author: HUFF, O. J.

text:
    CHICAGO, R. I. & G. RY. CO. v. CORE.
    (No. 749.)
    (Court of Civil Appeals of Texas. Amarillo.
    March 27, 1915.
    Rehearing Denied May 1, 1915.)
    1. Evidence &wkey;>474% — Opinion Evidence-Question op Law and Pact.
    In an action for injuries to live stock in shipment, testimony by the shipper as to the ordinary shrinkage of cattle under proper shipment, if they were properly handled, is not an opinion on a mixed question of law and fact, since the expressions “proper shipment” and “properly handled” do not refer to the condition of the cattle under the shipment in question, but to the usual and ordinary shrinkage of cattle of that class when shipped.
    [Ed. Note. — Eor other cases, see Evidence, Cent. Dig. §§ 2220-2223; Dec. Dig. i&wkey;474y2J

    2. Appeal and Error <@=31051 — Harmless Error — Admission oe Evidence — Fact Otherwise Established.
    Error in admitting opinion evidence as to a mixed question of law and fact is harmless, where substantially the same facts were otherwise proved without objection.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 4161-4170; Dec. Dig. &wkey;> 1051.]
    3. Carriers &wkey;>218 — Carriage oe Live Stock — Liability op Carrier — Negligence.
    A carrier of live stock cannot, under the Hepburn Act (Act June 29, 1906, 34 Stat. 584), exempt itself by contract from liability for its negligence, or that of its servants, causing damage to an interstate shipment of live stock.
    [Ed. Note. — For other cases, see Carriers, Cent. Dig. §§ 674H396, 927, 928, 933-949; Dec. Dig. <&wkey;218.]
    4. Carriers &wkey;>218 — Carriage oe Live Stock — Liability oe Carrier — Higher Rate — Option oe Shipper.
    Where a carrier had published a tariff of interstate rates on shipments of live stock, which contained two rates, a higher one for shipment at the carrier’s risk, and a lower one for shipment at an agreed valuation and limitation of damages, and a shipper exercised his option by demanding the higher rate, the carrier cannot escape full liability for damages because of the fact that the agent refused to accept the shipment at the higher rate and to mark the contract accordingly, since by the exercise of the shipper’s option the contract became one at the carrier’s risk, regardless of the terms of the bill of lading, and the carrier could have collected the higher rate at destination.
    [Ed. Note. — For other cases, see Carriers, Cent. Dig. §§ 674^696, 927, 928, 933-949; Dec. Dig. <&wkey;>218.]
    Appeal from Wheeler County Court; M. M. Miller, Judge.
    Action by J. C. Core against the Chicago, Rock Island & Gulf Railway Company. Judgment for plaintiff, and defendant appeals.
    Affirmed.
    N. H. Lassiter, of Ft. Worth (Gustavus & Jackson, of Amarillo, of counsel), for appellant. H. B. Hill and M. Reynolds, both of Shamrock, for appellee.
   HUFF, O. J.

J. C. Core sued the Chicago, Rock Island & Gulf Railway Company for damages. alleged to have been occasioned in the shipment of two ears of cattle, 56 head, from Bennonine, Tex., to Kansas City, Mo., which were received for shipment August 23, 1913, alleging that the cattle were negligently delayed along the route; that they were in good condition when delivered to appellant; that the cattle were loaded in two cars at Bennonine; that those which were dehorned were loaded into one car, and those with horns in another car, which was done to prevent injury to themselves by hooking and fighting each other; that at Herrington, Kan., where the cattle were unloaded, fed, and watered, the appellant undertook and did reload the cattle, and reloaded the horned and dehorned cattle together in the cars and intermingled them; that the appellant did so over the protest of appellee, and over his request that they be reloaded as they were at the beginning of the voyage, and as a result they fought each other, etc., and when they reached Kansas City they were shrunken in flesh, bruised, skinned, crippled, and wounded; that by reason of the delay, and the intermingling of the cattle in the same cars, they were injured and damaged, so that they weighed only 49,940 pounds, when, if they had been handled without such negligent delay and intermingling them in the cars, they would have weighed at least 53,930 pounds, and that appellee was damaged thereby in the sum, of $378.50.

The appellant answered, among other things, that the shipment was made upon a written contract, the terms of which were reasonable and binding, and to the effect: (1) That the agent of the company was not anthorized to agree to any specific time, or any particular market; (2) that the cattle should be lo'hded, watered, fed, and rested at the risk and expense of appellee; (S) that as a condition precedent to a recovery for damages for loss or injury or detention or delay in the transportation, promptly upon discovery, to give notice to some officer or agent of the company before the stock were removed from the point of shipment and before intermingled with other cattle, and in any event appellant was to be served in one day with notice after the delivery, and a failure to so comply should be a bar to a recovery for such damages; (4) that for total loss from any cause payment would be made therefor on the actual cash value at the time and place of shipment, but in no case to exceed $50 for each ox or steer, $30 for each cow, and $10 for each calf, and in ease of an injury or partial loss the amount of damages claimed shall not exceed the same proportion; (5) the suit for damages should be instituted in six months from the date of the injury; (6) that the shipment was made under tariff and freight regulations filed, published, and authorized by the Interstate Commerce Commission, and under the terms of the contract the cattle were handled under regulations and limitations known as “owner’s risk,” rather than “carrier’s risk,” and were transported for a lower or reduced freight rate by virtue of such contract, which reduced rate was and is a valuable consideration therefor; (7) that the shipment was an interstate shipment; (8) that appellant was not negligent in the delay of the shipment or intermixing the cattle at Herrington, Kan.; that appellee accompanied the shipment, whose duty it was under the contract to unload the cattle, and if the cattle were reloaded at Herrington, mixed and intermingled, that it was due to appellee’s negligence; (9) that, if the cattle were damaged, it was due to their “proper vice”; (10) if there was loss, it was not due from the negligence of the appellant, but from the condition of the market for said cattle.

The appellee replied, by supplemental petition, that at the time the cattle were received for shipment he demanded and offered to pay the highest rate of freight that appellant was allowed under the law to receive, and that the cattle be transported at the “carrier’s risk,” and that appellant accepted the cattle and charged the highest rate of freight, and received and accepted the cattle to be carried at “carrier’s risk.” It is also substantially alleged that the agent refused to accept the higher rate, claiming that the rate in the bill was the only rate he could accept, and refused to recognize the option of the shipper to pay the higher rate. The jury found for the appellee damages in the sum of $378, upon which finding judgment waa i^ndered, and from which appellant brings this appeal.

There is no assignment calling in question the sufficiency of the evidence to support the verdict. We therefore take it that the appellant was negligent in delaying the shipment and keeping the cattle en route an unreasonable length of time, and was also negligent in reloading the cattle at Herrington, Kan., and in mixing the two cars of cattle, and that the cattle were proximately injured by reason of such negligence, and that the appellee suffered the damages awarded by the jury.

The first assignment of error complains at the admission of the testimony of Jake Smith, as follows:

“I am acquainted with what is the usual and necessary shrinkage on cattle of this class in making such runs as this one under proper shipment. If we had gotten there within the usual and ordinary time, these cattle, or cattle of this class, would have shrunk somewhere around 30 or 35 pounds over their full weight out of pasture, if properly handled. On account of the extra run there was 40 or 50 pounds extra shrinkage per head on these cattle.”

This witness accompanied the cattle, and is shown to have been a shipper of many years’ experience and qualified to give his opinion as to shrinkage of cattle. The evidence above quoted was explained by the witness as follows:

“I mean to say they shrunk 40 or 50 pounds per head more than they would have ordinarily and customarily shrunken if they had been carried in the usual and customary time.”

And further:

“I mean they were damaged half a dollar on what they actually weighed, and I mean to say that there was 40 or 50 pounds shrink more per head than there would have been if the cattle had been handled in the usual manner and gotten on the market in the usual and customary time. Those cattle would have weighed 40 pounds more per head than they did weigh if they had reached Kansas City market in the usual and customary time, and had they been handled in the usual and customary manner.”

The terms “proper shipment” and “properly handled,” testified to by the witness, do not refer to the condition of the cattle under the shipment in question, but refer to the usual and ordinary shrinkage of all cattle of that class when shipped. His testimony amounts to the statement that the cattle shrunk from 70 to 85 pounds in this shipment and that the necessary shrinkage was 30 or 35 pounds. As the'testimony was given, we do not think it was an opinion upon a mixed question of law and fact; if, however, this were true, substantially the same facts were proven without objection.

The second assignment is overruled. We do not believe the charge subject to the criticism urged in the assignment. There was no exception made in the court below that the charge did not confine the jury to the negligence pleaded by appellee; but, had the exception been urged, we do not believe the charge susceptible <?i the interpretation given by appellant, and, further, the jury did not find for the appellee under this charge as shown by their verdict. They expressly find under paragraph 5 of the court’s charge.

