text:
    McCAULLEY v. FARMERS’ & MERCHANTS’ STATE BANK & TRUST CO.
    (No. 8117.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    March 6, 1915.
    Rehearing Denied April 10, 1915.)
    1. Judgment <&wkey;>253 — Amount — Petition-Ad Damnum Clause.
    Though the amount stated in the ad damnum clause is less, judgment may be rendered for the amount due, calculated according to the terms of the notes sued on, fully described in the petition.
    [Ed. Note. — For other cases, see Judgment, Cent. Dig. §§ 443, 444; Dec. Dig. &wkey;253.j
    2. Bills and Notes 4&wkey;534 — Provision for Attorney — Allowance.
    The full amount of attorneys’ fees stipulated in notes sued on may in the absence of plea and proof of its unreasonableness, and therefore on default, be included in the judgment.
    [Ed. Note. — For other cases, see Bills and Notes, Cent. Dig. §§ 1946, 1947; Dee. Dig. &wkey; 534.]
    Error from District Court, Nolan County; W. W. Beall, Judge.
    Action by the Farmers’ & Merchants’ State Bank & Trust Company against R. L. McCaulley. Judgment for plaintiff, and defendant brings error.
    Affirmed.
    H. R. Bondies, of Sweetwater, for plaintiff in error. E. J. Hamner, of Sweetwater, for defendant in error.
   DUNKLIN, J.

R. L. McCaulley has prosecuted this writ of error from a judgment by default rendered against him in favor of the Farmers’ & Merchants’ State Bank & Trust Company. The suit was upon two-promissory notes, and the amount of the judgment was $7,234.67, which included principal, interest, and attorneys’ fees. In plaintiff’s petition, after setting out the notes, and after alleging the failure of the defendant to pay the same, the ad damnum clause reads as follows: “To plaintiff’s damage in the sum of seven thousand dollars.”

Plaintiff in error insists that the amount of the judgment should have been limited to the amount stated in the clause ■quoted, and that the judgment is therefore excessive.

The petition sets out a full description of the notes upon which the suit was based, including dates, principal sums, rate of interest, and stipulations for attorneys’ fees, and the amount for which the judgment was rendered was the amount shown to be due upon the notes by actual calculation according to their reading and tenor. It is well settled by the authorities that the real amount in controversy is to be determined by the amount shown to be due under the facts well pleaded, and that the ad damnum clause in the petition is not controlling, and under those authorities the assignment now under discussion is overruled. See P. & N. T. Ry. Co. v. Canyon Coal Co., 102 Tex. 478, 119 S. W. 294; Ainsa v. Moses, 100 S. W. 791; Times Pub. Co. v. Hill, 36 Tex. Civ. App. 389, 81 S. W. 808.

By another assignment it is insisted that the court erred in rendering judgment for the attorneys’ fees provided for in the notes, because the stipulations for attorneys’ fees were contracts of indemnity, and plaintiff did not allege that it had paid or become liable therefor. The petition contained the following allegation:

“That plaintiff had placed said notes in the hands of its attorney, to wit, A. B. Tantis, for collection, and has agreed with him to pay to him 10 per cent, attorneys’ fees provided for in said notes, which it says is a reasonable charge for such service.”

In Lanier v. Jones, 104 Tex. 247, 136 S. W. 255, and also in First Nat. Bank of Eagle Lake v. Robinson, 104 Tex. 166, 135 S. W. 372, it was expressly held by our Supreme Court that, in the absence of a plea and proof that the attorney’s fee provided for in a promissory note is unreasonable, the court is authorized to enter judgment for the full sum of attorneys’ fees stipulated in the note. Instead of contesting the- reasonableness of the attorneys’ fees provided for in the notes in the present suit, the plaintiff in error confessed the truth of the allegations quoted above by suffering a judgment against him by default, and clearly he is in no position to complain here that the court erred in giving judgment for such attorneys’ fees.

