equitable title to the 1534 units of royalty never passed to J. A. Wyrick by the deed of July 20, 1925, and that Wyrick received at most only the legal title ,to such units by mistake .in the deed which legal title was not paid for by him and which he held at all times prior to February 24, 1938 in trust for Poling and his devisees and legal representatives. Wyrick never at any time during such period made any claim to such interest which was for all purposes in the possession of Poling and his successors. Wyrick at all times recognized the equities of E. S. Poling and his devisees. Whether he knew of the mistake in the deed or not his acquisition- of the legal title was wrongful and constituted at least constructive fraud, and therefore created a constructive trust in favor of those for whom he held the legal title. In Bogert’s Trust and Trustees, Vol. 4, page 2768, § 953, it is said: “If, after the wrongful acquisition or withholding of property which could be made the basis for a constructive trust, the acquirer or holder recognizes the equity of the wronged party and in substance asserts that he holds legal title in trust for the injured person, the authorities agree that the statute of limitations does not operate against the cestui. Such conduct amounts to the declaration of an express trust; and it should take a subsequent repudiation of such express trust to set the statute running.”

It has been held by the Supreme Court of this State that in a trespass to try title action the superior title which will enable a party to prevail in the suit may be either legal or equitable. The case of Gilmore et al. v. O’Neil, 107 Tex. 18, 173 S.W. 203, is one instance in which our Supreme Court has announced such a rule in a situation very similar to that existing in the instant case. In fact, we think that case is directly in point in many respects with the instant case and is decisive of all the material issues in this case. In the Gilmore case Jones and wife in 1903 intended to convey to Mrs. Duey 1% acres of land but instead conveyed by deed only 1.35 acres, thereby omitting by mistake about ½ of an acre from the conveyance. Jones caused 1⅜ acres to be surveyed and set apart as the tract conveyed to Mrs. Duey and at all times thereafter to the time of his death recognized and treated it as such. Mrs. Jones on January 8, 1908, after the death of her husband,' executed an oil lease on her land to Gilmore and others which purportedly included the ⅛ acre that was omitted by mistake in the deed to Mrs. Duey. On August 1, 1908 Mrs. Duey conveyed an undivided one-half interest in her tract to Kuhn, and on July 29, 1908 Kuhn acting for himself and as attorney in fact for Mrs. Duey executed an oil lease to Donahue, who on August 1, 1908, assigned the lease to O’Neil. Thereafter on September 17, 1908 O’Neil acquired the interest of Mrs. Duey and Kuhn in a deed describing the land conveyed as 1.662 acres. Oil was produced in considerable proportions from a well situated on this ⅛ acre in dispute. Gilmore and his co-plaintiffs on September 30, 1908 filed a suit in trespass against O’Neil and the Texas Company, a stakeholder, for title and possession of the ⅛ acre of land and $29,563.25 proceeds of the oil well. At such time O’Neil was in possession holding under his lease and deed. At the time this suit was filed' the deed from Jones and wife containing the mistake was five years and two days old and the plaintiffs in that suit interposed the four year statute of limitation as a bar to O’Neil’s recovery. In that case Gilmore and the other plaintiffs were in the same position as the appellant Biggs herein. They held the legal title to the land and the defendant O’Neil held the equitable title in comparison to that held by the appellees in the instant case. In such case the Supreme Court, 107 Tex. 18, 173 S.W. 203, 206, in the course of an opinion written by the late Justice Phillips said:

"It will simplify the entire case to first determine where lies the superior title to the land. This does not mean the legal title, but the superior title, whether legal or equitable, since an equitable title may be superior to the legal title, and will prevail over the legal title if capable of being enforced against it.
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“O’Neil’s pleading recited the facts, substantially as we have stated them, and as the jury found them, the effect of which was to invest him with a superior equitable title to the land, and reveals that, upon such a title and notice of the equity by the plaintiffs in the acquisition of their rights, his defense to their suit was rested. His prayer for the removal of the cloud upon his title, cast by the claims of the plaintiffs and interveners, did not alter the character of his defense, or convert it into an affirmative action subject to limitation. If his was the .superior title and capable of enforcement against the legal title, his right to be quieted in it would follow. Asserting, as he was, a superior equitable title, independent of the deed of Jones and wife to Mrs. Duey, as the basis of his defense, in what way was the reformation of that deed essential to the establishment of his defense? With no possession adverse to his right, how could limitation affect his right? It is not the law, and could not well be the law, that, in a trespass to try title action, proof of an equitable title by a defendant in possession is subject to limitation. What was said by Judge Wheeler in Newsom v. Davis, 20 Tex. 419, concerning the rights of a defendant in possession of land under a bond for title, having paid the consideration — one no more favorably circumstanced than a defendant in possession under such a sale as is shown to have been made by Jones to Mrs. Duey, with the full consideration paid, followed by valuable improvements in good faith — may be here aptly quoted:
“ ‘The defendant being in possession under a contract to convey, and having paid the consideration, is the equitable owner of the land. His is superior to the legal title remaining in his vendor; and, there being no possession adverse to his right, the statute of limitations does not run against it. Vardeman v. Lawson, 17 Tex. 10.’
“It was announced in Rutherford v. Carr, 99 Tex. 101, 87 S.W. 815:
“ ‘There is no statute of limitation which prescribes a bar to the proof of a fact material to sustain or defeat a cause of action or defense; such statutes act upon the cause of action.’
⅜ ⅜ ⅜ * ⅜ ⅛
“Under the findings of the jury upon the issues of fact, it is our opinion that O’Neil was entitled to recover the land and the proceeds of the oil. This, it seems to us from an examination of the record, accords with the justice and right of the case; and that is what the law of a case ought to be.”