The third assignment presents the serious issue in this case: The trial court instructed the jury that the shipment was an interstate shipment, made under the tariff and freight regulations of the Interstate Commerce Commission, which provides for two distinct rates, one denominated “shipper’s risk,” and one “carrier’s risk,” and said tariff provides that shippers of live stock shall be given their option between the rates, and, further, if the jury found from the evidence that, before signing the contract of shipment, appellee demanded of the appellant’s agent at the station from which the shipment originated the opportunity to pay the higher rate for the transportation, and thereby became entitled to the privilege and terms of a carrier’s risk contract, and the agent refused and denied him the benefit, and refused to execute the same at said higher rate, and declined to accept the cattle unless the contract in evidence was signed by the shipper, then they were instructed the contract would be without consideration, and its terms not binding on appellee, and if they should find that he was not bound by the contract, and found the other necessary facts, to find for appellee the damages actually sustained.

The jury, by their verdict, found under the charge and so stated therein. The contract of shipment in evidence stipulates that appellant will transport for appellee the live stock, “one car [there was a bill for each of the two cars in the same terms], said to contain -head of clean, native cattle, from Bennonine, Tex., to Kansas City, Mo., consigned to Campbell & Ross, at the rate of 29 cents per cwt., from Bennonine, Tex., to Kansas City, Mo., subject to the minimum weight and length of ears specified and provided for in tariff, said rate being less than the rate charged for shipments transported at carrier’s risk, for which reduced rate and other considerations it is mutually agreed between the parties hereto as follows.” Then follows the provision set out in appellant’s answer, and under the seventeenth paragraph it is stated that in making the contract the owner of the stock acknowledges that he has had the option of making the shipment under the tariff rates, either at carrier’s risk or upon a limited liability, and that he has selected the rate and liability named herein, and especially agrees to all the stipulations and conditions named. The evidence shows there were several 'separate shippers with cars in that train, and after the cattle were loaded, and before the contract was signed, Mr. Jake Smith, who was an experienced shipper, called the attention of appellee and the other shippers to the provision in the contract giving them the option of rates. The shippers decided they wanted the higher rate, and the appellee states he wanted to ship under that rate, because he considered it cheap insurance. They selected Mr. Smith to act as spokesman for all of them, and he called the agent’s attention to clause 17 of the contract and demanded the higher rate. The agent said he could not give it, for there was no such rate. “He gave us a flat rate of 29 cents per hundred to Kansas City. He said there was no other rate than that in the office, and he did not know anything about any other rate except that one, and that was the only rate under which we could ship the cattle.” The train at that time was loaded and ready to start, and was standing at the depot when this conversation occurred, and the shippers were then waiting to sign up the contract. This witness is corroborated by two other witnesses, and in fact is not contradicted by any other.

The appellant relies alone upon the terms of the contract as drawn. Mr. R. B. O’Brien, the chief clerk of the general agent of appellant, on the witness stand identified - the tariff sheet filed by appellant with the Interstate Commerce Commission, and which was in effect at the time of the shipment. The tariff sheet is not in this record. This witness testified:

“There are two rates provided for live stock in this tariff. One is what was called the ‘lower rate,’ or what is called the ‘released rate,’ and the other is the rate that did not limit the liability of the transportation company. The released rate is 20 per cent, less than the higher rate that is provided for here in the tariff.”

On cross-examination the witness testified:

“The cost under the lower rate to ship a car of cattle from Bennonine to Kansas City would he 29 cents per hundred; under the higher rate it would be 20 per cent, more than that, or $34.80, and when the cattle are shipped under the higher rate the shipper signs the same contract, but it does not limit the liability of the company in regard, to adjusting claims. The contract is signed in the same way under the higher rate, but it is stamped with a rubber stamp showing the cattle are shipped without limitation; that is ordinarily made on the liability of the company.”

He further testified he did not know the custom of receiving cattle at Bennonine, but he did know the agent had on file both rates, and that he had no authority to dictate to the shipper the rate he should pay; that the Interstate Commerce Commission provided that railroads should charge either one of the rates, and let the shipper have the choice of which one he will pay.

The appellant presents propositions: (1) That the contract is binding, regardless of the fact that the agent may have mistakenly asserted there was only one rate, and only a contract for a carrier’s limited liability would be issued; (2) that a shipper is presumed to have knowledge of the tariff, and the rights of the parties will not be affected by the misrepresentations of the agent as to the provisions of the tariff but the tariff will be strictly enforced; (3) to set aside the provisions of tlie contract upon payment of the lower rate would be a discrimination against other shippers.

The appellant does not show by its brief or contend that there was no notice of damage given to appellant under the contract, or that the suit was not instituted within six months, or contend that it was not negligent in the shipment of the cattle, or in mixing them at Herrington, as alleged, or that there was no unreasonable delay; hence we must presume, under the strict letter of the contract, the appellant would be liable, and that the appellee has not, by failure to perform the conditions imposed upon him, forfeited his right of recovery. We do not understand, from the various decisions of the Supreme Court of the United States, that a common carrier can, under the Hepburn Act, exempt itself from its own negligence or that of its servants or agents. “The liability imposed by the statute is the liability imposed by the common law upon the common carrier, and may be limited or qualified by special contract with the shipper, provided the limitation or qualification be just and reasonable, and does not exempt from loss or responsibility due to negligence.” Railway Co. v. Harriman, 227 U. S. 657, 33 Sup. Ct. 397, 57 L. Ed. 690. It .follows, therefore, if the appellant was negligent in the particulars alleged, and if notice was given, as stipulated for in the contract, and suit was brought within the time prescribed thereby, the question presented by the court in its charge to the jury to find whether the contract was at the shipper’s or carrier’s risk is purely academic, and can have no practical bearing upon the result of the case. Whatever they may have found on that question would nevertheless have entitled appellee to judgment.

The only other question in the case is whether, under the contract limiting the amount of recovery to the damages for injury to the cattle in proportion to their agreed value, the assignment and proposi cions present such error as will reverse the case. We find no error assigned in the brief of appellant, either by assignment, proposition, or statement, that appellee’s damages would have been less than the amount he actually did recover, had the rule of proportion been applied under the agreement. Railway Co. v. Vasbinder, 172 S. W. 763. The exceptions to the charge given are not that it gives an erroneous measure of damages.

The fourth and fifth assignments do not present error on the ground that the charge gave the measure of damages based upon the difference in the market value in the condition the cattle arrived at market and their value in the condition in which they should have arrived, instead of instructing that the damages should be based upon the measure stipulated for in the agreement. The error, if error, to our mind, is not presented in such way as now required under our statute with reference to exceptions and assignments, which will enable us to say there was error, properly excepted to in the court below, which should reverse the case.

We have, however, reached the conclusion that, should the assignment be sufficient to present the questions involved in such way as to call on us to pass upon it, the court did not commit such error in charging the jury as will require a reversal. Conceding that the law charges the shipper with notice of the freight rate, whether he knew it or not, it will not affect the status of the parties in this case. The only testimony in the record is that the option was with the shipper to select the rate. The evidence is undisputed in this case that he did so. The agent denied him that right, or what was tantamount to a denial that there was any other rate than that given in the bill, thereby refusing to recognize appellee’s option, and forced upon him a contract without stamping on the bill, “At carrier’s risk.” Had the rate been paid, the bill would have still appeared to evidence an agreement as to the value of the cattle and the damages which the shipper should recover.

In the case of Atchison, etc., v. Robinson, 233 U. S. 173, 34 Sup. Ct. 556, 58 L. Ed. 901, the regulation in the tariff set out therein is substantially that proven in this case; that is, that the shipper had the choice of accepting contracts of shipment with or without limitation of liability and rates accordingly. The court there said:

“We regard these cases as settling the proposition that the shipper, as well as the carrier, is bound to take notice of the filed tariff rates, and that so long as they remain operative they are conclusive as to the rights of the parties.”

In the case of Boston, etc., v. Hooker, 233 U. S. 97, 34 Sup. Ct. 526, 58 L. Ed. 868, it is said:

“She [the shipper in that case] might have made no valuation of her baggage, in which event the rate and the corresponding liability would have automatically attached.”

Again it is said:

“The effect of the filing gives the regulation as to baggage the force of a contract determining ‘baggage liability.’ ”

In this case there is no pretense that ap-pellee actually valued his cattle as set out in the bill of lading; that it was arbitrarily so valued by the company there can be no question, but because it had filed two rates, and then refused to accept the higher, it is claimed under the authorities, such as Railway Co. v. Harriman, 227 U. S. 657, 33 Sup. Ct. 397, 57 L. Ed. 690, and many others, that ap-pellee is estopped to show the actual value or his actual damages. If its rate when filed is binding on the shipper, it is also binding on the carrier, and when it gives the option to the shipper as to which rate he will pay, and the shipper elects to pay the higher rate, then automatically, as we understand; this defeats a fictitious contract as to value based on the lower rate. The filing of the regulation gives it the effect of a 'contract, and we apprehend the contract is as binding on tbe carrier as on tbe shipper. We think in this ease estoppel operates against tbe carrier, and not tbe shipper. When it is said to the shipper he should have tbe option to pay the higher rate, and he exercised that option, it cannot refuse to recognize the right after having pledged itself to the public and the government that it would recognize it. The fact that the contract was signed in this case with a value so fixed will not, as we understand it, estop appellee, especially when appellant had no other printed contract than that, either for the higher or lower rate. The contract is the same in each instance. The tariff rate is incorporated automatically into the contract by the election to pay the higher rate. The fact that the money was not actually paid will not, we think, estop the appellee. He had no way while his cattle were on the track of forcing the company to take it. It cannot, we think, make its failure to accept the freight a ground to defeat its liability under its published higher tariff rate and its contract to accept the rate. It should not be permitted to urge a forfeiture clause upon its own wrong. It certainly ought to be estopped from saying it did not know the value of the animals, and relied upon the statement in the contract of value when the appellee was insisting upon paying on a higher valuation, and was making such offer under the appellant’s express published agreement that he should have the right to so elect. The appellant had an effectual method of collecting its freight rate; it was not required to deliver the freight until it received its lawful rate as agreed upon. Texas, etc., v. Mugg, 202 U. S. 242, 26 Sup. Ct. 628, 50 L. Ed. 1011.