For the reasons noted, the judgment is affirmed.
      <&=3For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: WILLSON, C. J.

license: Public Domain

text:
    DUNN v. EPPERSON et al.
    (No. 1420.)
    (Court of Civil Appeals of Texas. Texarkana.
    March 11, 1915.)
    Exceptions, Bill of &wkey;>59 — Correction— Necessity for Fraud of Mistake — Statute.
    Under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 2063, providing that it shall be the duty of the party taking a bill of exceptions to reduce it to writing, where from allegations in motions to correct bills of exception it appeared that they were made up by the attorney of the moving party, it not being alleged' that the defects were due to accident or mistake or to imposition practiced upon the moving party’s attorney in making up the bills, or on the judge who approved them, the action of the trial court in overruling the motions for correction was proper.
    TEd. Note. — For other cases, Bill of, Cent. Dig. §§ 106-111; 59.] see Exceptions, Dec. Dig.
    Appeal from District Court, Titus County; H. F. O’Neal, Judge.
    Action by B. H. Epperson and others against Gordon Dunn and others. From judgment sustaining exceptions of Epperson on motion to correct two bills of exception taken by him, defendant Dunn appeals.
    Affirmed.
    See, also, 175 S. W. 837.
    J. G. McGrady, of El Paso, for appellant. Lennox & Lennox, of Clarksville, for appel-lees.
   WILLSON, C. J.

This appeal is from a judgment sustaining exceptions of B. H. Ep-person and other of the appellees, who were plaintiffs in a suit of trespass to try title against appellant Dunn and appellees Fee, Jackson, and Stewart, to motions made by said Dunn to correct two bills of exception (numbered 3 and 4) taken by him and said Fee, Jackson, and Stewart to the action of the trial court in excluding as evidence a certain judgment and a deed offered by them to prove title in themselves to the land in controversy. The trial of the trespass to try title suit resulted in a judgment in favor of the plaintiffs for the land, and the judgment in that respect on appeal has been affirmed by this court in an opinion not yet published.

In one of the motions it was alleged that Dunn, Fee, Jackson, and Stewart “offered in evidence as a part of their defense a judgment rendered in justice court of precinct 3 of Marion county, Tex., March 29, 1880, in case styled W. L. Harris v. A. U. Wright, J. P. Russell, and R. B. Epperson, Executors of B. H. Epperson, Deceased, No. 2181, and the other entries on said justice docket,” to the admission of which the plaintiffs interposed specified objections: That the trial judge “did not then rule on the admissibility of the judgment, but permitted said defendants to read the same in evidence, said judge remarking at the time, in substance, ‘We will take it all together, and I will rule on it later’ ”; that the court did not rule on the admissibility of the judgment “until after all the testimony in said case had been introduced and the argument of counsel heard, and before said presiding judge had announced his decision on the merits in said case he announced his ruling on the admissibility of said judgment, by which he sustained said objections of plaintiffs, held said judgment inadmissible. and excluded same from the evidence, to which ruling said defendants then and there excepted.” It was next alleged that Dunn, Pee, Jackson, and Stewart prepared a bill of exceptions showing the action of the court, and presented same to plaintiffs’ attorneys, who “objected to some of the verbiage and prepared in lieu thereof bill of exception No. 3, filed herein, which was accepted by attorneys for these defendants as being sufficient, and it was approved by said judge and filed as aforesaid.” It was then alleged that at the time the bill was prepared the statement of facts had not been made up in full, and that:

“It was the intention of counsel for said defendants to have said statement of facts show the facts concerning the offering in evidence and reading said justice court judgment and subsequent exclusion of same from evidence, as set out above; they believing same a proper way to show to the court, on appeal by the record, the true facts of said trial.”

It was then alleged that Dunn and his co-defendants in a statement of facts they prepared “did set out the facts of offering said justice court judgment in evidence, set out said judgment by its tenor, and the statement of the court aforesaid that he would take it all together and rule on it later, and that later the court sustained said objections and excluded said judgment,” and that:

“Counsel for said defendants then presented said statement of facts to the attorneys for plaintiffs for approval, but when plaintiffs examined said statement of facts, they objected to being incorporated therein said proceedings relating to offering said judgment, its reading, remark, and ruling of the court thereon and exception taken, and in order to secure attorneys of plaintiffs signing said statement of facts, attorneys for defendants had to agree with plaintiffs’ attorneys for said proceedings to be stricken from said statement of facts relating to said judgment.”