There is another case which we think is of great importance in the disposition of the instant case. Such case is that of Terry et al. v. Baskin et al., Tex.Com.App., 44 S.W.2d 929, 78 A.L.R. 1067. In such suit J. M. Terry owned 200 acres of land in Milam County, Texas. He was twice married and had two sets of children. In 1915 after the death of Terry the first set of children employed the law firm of Morrison & Lewis to recover for them their interést in the land and made a contract which was, in effect, a deed conveying to such attorneys an undivided one-half interest in the land to be recovered. Such instrument was duly acknowledged and recorded in the deed records of Milam County. That same year these attorneys filed suit and recovered the land in a judgment which recognized the homestead rights of the second wife of Terry. This second wife occupied the land until her death in 1927 and the heirs occupied the land thereafter. In December, 1928 the attorneys filed a partition suit against the heirs of Terry. The children of Terry who thirteen years before had executed the conveyance to Morrison & Lewis pleaded that such conveyance was procured by fraud. By special exceptions Morrison & Lewis replied setting up a plea of limitations as a bar to setting aside the conveyance in question by reason of the alleged fraud. The trial court sustained these exceptions and rendered judgment for the attorneys. The Court of Civil Appeals affirmed the judgment, 27 S.W.2d 857, and held that the title of Morrison & Lewis could only be avoided by a suit brought by the defendants to cancel the instrument of August 7, 1915 before they could recover the land, and that the allegations of fraud set up by them constituted an action for affirmative relief. In an opinion approved by the Supreme Court, 44 S.W.2d 929, 931, 78 A.L.R. 1067, Judge Critz, speaking for the Commission of Appeals, said:

“We think the Court of Civil Appeals is in error in the above holding, and further is in error in holding that the issues of limitation involved in the present suit are determined by the rule announced in Deaton v. Rush, supra [113 Tex. 176, 252 S.W. 1025]. In that case the grantor was attempting to recover from his grantee in possession by virtue of the grant, and it was very correctly held that a vendor having an equitable right to rescind and cancel a conveyance for fraud could not maintain a suit for the recovery of the land from his vendee in possession without the cancellation of the deed, though he may have judgment for such cancellation, and, as an incident thereto, for the recovery of the land in the same suit. Of course, in such a case, if the right to cancel the conveyance is barred by limitation, no recovery of the land can be had; this for the simple reason that it is absolutely necessary to cancel the conveyance before the land can be recovered.
“As disclosed by the pleadings, we are confronted with very different conditions in the instant case from the conditions in Deaton v. Rush. In the instant case, the defendants are in possession of the land, and the plaintiffs, Morrison & Lewis, are seeking to oust them of such possession by means of a suit for partition and sale through a receiver. Morrison & Lewis in effect pleaded the power of attorney and conveyance to them as the basis of their asserted rights. Defendants pleaded as a defense to the right of Morrison & Lewis to recover that such power of attorney and conveyance was . procured by fraud, and is therefore void. In this condition of the record, no statute of limitation bars the defense. Newsom v. Davis, 20 Tex. 419; Rutherford v. Carr, 99 Tex. 101, 87 S.W. 815, 817; Gilmore v. O’Neil, 107 Tex. 18, 173 S.W. 203, 207; Mason v. Peterson (Tex.Civ.App.) 232 S.W. 567; Id. (Tex.Com.App.) 250 S.W. 142 (opinion approved); Texas Co. v. Davis, 113 Tex. 321, 254 S.W. 304, 309, 255 S.W. 601.
:|c * * * * *
“In Mason, v. Peterson, supra, which is expressly approved by the Supreme Court, the Commission of Appeals, speaking through Judge McClendon, expressly held that fraud or mistake enters into and vitiates a contract for the sale and purchase of real estate to the extent of the resultant injury, and is a defense available to .the purchaser in a suit on his obligation, and, where he seeks relief only by way of defense to defeat in whole or in part the obligation for the purchase, his defense is not affected by the statute of limitation.
* * * * * *
“From what we have said it is evident that we hold that the defendants’ special answer of fraud alleges a defense to the cause of action asserted by the plaintiffs Morrison & Lewis, and that such defense is not barred by any statute of limitation.”

In view of the above authorities it is our opinion that the statute of limitations urged by the appellant herein was not a bar to the defense asserted by the appellees and it is our further opinion that the equitable title of the devisees and legal representatives of E. S. Poling to the 1534 royalty units in controversy was shown to be superior to the legal title of the appellant, and therefore the appellees are entitled to prevail. Rutherford et al. v. Carr, 99 Tex. 101, 87 S.W. 815; Luginbyhl et al. v. Thompson, Tex.Civ.App., 11 S.W.2d 380, writ dismissed; Mason v. Peterson et al., Tex.Com.App., 250 S.W. 142; Texas Co. et al. v. Davis et al. 113 Tex. 321, 254 S.W. 304; Emerson v. Navarro et al., 31 Tex. 334, 335, 98 Am.Dec. 534; Pinkham v. Pinkham et al., 60 Neb. 600, 83 N.W. 837; Id. 61 Neb. 336, 85 N.W. 285; Eastern Gulf Oil Co. et al. v. Lovelace et al., 188 Ky. 238, 221 S.W. 544. What we have said we think disposes of the real issue in this case and after such disposition all other issues raised by the appellant become immaterial.

The judgment is affirmed.