The carrier is not liable to damages for misquoting a rate less than the full published rate. Ill. Ry. Co. v. Henderson, etc., 226 U. S. 441, 33 Sup. Ct. 176, 57 L. Ed. 290. But we see no reason why it should not be held liable under its contract for full damages, when it makes the rates part of the contract and gave the shipper the option of accepting. Its agent knew, or should have known, of the rate. All he had to do in this instance to make the contract entirely different was to use a rubber stamp on the bill, “At carrier’s risk.” The refusal of the agent in this instance was the act of appellant. His act in failing to place the rubber stamp on the bill amounted to a false billing. It was no part of appellee’s duty to so place it. His right was to exercise the option, which he did. It was the railroad’s duty, under the act of Congress, to issue the receipt on the tariff accepted; if it did not do so, it was guilty of false billing.

“If no value is stated, the tariff rate applicable to such a state of facts applies. If, on the other hand, there are -alternative rates based on value, and the shipper names a value to secure the lower rate, the carrier, in the absence of something to show rebating or false billing, is entitled to collect the rate which applies to goods of that class, and, if sued for their loss, it is liable only for the loss of which shipper has declared them to be in class and value.” Great Northern Railroad v. O’Conner, 232 U. S. 508, 34 Sup. Ct. 380, 58 L. Ed. 703.

In this case it is clear from the testimony that appellee did not accept the rate named in the bill or the valuation on his cattle. He offered the higher rate, which appellant refused, and issued a false bill. It was the agent’s duty, when the higher rate was selected by the shipper, to stamp on the bill with the rubber stamp, “At carrier’s risk.” This he did not do. We do not think any more sacredness should be attached to a railway bill of lading than any other contract. It is the railway’s duty to give the instrument. In this case it had prepared a printed form, the same for both rates, and made its published rates part of the contract, dependent on the option of the shipper. It is a rule in all contracts of this kind, where one party is given an option to make a binding contract and he exercises the option, he may then enforce the contract so made. The contract as made cannot be defeated by the other party refusing to recognize the option it had theretofore given. Courts will enforce agreements when it is shown the option has been exercised. The railroad in this case may collect the difference in the rate, and doubtless has its remedy therefor. The fact that the shipper signed the contract giving the value will not affect the case, as we understand, under that line of cases which hold that it is the rate, which is part of the contract, that is to be looked to for the value upon which payment is to be made.

The fourth and fifth assignments are overruled. We do not believe the charge of the court is amenable to the objections made. If the charges are otherwise not verbally accurate, exceptions were not presented calling attention to such inaccuracies.

The case will be affirmed.
      <gs3Por other cases see same topic and KEY-NUMBER in ail Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: HENDRICKS, J.

license: Public Domain

text:
    FERGUSON v. SANDERS.
    (No. 761.)
    (Court of Civil Appeals of Texas. Amarillo.
    April 3, 1915.
    Rehearing Denied May 1, 1915.)
    1. Compromise and Settlement &wkey;>20 — Con-traco^-Breach.
    Where two partners, between whom actions were pending, agreed upon a settlement by the terms of which one transferred to the other certain claims against third persons, and one of the claims so transferred had already been fully paid, the contract was breached in its inception and furnishes no ground for recovery by the partner making the transfer against ' the other for proceeding to judgment in one of the actions.
    [Ed. Note. — -For other cases, see Compromise and Settlement, Cent. Dig. §§ 83-88; Dec. Dig. <S&wkey;20J
    2. Judgment <&wkey;335 — Vacation—Bill oe Review — Remedy at Daw.
    A bill of review does not lie to set aside a judgment where the judgment defendant neg-iected to make use of a legal remedy to vacate the judgment.
    [Ed. Note. — For other cases, see Judgment, Cent. Dig. §§ 647-603; Dec. Dig. &wkey;335.]
    3. Justices oe the Peace &wkey;>126<-Civu, Actions — CertiobaRI—Diligence.
    Where one against whom a judgment had been rendered by a justice of the peace learned of the judgment four days before the expiration of the time within which to sue out a writ of certiorari, but left town on other business so that his attorney could not take any action in time, he did not exercise due diligence and is not entitled to a bill of review to vacate the judgment.
    [Ed. Note. — For other cases, _ see Justices of the Peace, Cent. Dig. §§ 400, 464; Dec. Dig. &wkey;»126.]
    Appeal from Hals County Court; W. B. Lewis, Judge.
    Action by O. C. Sanders against Joe Lee Ferguson. Judgment for the plaintiff, and defendant appeals.
    Reversed and rendered for defendant.
    Graham & Graham, of Plainview, for appellant. Y. W. Holmes, of Plainview, for ap-pellee.
   HENDRICKS, J.

This record shows that upon September 12,1913, two suits were pending, in which these same parties were litigants, one in the justice court at Hale Center, Hale county, Tex., and the other in the county court of said county. By written contract, executed by the parties upon that date, it was agreed that said suits would be dismissed, in consideration of which the appel-lee Sanders released to Ferguson, the appellant, all his interest in certain claims, some evidenced by promissory notes, and some by open account, including a claim against the railway company for damages to certain hay; said contract also containing the following stipulation: “All claims against J. J. Ellerd for hay is hereby transferred to said Ferguson by said Sanders.”

Slanders and Ferguson had previously been partners in the hay business, and the contract of settlement transferring Sanders’ interest to Ferguson in the claims mentioned, and providing for the dismissal of the suits as indicated, was a compromise settlement of their contentions. The suit of Ferguson against Sanders, in the justice court, was not dismissed, but on October 13, 1913, a month after the execution of the contract, Ferguson procured judgment against Sanders for the amount of $S2.99, demanded in that proceeding. Execution was issued upon this judgment, and on the 8th day of January, 1914, was levied upon 68 sacks of grain owned by Sanders, and thereafter sold to Ferguson, the judgment creditor, for $126.01. The amount necessary was applied on the judgment ,in satisfaction of same, and the balance, evidenced by check, sent to Sanders, which was refused. Sanders then sued Ferguson in the justice court, in which the said judgment was rendered, to set aside the same, which was done, from which judgment Ferguson appealed to the county court, in which latter court Sanders had instituted another suit against Ferguson, for damages, actual and exemplary, alleging a violation of the contract by Ferguson in not dismissing said justice court suit, and also alleged a fraudulent rendition of said judgment, levy of execution, and sale of property thereunder. The two suits, the one to review and set aside the justice court judgment, after appeal to the county court, and the other for damages, instituted in the latter court, were consolidated in said latter court.

We think this record exhibits a lack of cause of action by Sanders against Ferguson. As stated, these men had been partners, engaged in the grain and hay business, the record suggesting that Ferguson was furnishing the money, and Sanders contributing his labor and experience. Contentions had arisen between them, suits had been filed, the parties were not upon speaking terms, and as a matter of settlement and for the purpose of ending the litigation between them, Sanders released and assigned to Ferguson the claims, open accounts and notes as indicated, including a transfer, as quoted, of all claims against J. J. Ellerd for hay. This record conclusively shows that in the spring of 1913, months previous to the settlement contract in September, 1913, hay had been sold by Sanders to Ellerd; the scale tickets representing the weight and delivery had been turned over to Ferguson, and that Ferguson credited Sanders with the hay, the latter looking entirely to Ellerd; and on the 24th day of April (several months previous to the contract of settlement) Ferguson had a settlement with Sanders as to the Ellerd hay, which is also undisputed. Ferguson also testified that at the time the contract of settlement, September 13,1913, was executed, Sanders represented that there was a claim of $19.60 for hay against Ellerd, which is likewise undisputed, and which Ferguson supposed was additional hay to that purchased by Ellerd in April; and upon demand by Ferguson to Ellerd, the latter claimed he had paid for all the hay he had purchased, and it developed that Ellerd in reality (though there is some slight confusion in regard to one load) had only purchased three loads of hay. It is conclusive that Sanders, who weighed and sold the hay, only accounted to Ferguson for three loads. The man who hauled the hay testified that he only got three loads. Ferguson settled with Ellerd for only three loads, and on the 24th of April, 1913, settled with Sanders for only three loads. It is certain that Sanders did not have a claim against Ellerd for $19.60, on the 13th day of September, 1913, over and above the three loads of hay sold by him to Ellerd, and with reference to which a settlement had been made by- Sanders with Ferguson months previously.

When Sanders transierred to Fergnson all claims for hay against Ellerd, in reality he had nothing to transfer, and the contract executed by him was broken when made; and in predicating this suit upon a breach by Ferguson of the contract, claiming that the latter failed to dismiss the suit, he is suing upon a contract he had already broken, and is in no attitude to recover. Fink v. Hough, 153 S. W. 676.