It was then alleged:

“In the trial of said case and in preparing the record for appeal defendant Dunn had only one attorney acting for him, viz., J. A. Ward. Soon after said trial, and before said statement of facts was presented to plaintiffs’ attorneys, the son and partner of J. A. Ward happened to a fatal accident, and because of such distress to J. A. Ward and his immediate family he did not feel able to act further in preparing said record for appeal, and devolved his further duties in that regard upon the active attorney for said other defendants, who with J. A. Ward was making a common fight as against the plaintiffs.”

The prayer was for an order amending and correcting the bill of exceptions so it would show—

“that when defendants offered said justice court judgment in evidence the plaintiffs objected thereto, making the objections shown in said bill; that thereupon said presiding judge, Hon. H. E. O’Neal, remarked in substance, ‘We will take it all together, and I will rule on it later;’ that thereupon the defendants read said judgment and other entries on the justice docket in evidence; that the court did not make his ruling on the admissibility of said judgment until after all the testimony had been introduced and the argument concluded; that before the court announced his decision or judgment on the merits of the case, he announced his ruling on said objection and excluded said judgment from the evidence, to which ruling defendants then and there excepted.”

The bill of exceptions numbered 4 was taken to the action of the court in excluding a deed dated June 7, 1881, purporting to have been made by the sheriff of Titus county to Gulie Hargrove, and to convey the land in controversy. It contained a recital that plaintiffs objected thereto “on several grounds, among which were,” and then followed a statement specifying the grounds of the objection. By his other motion Dunn sought to have the word “among,” where it occurs in the quotation above, expunged from the bill. The allegations in this motion in other respects were substantially the same as those set out above as in the motion first referred to, except that it contained no allegations as to the making up of the statement of facts, and except that it was alleged therein that the recital in said bill that plaintiffs objected to the deed “on several grounds, ‘among’ which were,” etc., was false in the use of the word “among,” “for the truth is [quoting] the only objections made to said deed are those specifically set out in said bill of exceptions No. 4, whereas said bill by using the word ‘among’ leads to an inference, if not to a belief, that there were other objections made by plaintiffs to said deed besides those set out in said bill,” and except that it was also alleged therein that the attorney representing Dunn in the preparation of the bill was informed by plaintiffs’ attorney, when same was presented to him, that the bill as prepared “did not embody the objections made by plaintiffs to said deed as full and as formal” as he thought it should; that thereupon plaintiffs’ attorney prepared and presented to the attorney representing Dunn in the matter the bill of exceptions No. 4 it was sought by the motion to correct, “saying that he had written same substantially same as the one so presented to him, except that he had made the same show fully and truly the objections which plaintiffs made to the introduction of the sheriff’s deed”; that thereupon the attorney representing Dunn “hurriedly glanced over said bill, and relied upon said statement of said Bennox [plaintiffs’ attorney], and failed to discover said word ‘among’ therein, or if he did discover same, he did not realize its meaning and effect, and, believing that the true meaning of the reading of said bill meant that the objections therein set out were all the objections urged or made to the introduction of said deed, accepted same as correct, and had the Hon. H. F. O’Neal, the judge who tried said case, approve same, sign it, and then had it filed.” It was not alleged that the bill as prepared by Dunn’s attorney and as presented to plaintiffs’ attorney did not contain the word “among” in the place it appeared in the bill Dunn sought to have corrected.

We are of opinion the trial court did not err when he overruled the motions. It appears from the record in the trespass to try title suit that the bills of exceptions were approved and filed in the court below May 16, 1914, and that the transcript on the appeal of that suit was filed in this court July ■3, 1914. The motions were filed in the trial court October 10, 1914. From the allegations in the motions it appeared that the bills as approved and filed were made up by attorneys representing the parties, including appellant Dunn. It was not alleged that the absence in one of them of the recitals it was sought to add thereto, nor the presence in the other of the word objected to, was due to accident or mistake, or to imposition practiced on either the attorney representing Dunn in the making up of the bills, or on the judge who approved same. On the contrary, it appeared from the allegations that the bills were satisfactory to said attorney at the time they were made up, approved by the judge, and filed. Indeed, it seems from the allegations that at the time said attorney agreed to the bill covering the action of the court in excluding the judgment, he was mindful of the omission therefrom of the recitals it was sought by the motion' to add to it, and agreed to the bill as made because he thought any prejudicial effect such omission might have on Dunn’s rights would be overcome by recitals he expected the statement of facts to contain when settled and approved. That the expectation was not realized did not, we think, entitle Dunn to have the bill corrected as prayed for. To permit a litigant charged with the duty, as Dunn was, to reduce his bill of exceptions to writing (article 2063, Vernon’s Statutes), after he had done so and the bill had been approved as correct and filed as a part of the record, to change it by a proceeding of this-kind, without showing that it was materially wrong as the result of accident or mistake or fraud practiced, would result, it is believed, in endless confusion and delay in finally making up the record for an appellate court. It would mean that a litigant , who, exercising his own judgment, and uninfluenced by accident, mistake, or fraud, had included in his bill of exceptions everything he thought it should contain, if he afterwards concluded it should have contained matter he had chosen to omit when he prepared it, might, at any time before the cause was finally disposed of in the appellate court, have the omission supplied. And it would mean that a litigant whose duty it was to prepare such a bill could shut his eyes to what it contained when prepared, or if he read it to what the language used meant, agree to it as correct, have the judge approve it as such, have it filed as a part of the record, and then, at any time he might choose to do so before the appeal was finally disposed of, have parts of it stricken out, without showing any better reason why he should be allowed to do so than his own or his attorney’s carelessness. It is believed a litigant under such circumstances should be held to be bound by the record as made.

The judgment is affirmed.
      ©=»For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: BUCK, J.

text:
    COX et al. v. KEARBY.
    (No. 8128.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    March 13, 1915.
    On Motion for Rehearing, April 17, 1915.)
    1. MORTGAGES &wkey;>38 — ABSOLUTE DEEB — EVIDENCE.
    Evidence held to sustain a finding that a deed by a husband and wife, though absolute in form, was intended as a mortgage.
    [Ed. Note. — For other cases, see Mortgages, Cent. Dig. §§ 108-111; Dec. Dig. &wkey;38.]
    2. Vendor and Purchaser <&wkey;244 — Absolute Deed as Mortgage — Notice.
    Grantees in a deed held, under the evidence, to have notice that the grantor had title under a deed from' a husband and wife absolute in form, but intended as a mortgage.
    [Ed. Note. — For other cases, see Vendor and Purchaser, Cent. Dig. §§ 609-611; Dec. Dig. &wkey;>244.]
    3. Judgment <&wkey;787 — Bien — Constructive Notice.
    A judgment creditor has constructive notice of whatever rights prior purchasers from the debtor have, where the property is in possession of tenants who attorn to such purchasers.
    [Ed. Note. — For other cases, see Judgment, Cent. Dig. §§ 1361, 1363-1367; Dec. Dig. &wkey; 787.]
    4. Judgment <®=787 — Bien—Priority—Con-veyances.
    As against a judgment creditor, grantees in a deed from the debtor, absolute in form, but intended as a mortgage, who, at the instance and for the benefit of the grantor, conveyed the land prior to the attaching of the creditor’s lien, divests the title out of the debtor.
    [Ed. Note. — For other cases, see Judgment, Cent. Dig. §§ 1361, 1363-1367; Dec. Dig. &wkey; 787.]
    Appeal from District Court, Comanche County; J. H. Arnold, Judge.
    Suit by J. P. Kearby against B. B. Cox and others. From a decree for complainant, certain defendants appeal.
    Reversed and rendered.
    Smith & Palmer, of Comanche, for appellants. Goodson & Goodson and Kearby & Kearby, all of Comanche, for appellee.
   BUCK, J.

This suit was filed in the district court of Comanche county by plaintiff, J. P. Kearby, against J. G. Daniel and wife, B. B. Cox, and H. H. Stephenson, April 3, 1914. Plaintiff alleged the abstracting of two justice court judgments recovered by him, one in the principal sum of $121.60, abstracted March 6, 1914, and the other in the principal sum of $123.83, abstracted March 28,1914, both judgments being against defendant J. G. Daniel.