Considering the question only as a part of the original county court suit, as an element necessary for Sanders to prove, we do not think that he has exhibited sufficient right to set aside the justice court judgment by a bill of review after a term of that court had expired. In the case of Railway Co. v. Ware, 74 Tex. 47, 11 S. W. 919, Justice Gaines held, upon an injunction proceeding, where the service of citations and returns thereupon were defective in justice court cases (in fact void), “that if the defendant in a void judgment has had an opportunity to avail himself of a legal remedy to vacate it, and has neglected to make use of it, relief by injunction should be denied him,” holding that the railway company in that cause “had a remedy by writ of certiorari in each case” ; that is those cases where the amount in controversy exceeded $20.

In this cause the constable levied upon the grain at Hale Center the Sth of January, 1914, which was Thursday; he went to Plain-view upon the noon train and consulted his lawyer. The lawyer telephoned Thursday to Hale Center for information as to what had been done. The constable informed him that he had levied an execution upon a judgment rendered in the justice court in the Ferguson-Sanders suit, and without obtaining any further information, the attorney wrote a letter which he knew would be mailed the next day, Friday, and Sanders left for Crosbyton, on other business, his attorney receiving the papers Saturday from Hale Center, and testifying that on account of Sanders’ absence he could do nothing, meaning thereby that he was unable to apply for and obtain a writ of certiorari on account of the absence of his client. The 90 days after the date of the rendition of judgment within which to obtain the writ of certiorari in the county court nominally expired upon Sunday, but on account of the last day falling on Sunday, that day is not counted and the writs of certiorari could have been obtained the next day, Monday. Hanover Fire Insurance Co. v. Shrader & Rogers, 89 Tex. 37, 32 S. W. 872, 33 S. W. 112, 30 L. R. A. 498, 59 Am. St. Rep. 25. Voluntary absence of a client should not be set up as due diligence. We think the opposite was shown in this record, therefore this cause comes within the principle of Railway Co. v. Ware, supra, decided by Justice Gaines of the Supreme Court.

Reversed '-and rendered.
      <&wkey;For other oases see same topic and KEY-NUMBER, in all Key-Numbered Digests and Indexes

      <J&wkey;For other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: CONNER, C. J.

text:
    KELLEY v. AUDRA LODGE NO. 438, FRATERNAL UNION OF AMERICA, et al.
    (No. 8156.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 10, 1915.)
    1. Bills and Notes <@=>442 — Parties — Agreements to Sign Note.
    Where a party promised to sign a note in renewal of one on which he was liable, but fraudulently failed to do so, the cause of action of the holder of the renewal note was not on the note but for the breach of the-contract or promise to sign the note.
    Lita, in ote. — For other cases, see Bills and Notes, Cent. Dig. §§ 1286, 1294-1301, 1303, 1309; Dec. Dig. <&wkey;442.]
    2. Bills and Notes <&wkey;442 — Parties — Agreements to Sign Note.
    In an action against K. and G. on a note given to renew a note for money loaned to G., on which K. was liable, where it was not claimed that K. signed the note sued on, and though it, was claimed he promised to sign it, and fraudulently failed to do so, it was not shown that his promise was in writing, it did not appear that the surrender of the old note to G. prejudicially affected the' payee, that. G. was insolvent, or that, by means of the surrender of the old note, the debt had been lost, and the case was not tried as an action on the old note, the judgment against K. could not be sustained.
    [Ed. Note — For other cases, see Bills and Notes, Cent. Dig. §§ 1286, 1294^1301. 1303, 1309; Dec. Dig. &wkey;44-2J
    3. Courts <&wkey;247 — Decisions Reviewable— Amount in Controversy — Jurisdiction.
    Under Vernon’s Saylcs’ Ann. Civ. St. 1914, art. 1589, cl. 3, providing that the appellate jurisdiction of the Courts of Civil Appeals shall extend to civil cases of which the county court has appellate jurisdiction, when the judgment, or amount in controversy, or the judgment rendered, shall exceed $100, exclusive of interest and costs, the Court of Civil Appeals has no jurisdiction of an appeal from a judgment of the county court, rendered on appeal from the justice court, in an action on a note for $100, containing no stipulation for the recovery of attorneys’ fees.
    [Ed. Note. — For other cases, see Courts, Cent. Dig. §§ 487, 749, 751-754, 757, 759, 760, 762-764; Dec. Dig. <@=>247.]
    Appeal from Taylor County Court; E. M.. Overshiner, Judge.
    Action by Audra Lodge No. 438, Fraternal Union of America, and others, against W. A. Kelley and another.
    From a judgment for-plaintiffs, the defendant named appeals. Reversed and remanded as to the appealing defendant.
    Ben L. Cox, of Abilene, and Tom Patterson, of Winters, for axipellant. Cunningham & Sewell, of Abilene, and J. P. Cogdell, of Winters, for.appellees.
   CONNER, C. J.

This suit was instituted in a justice court against I. L. Griffith and W. A. Kelley upon a promissory note in the-principal sum of $110, with the usual stipulation for attorney’s fees. The note was -signed by I. L. Griffith alone, but it was al-. leged, in substance, that several years pre- . vious the lodge had loaned I. L. Griffith $100 - in money, taking his note therefor, with a mortgage upon certain personal property; that later Griffith, desiring to have the personal property released, renewed the note with W. A. Kelley as personal security thereon; that, upon the maturity of this renewal note, it was surrendered to Griffith upon the promise of Griffith and Kelley that a new note should be given, with Kelley thereon as security as before, but that Kelley had fraudulently failed and refused to sign the note as he had agreed to do. After a trial and judgment in the justice court, which it is not necessary to particularize, the cause was appealed to the county court and tried upon substantially the issues presented in the justice court. The trial in the county court resulted in a judgment in favor of the lodge for the full amount sued for against both I. L. Griffith and W. A. Kelley, and W. A. Kelley alone has appealed.

Appellant insists that his general demurrer to the plaintiff’s pleading should have been sustained, and that the verdict and judgment against him are not supported by the law and the evidence, and we think these contentions are supported by the record. It is not pretended that appellant signed or otherwise became a party to the particular note made the foundation of this suit. As that note, it is only alleged that he had promised to sign it and fraudulently failed to do so. Plaintiff’s cause of action, therefore, as against W. A. Kelley, as alleged, was not upon a contract to pay a specified sum of money, as evidenced by the note, but for the breach of a contract or promise to sign the note, and it is neither alleged nor shown that this promise was in writing. If, in any event, a cause of action can be predicated upon such a breach, it was neither alleged nor proved in the present ease. While it was alleged that the preceding note, upon which W. A. Kelley’s name did appear, had been surrendered to I. L. Griffith, it was neither alleged nor shown that its surrender to Griffith prejudically affected the Audra Lodge. It was not alleged that Griffith was insolvent, or that, by means of the surrender of the old note, the debt had been lost. So that in no phase of the case, as presented by the present record, can it be said that the judg'ment below should be affirmed.

The pleadings are probably broad enough to support a judgment against appellant upon the note actually signed by him, and which it was alleged was surrendered to Griffith. But the case was not tried below upon any such theory, and, had this note been made the foundation of the .suit rather than that specifically declared upon, this court would have been without appellate jurisdiction, inasmuch as the record now before us indicates that that notice was but for the sum of $100, without any evidence that it contained any stipulation for the recovery of attorney’s fees. See Vernon’s Sayles’ Tex. Civil Statutes, art. 1589, cl. 3, which confines our appellate jurisdiction over judgments of the county court to amounts exceeding $100, exclusive of interest and costs.

In view of the conclusions above announced, other assignments need not be considered.

For the errors indicated, however, it is ordered that the judgment be reversed, and the cause remanded as to appellant; the judgment against I. L. Griffith not being disturbed.
      <gz^>For other cases see same topic and KEY-NUMBER in all ICey-Numbered Digests and Indexes


author: DUNKLIN, J.

text:
    WALL & CARR et al. v. J. M. RADFORD GROCERY CO.
    (No. 8151.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 10, 1915.)
    1. Account, Action on <&wkey;ll — Verified Account as Prima Facie Evidence — Sufficiency of Account.
    Under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 3712, providing that when an action or defense is founded upon an open account, supported by affidavit, it shall be taken as prima facie evidence thereof, unless the party resisting it shall file a written denial, under oath, stating that the account is not true in whole or in part and, if in part only, stating- the items which are unjust, where the first item in an account was for merchandise, but the rest of the items, with the exception of several charges of interest, without any statement showing upon what sums, for what period, or at what rate the interest was charged, consisted merely of dates and of amounts, without stating whether for merchandise sold or for a debt of some other character the account was not sufficient to support a default judgment.
    [Ed. Note. — For other cases, see Account, Action on, Cent. Dig. §§ 32-36; Dec. Dig. <&wkey;ll.j
    2. Interest <&wkey;34 — Agreements as to Interest-Necessity of Writing.
    To recover 10 per cent, interest on any item of an account and 10 per cent, attorneys’ fees, it was - necessary to prove an agreement in writing to pay such sums.
    [Ed. Note. — For other cases, see Interest, Cent. Dig. §§ 71-74; Dee. Dig. &wkey;34.j
    3. Interest <&wkey;34^AGR®EMBNTS as to Interest-Sufficiency of Evidence — Verified Accounts — “Open Account.”
    A verified account sued on, which contained charges of interest, did not tend to prove a written agreement to pay interest on the items of the account at the rate of 10 per cent., as the charges for interest were founded upon a definite contract, and were not a part of the “open account” contemplated by Vernon’s Sayles’ Ann. Civ. St. 1914, art. 3712.
    [Ed. Note. — For other cases, see Interest, Cent. Dig. §§ 71-74; Dec. Dig. <&wkey;34.
    For other definitions, see Words and Phrases, First and Second Series, Open Account.]
    Appeal from Taylor County Court; E. M. Overshiner, Judge.
    Action by the J. M. Radford Grocery Company against Wall & Carr and others. Judgment for plaintiff, and defendants appeal.
    Reversed and remanded.
    Tom Lea, Jr., of El Paso, and Cunningham & Oliver, of Abilene, for appellants. Kirby & Davidson, of Abilene, for appellee.
   DUNKLIN, J.