It was further alleged that said judgments were, and upon the abstracting thereof became, a valid and subsisting judgment lien in favor of plaintiff upon certain described real estate owned by J. G. Daniel and situated in the town of Gustine, Comanche county, said property being alleged to be no part of the homestead of said J. G. Daniel, and that, if it ever was a business homestead of said defendant Daniel, it ceased so to be, and became subject to the judgment lien aforesaid because of the abandonment as such business homestead by said Daniel prior to January 1, 1914. Plaintiff further alleged that D. B. Cox was claiming to own said property and H. H. Stephenson was claiming to own two vendor’s lien notes against said property in the sum of $250, each, said two claims being predicated upon a purported deed of conveyance of said property by J. P. Pettit & Co., a firm composed of J. P. and J. A. Pettit, said deed being executed about April SO, 1913, by said J. P. IPettit & Co. to said Cox and Stephenson, and a further purported deed of conveyance of said property by said Cox to said Stephenson, on or about January, 1914, wherein said Stephenson conveyed his interest therein to said defendant Cox, the two notes mentioned above being a part of the alleged consideration, and that neither of said deeds had ever been filed for record. Plaintiff further alleged that he had no knowledge or notice of the existence of either of said conveyances until long subsequent to the filing and recording of his said abstracts of judgment, and that, by virtue of the facts set forth, he was entitled to a foreclosure of said judgment lien as against said property and all of said defendants without regard to whether said two conveyances from J. P. Pettit & Co. to Cox and •Stephenson and from Cox to Stephenson existed in fact or not, and that he was entitled to a decree canceling said deeds, if any, in so far as his rights were concerned, for which he prayed. He further pleaded, in the alternative, that the purported conveyance of said property by J. G. Daniel to J. P. Pettit & Co. was not a deed, as it purported to be, but, in truth and in fact, was but a mortgage, and was given for the purpose of securing the said J. p. Pettit & Co. in a loan to the said J. G. Daniel, and that at the time of the execution of said purported conveyance from Daniel to J. P. Pettit & Co. said property was the business homestead of said defendant Daniel, and that such mortgage was wholly void and inoperative to pass any title whatever out of the said J. G. Daniel, and that said defendants Cox and Stephenson had full notice and knowledge of the true facts relative to said purported conveyance by Daniel to the said J. P. Pettit & Co., and had actual and constructive notice that the same was a mortgage, and that the property was the homestead of the defendant J. G. Daniel, and that the purported deed, if any, of said J. P. Pettit & Co. to Cox and Stephenson and the said purported deed from Stephenson to Cox conveyed no title whatever, and that the alleged vendor’s lien notes were wholly void and invalid as to the plaintiff, and that said conveyances, and each of them, were made for the purpose of placing the property of the said J. G. Daniel beyond the reach of his creditors, and were given with the intent to delay, hinder, and defraud the creditors of said J. G. Daniel, and to cover up said property so that the same could not be reached by the creditors of said Daniel, and that at the time of the conveyance from J. P. Pettit & Co. to Stephenson and Cox, and that at all times since then, the plaintiff had been a creditor of said defendant Daniel, evidenced by the two notes upon which said two judgments aforesaid were founded, and that each of said defendants had notice of the fraud rendering void the title of such bank and of those claiming under and by virtue of such purported conveyance to the bank, and that at the time of such conveyance the said defendant J. G. Daniel was insolvent, and had no other property subject to execution sufficient to pay his debts.

In answer to plaintiff’s petition, the defendants Cox and Stephenson, after general denial and general demurrer, and after denying that judgment of plaintiff constituted a valid and subsisting judgment lien against the property described, alleged that the conveyance by J. P. Pettit & Co. to Cox and Stephenson was made at the instance and request of J. G. Daniel, and that said J. P. IPettit & Co. conveyed whatever interest said J. G. Daniel and wife had in said property at the time of said conveyance, whether said conveyance from J. G. Daniel and wife to said J. P. Pettit & Co. was intended and was, in fact, a mortgage, or was a conditional sale, subject only to the right on the part of J. G. Daniel and wife of repurchase; that said conveyance by J. G. Daniel to J. P. Pettit & Co. on its face purported to be a regular warranty deed, and, if there were any facts existing which made said deed null and void, the defendants Cox and Stephenson were ignorant of the existence of the same, and bought the property in good faith, and that at the time of the conveyance by J. P. Pettit & Co. to defendants Cox and Stephenson the property in question was not the business homestead of the defendant Daniel, and that said J. P. Pettit & Co. conveyed said property to the defendants Cox and Stephenson as the agent of said J. G. Daniel. They denied that said Daniel made the conveyance to J. P. Pettit & Co., and through them to Cox and Stephenson, for the purpose of defrauding his creditors, but, on the contrary, for the purpose of paying his creditors, and they further denied that at the time of the last-named conveyance said Daniel was insolvent, or that they had any notice of his insolvency, if he was insolvent. They further denied that at the time of the filing of said purported abstracts of judgment by the plaintiff the defendant Daniel had any legal or equitable title to said property to which said purported lien could attach, whereupon they prayed judgment.