The J. M. Radford Grocery Company instituted this suit against J. M. Wall and H. D. Carr, composing the partnership firm of Wall & Carr, upon an account for merchandise alleged to have been sold to defendants, and, from a judgment by default in favor of the plaintiff, the defendants have appealed. A motion for new trial was filed by the defendants, which was overruled.

By several assignments of error appellants present the contention that the evidence introduced by plaintiff upon the trial of the case was insufficient to support the judgment.

A statement of facts appears in the record, which shows that the only evidence offered to establish the amount of plaintiff’s claim was an account to which was attached an affidavit in the form prescribed by article 3712, 3 Vernon’s Sayles’ Tex. Civ. Stat. That account was filed with the plaintiff’s petition, and suit was based thereon. By the terms of the statute referred to, it is provided, substantially, that, when any action or defense is founded upon an open account verified in accordance with the requirements of that statute, the same shall be taken as prima facie evidence of the justness of the demand, which the defendant cannot controvert, in the absence of a written denial by him under oath stating that the account is not just, and, if unjust in part only, specifying the items which are unjust.

If the account in question was such an account as is contemplated by the statute, then there is no merit in the assignments now under discussion. There are some 40 items in the account, the first of which reads: "Feb. 19, 1913. To Mdse, $22.58.” The rest of the items consist solely of dates, and of amounts without stating whether or not the amounts were for merchandise sold, save and except that seven items indicated charges for interest, without any statement showing upon what sums, or for what periods of time, nor for what rate of interest the charges were made. It is well settled by the authorities that accounts, within the meaning of the statute, contemplate statements showing the items for which the charges are made, and clearly the account introduced in evidence by the plaintiff falls far short of such a statement. Hickman v. Scudder-Gail Grocer Co., 62 S. W. 1081; Pittsburg Plate Glass Co. v. Roquemore, 88 S. W. 449; McCamant v. Batsell, 59 Tex. 363. Furthermore, it appears that the court allowed interest on the balance shown by the account in favor of the plaintiff at the rate of 10 per cent, per an-num, and also 10 per cent, attorney’s fees, under añ allegation in the plaintiff’s petition that defendants had entered into a written agreement with the plaintiff to pay interest at the rate of 10 per cent, per annum from the maturity of each invoice of goods sold and 10 per cent, attorney’s fees upon all indebtedness placed in the hands of an attorney for collection. Presumably the interest items shown in the account were computed at the rate of 10 per cent, per annum instead of 6 per cent., the maximum legal rate allowed, in the absence of some written agreement to pay more than that rate. As shown already, there was no proof of this alleged written agreement. In Oden & Co. v. Vaughn Grocery Co., 34 Tex. Civ. App. 115, 77 S. W. 967, it was held that an account which is not an “open account,” within the meaning of the statute referred to above, although verified according to the provisions of that statute, would not furnish sufficient proof to sustain a judgment by default. In Brin v. Wachusetts Shirt Co., 43 S. W. 295, and Duer v. Endres, 1 White & W. Civ. Cas. Ct. App. § 323, it was held that an open account, not verified as provided by that statute, will not support a judgment by default.

Plaintiff’s cause of action in chief was for the value of merchandise sold to defendants, but, save and except the first item, neither the account itself nor the affidavit attached thereto purported to show whether any of the items charged against defendants were for merchandise sold, for money loaned, or for indebtedness incurred by reason of transaction of some other character. In order to recover 10 per cent, interest on any item of the account and 10 per cent, attorney’s fees, it was necessary to prove an agreement in writing by defendants to pay such sums. While such an agreement was alleged, none was offered in evidence, and clearly the account itself, although verified, neither purported nor legally tended to prove it. Those demands were founded upon a definite contract and could not come within the meaning of “open account,” as used in the statute. Wroten Grain & Lumber Co. v. Mineola Box Mfg. Co., 95 S. W. 744; Bishop v. Mount, 152 S. W. 442. Failure of proof in the particulars mentioned above would require a reversal of the judgment, even though defendants had not made default, but had appeared and defended the suit, and for such lack of proof the judgment must be reversed.

The foregoing conclusion renders it unnecessary to determine the further questions whether or not, upon the hearing of the motion for new trial, defendants furnished sufficient evidence that, upon another trial, they could show a meritorious defense to plaintiff’s cause of action, such defense being set out in the motion, and whether or not they furnished sufficient proof to excuse their failure to file an answer and their delay in filing a motion for new trial.

Appellee has filed cross-assignments of error, the sole purpose of which was to exclude from our consideration two bills of exception taken by the defendants upon the hearing of the motion for new trial, one of which relates to the exclusion of certain testimony offered by the defendants in support of the motion, and the other containing a showing that the account referred to above was the only evidence offered upon the trial of the case. The statement of facts, which is agreed to by counsel for both parties, shows that the only evidence offered was the account, and, as our decision is not based upon the action of the court shown in the other bill of exception, a determination of the merits of the cross-assignments becomes immaterial.

For the reasons indicated, the judgment is reversed, and the cause remanded.
      ©=oFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: BUCK, J.

text:
    LUSK v. HARDIN.
    (No. 8164.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 17, 1915.)
    COURTS <&wkey;170 — County Court — Petition-Allegation of Jurisdictional Amount-Necessity.
    Failure of petition in county court for foreclosure of a chattel mortgage, to alleg-e the value of the mortgaged chattels, so as to show that the amount involved was within the court’s jurisdiction, was a fatal defect.
    [Ed. Note. — For other cases, see Courts, Cent. Dig. § 427; Dec. Dig. ,<&wkey;>170.]
    Error from Comanche County Court; J. H. McMillan, Judge.
    Action by H. H. Hardin against C. W. Lusk. Judgment for plaintiff, and defendant brings error.
    Reversed, and cause remanded.
    Kearby & Kearby, of Comanche, for plaintiff in error. Smith & Palmer, of Comanche, for defendant in error.
   BUCK, J.

Plaintiff filed suit in the county court of Comanche county on a promissory note alleged to have been executed by defendant in the sum of $220.85 with interest and attorney’s fees, and an open account in the sum of $69.40, alleging that to secure the payment of the above note a chattel mortgage was retained upon certain described property consisting of horses, cows, a wagon, and phaeton; but the petition failed to allege the value of such property upon which the mortgage was retained. Judgment was rendered for plaintiff for the amount sued for, and in the judgment it was recited that:

“The defendant through his counsel having formerly withdrawn the answer heretofore by him filed in this case, and the defendant making no further appearance,” etc.

No statement of facts appears in the record, and the defendant in error has filed no brief.

The plaintiff in error’s first and only assignment, which is adopted as a proposition, is as follows:

“The court erred in entertaining jurisdiction of this cause and rendering judgment for the plaintiff for any amount, because it appears from the petition upon which judgment was rendered that this was a suit in the county court, upon a note and account, and for the foreclosure of an alleged mortgage lien upon certain personal property described in plaintiff’s petition and in the judgment of the court, and the said petition does not affirmatively show that the county court had jurisdiction of the subject-matter of said suit, and that it failed to allege the value of the mortgaged property against which foreclosure is-prayed.”

We believe this specification must be sustained. Under the great weight of authority upon this point in this state, the absence of an affirmative allegation in the petition showing that the trial court had jurisdiction constitutes fundamental error, and the value of the property upon which a mortgage lien has been retained and upon which a foreclosure of said lien is sought determines the question of jurisdiction vel non of the trial court, that is, the amount in controversy is the alleged value of the chattels upon which a foreclosure is prayed. Stricklin v. Arrington & Carter, 141 S. W. 189; Bates v. Hill, 144 S. W. 288; Ware v. Clark, 125 S. W. 618; Walker Merc. Co. v. J. R. Raney Co., 154 S. W. 317; Wilson v. Ford, 159 S. W. 73; Edwards v. Dennington, 161 S. W. 929; Randals v. Bank, et al., 162 S. W. 1190; Brown v. March, 149 S. W. 353. In a suit to foreclose a mortgage on chattels, the amount in controversy is the alleged value of such chattels. Cotulla v. Goggan, 77 Tex. 32, 13 S. W. 742; Railway Co. v. Rucker, 38 Tex. Civ. App. 592, 88 S. W. 815; Smith v. Carroll, 28 Tex. Civ. App. 330, 66 S. W. 863. Tested by this rule, if the value of the property upon which plaintiff sought a foreclosure had been alleged to. be a sum in excess of $1,000, the petition would have showed that the county court, was without jurisdiction to hear and determine the suit. As was said in the ease of' Stricklin v. Arrington & Carter, supra, by this court, speaking through Mr. Justice • Dunklin:

“In order for this court to affirm the judgment, it must affirmatively appear from the-record that the county court had jurisdiction to render it, and, in the absence of such showing, the judgment should be reversed.”

In the case of Cantrell v. Cawyer, 162 S. W. 919, the Court of Appeals for the Third District, speaking through Justice Jenkins,. holds that where a petition in an action in. the county court shows that the amount sought to be recovered is within the jurisdiction of the court, and seeks to foreclose a chattel mortgage on property, the value of' which is not disclosed, such petition states a cause of action within the jurisdiction of the court, in the absence of any suggestion of want of jurisdiction based on the value of' the property, and declines to follow the holdings to the contrary by this court and that of the First district While we appreciate ■ the plausibility of the reasoning and argument used by Justice Jenkins in the case mentioned, and as an original proposition, we ■ would, as applied to this case, be very much, inclined to the conclusions reached in the opinion by him; yet we have, nevertheless, felt constrained by the authorities before - cited to refuse to follow it. The case of Ran-dais y. Bank, supra, is by the Court of Appeals for the Eighth District, and is in harmony with the authorities cited from the Second and Eirst districts.

For the reasons above indicated the judgment of the trial court is reversed and the cause remanded.
      igrzeFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: HALL, J.

text:
    FORSTER v. ENID, O. & W. R. CO. et al.

    (No. 758.)
    (Court of Civil Appeals of Texas. Amarillo.
    April 3, 1915.
    Rehearing Denied May 8, 1915.)
    1. Bills and Notes &wkey;>485 — Assignments—• Genuineness — Pleading.
    Under Rev. St. 1911, art. 588, providing that, unless defendant denies by liis sworn plea the genuineness of an assignment of the instrument, a maker of a note payable to a corporation and bearing an indorsement in the name of the corporation by its vice president and assistant treasurer cannot impeach the assignment without filing a sworn plea and affidavit.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1542-1554; Dec. Dig. &wkey; 485.]
    2. Bills and Notes &wkey;>485 — Actions—Good-Faith Holder — Pleadings.
    A sworn plea is not necessary to raise the issue of good faith of the holder of a note, holding under an indorsement.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1542-1554; Dec. Dig. <&wkey; 485.]
    3. CORPORATIONS <S=o384 — Transfers oe Obligations — Seal.
    The seal of a corporation is not necessary to a valid transfer of a note payable to it.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. § 1801; Dec. Dig. <&wkey;>384.]
    4. Bills and Notes &wkey;j363 — Bona Fide Purchaser.
    A purchaser of a negotiable note is not subject to the ordinary rules of constructive notice applying to a purchaser of property in general, and, where he has acted in goo'd faith and has paid a valuable consideration, his title cannot be attacked, and the acquisition of a note under circumstances tending to put a reasonable man on inquiry is merely evidence of bad faith.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 790, 791, 900, 962; Dec. Dig. <&wkey;>303.]
    5. Bills and Notes <&wkey;537 — Bona Fide Holder — Question oe Fact.
    AVhether a purchaser of a negotiable note acquired it in good faith is a question of fact.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1862-1893; Dec. Dig. &wkey;> 537.]
    6. Bills and Notes <&wkey;343 —Bona Fide Holder — Notice.
    A bank purchasing a note before maturity with mere knowledge that the consideration therefor was stock to be thereafter issued by a railroad corporation and the completion by it of a railroad then in course of construction is a purchaser in good faith.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 853-855, 864, 865; Dec. Dig. &wkey;j343.]
    Appeal from District Court, Hemphill County; F. P. Greever, Judge.
    Action by J. E. Forster against the Enid, Ochiltree & Western Railroad Company and others, in which defendant the First National Bank of Henry, Ill., filed a cross-action. From a judgment for the bank, plaintiff appeals.
    Affirmed.
    Crudgington & Works, of Amarillo, for appellant. W. W. Moore, of Houston, J. Y. Powell, of Dalhart, and A. A. Lumpkin and Del W. Harrington, both of Amarillo, for ap-pellee First Nat. Bank of Henry, Ill.

       Writ oí error pending in Supreme Court.

   HALL, J.

Appellant sued appellee railway company, S. J. Allen, trustee, H. G. Hendricks, receiver, and the First National Bank of Henry, Ill., to cancel his negotiable promissory note and deed of trust upon certain real estate securing the same, alleging, in substance, that the note was given for stock in the Enid, Ochiltree & Western Railroad Company, and in consideration of the agreement of said company to build a line of railroad near appellant’s property; that he subscribed for five shares at $100 each, and, having paid $75, instituted this suit to cancel the balance. The subscription contract showed that the capital stock of said railway company should be $500,000; that the line should connect the Santa Fg Railway on the east with the Denver or Rock Island on the west by way of Ochiltree; that the consideration for said note had failed, in that no stock was issued to appellant, and no road was ever built; that only about $333,000 of said stock was subscribed, and the route of said road changed without his consent from Dalhart to Ochil-tree only; that he was induced to change his liability upon the subscription contract to the negotiable note in question by the fraudulent representations of said railroad company’s agents to ■ the effect that funds had already been secured with which to build said road, and that the company was in good financial condition, all of which statements were untrue; that the promoters of said road conspired and confederated with Charles R. Jones, the president of the First National Bank of Henry, Ill., to secure the note in suit and a large amount of similar paper on the wreck of said railroad venture, they knowing that the company was without sufficient backing to complete the road. As a part of said scheme, said Jones acquired a $28,000 note for $25,000, to which was attached $40,000 worth of collateral notes, similar to the one in suit, and a section and a quarter of,land; that said company became insolvent, and was on April 6, 1911, placed in the hands of a receiver, and all of its- assets sold, said company being unable to complete the construction of the road; that said bank procured the note in suit without indorsement and with full notice of said defenses.

The appellee bank replied by plea of es-toppel, on the ground of appellant’s being a subscriber to stock in said company, and by general denial. By cross-action tlie bank prayed for judgment on the note with foreclosure of the lien, alleging that it was a bona fide purchaser for value thereof. Ap-pellee railroad company, by its president, adopted the bank’s pleadings.

From a judgment in favor of the bank for the full amount of the note and foreclosing the lien against appellant’s land, the controversy is brought here by appeal.

The principal facts are as follows: Appellant subscribed for five shares of the capital stock of appellee railway company, paying $75 in cash, executing his note for the balance. The subscription contract provides that all subscribers should, when called upon, give good and sufficient security for the deferred payments due upon subscription. The uncontroverted evidence is that the note in question was purchased by appellee bank in due course of trade for a valuable consideration, before maturity, without notice of any .defense thereto or defect therein, unless such notice was conveyed by the fact that it was part of an executory contract for stock or by the alleged illegal indorsement thereof by the vice president. The indorsement is as follows: “Enid, Ochiltree & Western Railroad Company, by A. E. Wiest, Jr., Vice President. W. T. Wheatley, Asst. Treasurer.” The evidence established the fact of the insolvency of the road, appointment of a receiver, and a sale of its properties, after the execution of the note.

Appellee challenges the right of appellant to attack or in any way question the validity of the assignment, because appellant did not, by his sworn plea, under article 58S, R. S. 1911, deny the genuineness of the assignment and file with the papers in the case an affidavit stating that he had good reason to believe, and verily did believe, the assignment or indorsement to be a forgery. It will be observed that appellant sought, not only to negative the genuineness' of the assignment by the railway company by attacking the indorsement of the vice president, and his authority to so transfer it, but he endeavored also to prove that the bank took the note wnth such notice of its infirmity as would impeach its good faith. Before the validity of the assignment could be attacked it was, under the decisions, necessary for appellant to file a sworn plea under the article above mentioned. The Supreme Court, in Sehauer et al. v. Beitel’s Executors, 92 Tex. 601, 50 S. W. 931, said:

“The proceeding by which, the title of an as-signee or indorser may be put in issue by the maker when sued upon a written instrument is prescribed in the following article of the Revised Statutes: [Quoting the article above.] * * * The answer of Sehauer, upon which this case was tried, did not contain an allegation that either of the assignments upon the note sued on was not genuine, nor does the affidavit which was filed with that answer state that the affiant ‘has good cause to believe, and verily does believe that such assignments are forged.’ In the state of the pleading the written transfers upon the note fully establish the title to it in the plaintiff and his right to recover • thereon. Grounds v. Sloane, 73 Tex. 662, 11 S. W. 898. In the case cited Judge Henry, for the court, said: ‘Clearly this statute intends to give an assignee of a written instrument the right to recover upon it without other proof than the production of the indorsed instrument unless its genuineness is denied specially in the answer, supported by an affidavit. Without such plea and affidavit, evidence contesting the validity of the assignment should not be heard. Even if evidence to the effect that the assignment for any cause is invalid or incomplete should be admitted in the absence of the plea required by the statute, it would go for nothing. A valid judgment cannot be rendered on evidence unsupported by a proper pleading. Without the prescribed plea the language of the statute is that the assignment ‘shall be regarded as fully proved.’ This includes delivery and everything else required to give the assignment legal effect. The statute would be of very little value to the assignee if it left it necessary for him to bring proof of the actual delivery of the assigned instrument, or left that fact open to attack under a general denial.’ ” Barker v. American Exchange Bank, 27 S. W. 1073.

In the absence of a sworn plea, we must presume not only that Wiest, as vice president, had full authority to make the transfer of the note, but every other fact in favor of the legality of the assignment.

The remaining question of importance is: Did the bank acquire the note in good faith so as to preclude appellant from urging the defenses of fraud and failure of consideration? A sworn plea is not necessary in order to raise the issue of good faith. Mayfield Grocery Co. v. Andrew Price Co., 43 Tex. Civ. App. 391, 95 S. W. 31; Handley v. Bank of Canyon, 149 S. W. 742; Smith v. Cooley, 164 S. W. 1051. The seal of the corporation was not necessary to a valid transfer. Hall & Tyson v. Bank, 53 Tex. Civ. App. 101, 115 S. W. 293. The purchaser of a negotiable note is not subject to the ordinary rules of constructive notice which apply to the purchaser of property in general. If he has acted in good faith and paid a valuable consideration therefor, his title cannot be impugned; the acquisition of the note, under circumstances tending to put a reasonable man on inquiry, merely being evidence tending to show bad faith. First National Bank of Aubrey v. Chapman, 164 S. W. 900; Wilson v. Denton, 82 Tex. 535, 18 S. W. 620, 27 Am. St. Rep. 908.

“It is a general principle, running throughout all branches and subjects of the law, that one will be charged with notice of a fact who has information which should have put him upon inquiry if by following up such information with diligence and understanding the truth could have been ascertained. Whether this principle is to be applied in respect to one who becomes possessed of negotiable paper has been the subject of some discussion. At one time it seems to have been agreed on all sides that actual knowledge on the part of the purchaser was not undis-putable, but that it would be sufficient if the circumstances were of such a strong and pointed character as necessarily to cast a shade upon the transaction and to put the holder upon inquiry. It is now well settled, however, that the doctrine of notice as it affects the good faith of transactions generally does not apply to negotiable instruments.” 3 R. O. L. p. 1071, § 277.
“At one time it seems to have been the prevailing view that where a party was about to receive a hill or note, if there were any such suspicious circumstances accompanying the transaction or within the knowledge of the party as would induce a prudent man to inquire into the title of the holder of the consideration of the paper, he would be bound to make such inquiry; or, if he neglected to do so, he should hold the bill or note subject to any equities which might exist between the previous parties to it. Negligence or diligence according to usual standards of character was made the criterion for determining whether he was chargeable with notice, but the prevailing view for many years has been to the effect that mere ground of suspicion, as to the existence of defenses to the instrument, is not equivalent to knowledge thereof by the purchaser.” Id. § 278.

The question of good faith is a question of fact. In the absence of a jury, the trial court, in determining the facts, has settled the question against appellant.

Appellant insists that because the bank purchased the note with knowledge that the consideration therefor was stock to be thereafter issued, and the completion of a railroad then in course of construction, it cannot be held to be a purchaser in good faith.

“The courts universally hold that knowledge that a note was given in consideration bf the executory agreement or contract of the payee which has not been performed will not deprive the indorsee of the character of a holder in due course unless he has notice of the breach of that agreement or contract. So knowledge of a warranty on a sale in which a note was given is held not to affect the rights of a purchaser of the note for value before maturity if he had no knowledge of the breach of the warranty. A recital in the instrument respecting such agreement or warranty is not sufficient of itself to advise him that there was or would necessarily be a failure of consideration. The presumption of law would be that the contract would be carried out in good faith and the consideration performed as stipulated.” 3 R. O. L. p. 1067, § 273.

The remaining assignments are overruled, and the judgment affirmed.

HENDRICKS, J., not sitting.
      <@^>For other cases see same topic and KEY-NUMBER, in all Key-Numbered Digests and Indexes


text:
    GARDNER v. ENID, O. & W. R. CO. et al.
    (No. 757.)
    (Court of Civil Appeals of Texas. Amarillo.
    April 3, 1915.
    Rehearing Denied May 8, 1915.)
    Appeal from District Court, Hemphill County ; E. P. Greever, Judge.
    Action by M. M. Gardner against the Enid, Ochiltree & Western Railroad Company and others. Erom a judgment for defendants, plaintiff appeals.
    Affirmed.
    Crudgington & Works, of Amarillo, for appellant. W. W. Moore,' of Houston, J. Y. Powell, of Dalhart, and A. A. Dumpkin and Del. W. Harrington, both of Amarillo, for appellee bank.
   HALL, J.

Investigation of the record shows that the issues raised by the pleadings, the facts established by the evidence, and the errors assigned in this case make it in all respects parallel with the cause of Forster v. Enid, Ochiltree & Western Railroad Co., 176 S. W. 788, this day decided by us, and for the reasons set out in the opinion in that case, the judgment herein is affirmed.

HENDRICKS, J., not sitting.


text:
    GULF, C. & S. F. RY. CO. v. WHITE et al.
    (No. 768.)
    (Court of Civil Appeals of Texas. Amarillo.
    April 10, 1915.
    Rehearing Denied May 15, 1915.)
    Courts <&wkey;170 — Texas County Coubj>^Ju-RISDICTIONAL AMOUNT.
    Since interest is not allowable on personal injury claims prior to the date of judgment unless plaintiff prays for the same, none can be included in the judgment so as to affect the jurisdictional amount.
    [Ed. Note. — For other eases, see Courts, Cent. Dig. § 427; Dec. Dig. &wkey;170.]
    Appeal from Potter County Court; W. M. Jeter, Judge.
    Action by Charles L. White, individually and as next friend, etc., against the Gulf, Colorado & Santa Fé Railway Company and another. From a judgment for plaintiff against the defendant named, it appeals.
    Affirmed.
    Terry, Cavin & Mills, of Galveston, and Madden, Trulove, Ryburn & Pipkin, of Amarillo, for appellant. Jones & Miller, of Amarillo, for appellee White.
   HALL, J.

This suit was instituted by ap-pellee Charles L. White, for himself and as next friend of his son, Charles L. White, Jr., against appellant and the Pecos & Northern Texas Railway Company, to recover damages in the sum of $1,000, alleged to have been sustained by said child while on defendant’s passenger train between Sweetwater, Tex., and Coleman, Tex., August 19, 1913. The trial resulted in a verdict for plaintiff against appellant alone for $20 for Charles L. White and $75 for the use and benefit of his son. It is unnecessary to set out the pleadings or the evidence in detail.

Appellant first raises the question of jurisdiction,, which is urged in this court for the first time. It contends that, since appellee sued for $1,000 the county court was without jurisdiction of the amount. It is insisted that the amount claimed in the petition bore interest at the rate of 6 per cent, from the date of the injury until the trial. The prayer was for $1,000, and did not mention interest. Interest is not allowed on personal injury claims in this state prior to the date’ of the judgment. T. & N. O. Ry. Co. v. Carr, 91 Tex. 332, 43 S. W. 18. Unless plaintiff prayed for interest, none can be included so as to affect the jurisdictional amount. P. & N. T. Ry. Co. et al. v. Rayzor (Sup.) 172 S. W. 1103.

We do not agree with appellant in its statement that the evidence is sufficient to prove negligence on the part of plaintiff’s wife which resulted in the injury to the child. If so, however, this negligence would not be imputed to the child. T. & P. Ry. v. Fletcher, 6 Tex. Civ. App. 736, 26 S. W. 446. The wife of appellee testified that when the child was lying on the chair asleep the brakeman came through the car hurriedly and jerked the chair back violently, catching the child’s toe in the mechanism of the chair; that the back of the chair was shoved instantly; and that the brakeman hurried on.

The evidence is conflicting in material matters, but, there being sufficient evidence to support the verdict, the judgment is affirmed.
      <&wkey;ITor other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


text:
    HOLMAN v. PINKARD et al.
    (No. 8163.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    April 17, 1915.)
    Public Lands <&wkey;173 — Contract to Convey —Validity.
    A contract embodied in a bond for title whereby the obligor, whose vendor had been in possession of school lands for over a year, contracted to convey to the plaintiff, was a valid obligation, and defendant, who had taken a conveyance from the obligor, agreeing to perform the conditions of such bond, was liable to the plaintiff for the land, since the obligor had a vendible title; his vendor having complied with the prescribed period of occupancy.
    [Ed. Note. — For other cases, see Public Lands, Cent. Dig. §§ 544-551; Dec. Dig. &wkey;>173.]
    Error from District Court, Comanche County ; J. H. Arnold, Judge.
    Action by Nat Holman against J. P. Pink-ard and others. Judgment for defendants, and plaintiff brings error.
    Reversed, and cause remanded.
    W. T. McPherson, of Comanche, and Ocie Speer, of Ft. Worth, for plaintiff in error. Callaway & Callaway, of Comanche, for defendants in error.
   BUCK, J.

This suit was instituted by plaintiff in error, Nat Holman, against J. P. Pinkard, 6. M. Hamilton, and Chas. Downie, defendants in error, to recover six sections of land in Pecos county, alleging that said land was state school land, and on September 11, 1911, G. M. Hamilton, being the owner of said land, and lacking more than a year of completing the three years’ occupancy required by the statute, executed a bond for title, binding himself to complete the occupancy and then convey said six sections in controversy to the plaintiff; that thereafter, on March 20, 1912, said Hamilton conveyed to J. P. Pinkard the land, in question, and the latter assumed and agreed to perform the conditions of the bond made by said Hamilton to the plaintiff; and that said Pinkard had completed the occupancy and had been awarded by the land commissioner said land, together with two other sections mentioned and described, but he had failed and refused to convey to plaintiff the six sections mentioned in said bond, whereupon plaintiff prayed for specific performance and in the alternative for damages in the sum of §5,000, being the amount mentioned in the bond.

The defendant Ghas. Downie was discharged on his disclaimer, and defendant Hamilton, who had failed to answer, was dismissed, with costs. The defendant J. P. Pinkard answered, admitting the execution of the bond for title by Hamilton and the deed from Hamilton to himself, but alleged that the deed was executed as a part of the larger contract between himself and Nat Holman, which was entered into about the 10th day of October, 1911, partly in writing and partly in parol, by which Nat Holman, who was soon to be the owner of the eight sections of land described in the deed from Hamilton to himself, agreed to sell Pinkard the said eight sections in Pecos county with the understanding that Pinkard should go upon the land and complete the occupancy and prove up on the land and reconvey to Holman five of the tracts containing six sections, reserving to himself three tracts containing two sections. Defendant Pinkard further alleged that said Hamilton did not own nor claim any interest in the land at the time he made the deed to Pinkard, but was merely living on it for Holman as a hired hand, and that Holman had the land put in Hamilton’s name and had the bond for title executed by Hamilton merely as a blind to cover up the real ownership of the land, which was in fact in Holman; that the bond for title was an illegal and fraudulent contract, and further that plaintiff had breached the contract in that he had failed to furnish to defendant Pink-ard certain money for the payment of interest and taxes on the land, and to furnish him employment while on the land at certain stipulated wages, and had failed to furnish him some $300 in money, all of which he alleged to be a part of the consideration for the agreement on his part to carry out and fulfill the terms of the bond aforesaid. He asked that the case be dismissed, and, in the event the court held the contract illegal, he be allowed to recover the land in question.

The eight sections had been awarded to W. R. Harris in December, 1909, and on July 18, 1911, said Harris and wife conveyed to Hamilton all of said sections. On the same date Hamilton executed to the state of Texas his application as a substitute purchaser from the state, and the deed from Harris to him was filed in the county clerk’s office in Pecos county, and after record was sent, together with substitute application, to and duly filed in the land office of the state of Texas, and said Hamilton was substituted as a substitute purchaser of said Harris. There was no question as to the regularity of any of the proceedings relating to the title of Harris, or as to his occupancy of the land, nor as to the sufficiency of his deed to Hamilton to convey title, nor of the deed from Hamilton to Pinkard, except as the latter was limited by the obligation therein of said Pinkard to carry out the terms of the bond .executed by Hamilton to Holman. The bond of title recites that:

“The said 6. M. Hamilton is to have full and complete possession of said land, and is to exercise full and complete ownership of said land, so far as the use and occupancy of said land is concerned, and the only limitation on his said ownership is that he (the said G. M. Hamilton) shall not sell or incumber said land so as to interfere with his right and power to make title as hereinafter agreed. Now, after the said G. M. Hamilton shall well and truly occupy and reside upon said land as the law governing the purchase and sale of school land provides, from the date of settlement and sale of said land to W. R. Harris, the original purchaser from the state, and after full and complete proof of occupancy and improvements made and accepted by the General Land Office of the state of Texas, all of which shall be done at the time and as soon as the law governing such matters requires and permits, the said G. M. Hamilton shall make, or cause to be made, a good and sufficient deed to said above-described land, showing good and perfect title to said land, with no liens outstanding against said land, except the original obligation of the original purchaser from the state, to the said Nat Holman, or his assigns, then and in that event this obligation shall be\ null and void, and otherwise to remain in full force and effect.”

The court, after the jury had been impaneled and sworn, and the plaintiff had introduced all his evidence in the case, and* after the defendant J. P. Pinkard had introduced his evidence bearing on his defense that the contract sued upon was illegal and fraudulent, instructed the jury peremptorily to find for defendant, and thereupon rendered judgment for defendant Pinkard, from which judgment this writ of error is prosecuted.

W. R. Harris, having completed his first year’s occupancy at the time of the deed by him to Hamilton, and having complied with the terms of the law with reference to said occupancy, had a vendible title in and to said lands; and Hamilton, his vendee, having qualified under the law as a substitute purchaser, and having been accepted as such by the general land office, acquired a vendible title. It certainly would not lie in the mouth of the subsequent vendee, Pinkard, who predicated the sufficiency of his title, and who based his claims before the land commissioner for the final award of these lands to him, upon the sufficiency of the title which he had acquired through Harris and Hamilton, to deny the validity of his vendor’s title. He has relied on the legality and sufficiency of the title received by Hamilton from Harris, and conveyed to him by Hamilton, in proving up his title under which he claims, and in effect has vouched 'to the state the good faith and the sufficiency of the occupancy of his vendor, Hamilton; and now that the 'state has received his proofs of the compliance with the terms of the law by Harris and Hamilton as legal tender and has awarded him the land, acknowledging said proofs as part consideration, can he who receives the benefits derived therefrom deny the genuineness of the coin which theretofore he guaranteed to his state? We think not. If so, such solemn averments of truthfulness of facts upon which the award was sought and obtained would become

“Ambition’s ladder, Whereto the climber upward turns his face; But when he once attains the upmost round, lie then unto the ladder turns his back, Looks into the clouds, scorning the base degrees By which he did ascend.”

That an executory contract to convey land, held by an actual settler, and after one year’s occupancy, is not inhibited by law, and is enforceable after the completion of the three years’ occupancy, we think is beyond question. Witcher v. Wiles, 33 Tex. Civ. App. 69, 75 S. W. 889; Hudman v. Henderson, 124 S. W., 187. We do not construe the cases of Brown v. Brown, 132 S. W. 887, and Purington v. Brown, 133 S. W. 1080, cited by defendants in error, as holding to the contrary. In Brown v. Brown, the facts showed that A. T. Brown was the awardee of four sections of state school land, purchased in June, 1906. In September, 1906, he and his wife conveyed the land to his son, Joseph T. Brown, who immediately thereafter moved thereon with his family, and occupied it as his home till the date of his death, July 6, 1907. His widow and child continued to reside thereon until the three years required by law had been completed. The controversy arose between the widow and her brother-in-law, Charley Brown. September 20, 1906, Joseph T. Brown had executed an obligation to convey to his brother, Charley Brown, thereafter, on, to wit, June 1,1909, a one-half undivided interest in and to the four sections, for certain recited considerations. Charley Brown sought to enforce the terms of this obligation. This court, speaking through Chief Justice Conner, in upholding the action of the trial court in peremptorily instructing the jury to find for the defendant, says:

“Appellant insists that no one but the state can raise the question of fraud, and that this court has upheld bonds for title, citing, among others, the leading cases of Logan v. Curry, 95 Tex. 664, 69 S. W. 129; Underwood v. King, 102 Tex. 561, 119 S. W. 298; Witcher v. Wiles, 33 Tex. Civ. App. 69, 75 S. W. 889. We think the present case, however, distinguishable from those mentioned, in that the bond for title upheld in Witcher v. Wiles, above referred to,.was executed after, and not, as here, at the time or before the title had vested in the party sought to be charged. Its performance required nothing inconsistent with the affidavits necessary to be made under the school land law, and the decision in Logan v. Curry, we think, is without application. In the case last referred to, an independent party sought to destroy the title of Logan because of alleged collusion between Logan and his vendor, but here a party is seeking the aid of the courts to enforce a collusive contract, which presents an altogether different question.”

The case of Purington v. Brown, supra, merely held, in so far as the questions therein decided are applicable to this discussion, that a verbal contract, for sale of land was. unenforceable and obnoxious to the statute of frauds, unless it further was shown, not only that a full consideration had been paid for the land and permanent and valuable improvements made thereon, but that the purchaser took possession of the land. In so far as certain expressions in that ease are relied on for authority to sustain the contention that an executory contract to convey state school land made subsequent to one year’s occupancy is inhibited by law, and constitutes collusion and evidence of bad faith on the part of the obligor settler, it appears that such observations were not necessarily involved in the correct disposition of the case, and were therefore, as we think, not controlling, and not supported by the authority cited (Brown v. Brown, supra) in support thereof.

Since we believe that the trial court erred in peremptorily instructing the jury to find for defendant, and inasmuch as this error is properly raised by plaintiff in error in his brief, we conclude that the judgment of the trial court must be reversed.

Since there are some issues raised by the pleadings of the defendant Pinkard as to a partial failure of the consideration moving from plaintiff to him, and an alternative prayer that, in the event the court should hold legal the contract sued on, he should be granted certain specified relief, we do not feel that we are justified in rendering judgment for appellant, as prayed, but that the cause should be remanded for further proceedings in harmony with conclusions herein expressed.

Judgment reversed, and cause remanded.
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