The case was tried before the court without the intervention of a jury, and judgment was given for plaintiff, fixing and decreeing the lien claimed by plaintiff against said property against all of the said defendants for the aggregate amount of said two judgments, to wit, $250.93, as such lien existed on the 28th dáy of March, 1914, and canceling and annulling all homestead claims on the part of J. G. Daniel and wife against and to said property, from which judgment H. H. Stephenson and L. B. Gox have appealed. J. G. Daniel and wife made no appearance in the trial court.

The evidence established the following facts not included in the findings of fact filed by the court, to wit: That the judgments in favor of the plaintiff were based upon two notes executed by J. G. Daniel to plaintiff, and that said two judgments were filed for record in the judgment record of Comanche county, the first on March 6, 1914, and the second on February 28,1914; that the instruments of conveyance from J. G. Daniel and wife to J. P. Pettit & Co. were for the purpose of securing said J. P. Pettit & Co., bankers, in the payment of certain indebtedness due by said J. G. Daniel to said bankers, amounting to about $175 or $200; that at the time of the conveyance to Cox and Stephenson said Daniel, who was a doctor, was indebted for a fine to Comanche county in the sum of $385, and to various other parties in sundry amounts, aggregating within $140 of the purchase price claimed to have been paid by Cox and Stephenson, to wit, $1,200, all of which debts were assumed by Cox and Stephenson; 'that said Dr. Daniel had gone through bankruptcy proceedings, and had this property which was used as a drug store and occupied in part by Duke & Co., and also as an office for said Dr. Daniel, set apart to him as a business homestead; that the license of Dr. Daniel was forfeited by a judgment of the district court of Comanche county on November 4, 1912; that neither the deed from J. P. Pettit & Co. to Cox and Stephenson nor the one from Stephenson to Cox conveying a one-half undivided interest had been recorded at the time of the trial, though the instrument of conveyance from Daniel and wife to J. P. Pettit & Co., dated April 18, 1912, was filed for record the 15th day of July, 1912. The deed from Pettit & Co. to Cox and Stephenson was dated April 30, 1913, and that from Stephenson to Cox was dated January 19, 1914. The court filed its findings of fact and conclusions of law as follows:

' “I find that the instrument in writing exhibited in evidence, and executed by J. G. Daniel and wife to the bank at Gustine, while in form of a deed, was, in truth and in fact, a mortgage, and such was the intention of the parties thereto, and that the defendants had actual notice of the intention of the parties to the transaction and its real character at the time they took the deed from the bank to the property in question.
“(2) I find that the bank in question did not act as Daniel’s agent in making the deed to the defendants Cox and Stephenson, but that such deed was made by the bank because the parties erroneously assumed that the bank was the proper vendor, and that its conveyance would invest title in defendants.
“(3) I find that at the time of the transaction between Daniel and the bank the property in question was the business homestead of Daniel, and that it continued to be his business homestead up until the date his license to practice medicine was .canceled, which was prior to the sale of the property to Cox and Stephenson, and that on the date of the last-named transaction the property was not Daniel’s business homestead.
“(4) I find that Cox and Stephenson did not record the deed from the bank to them prior to the institution of this suit, and that Daniel did not execute any deed to them before this suit was filed, though he did so on the day of the trial, and the same was exhibited in evidence, but that the plaintiff had no notice, actual or constructive, of the defendants’ rights or the nature of their dealings with the bank or Daniel at the time he recovered and abstracted his judgments in question, and that he did not have such notice at the time this suit was filed, unless the fact that the tenant under Daniel, who continued to be their tenant after the transaction with Daniel, paid rent to them, instead of Daniel, after said transaction, was sufficient to-affect him with notice. In this connection I find that Daniel was in possession up until the transaction with the defendants was had by tenant, and that the same tenant continued in possession of the property after' the deal with Daniel, and paid rents to the defendants Cox and Stephenson. I find that the deal between Daniel and the other defendants was in parol, and no memoranda in writing was made thereof.
“(5) I find that there was no actual fraud in the transaction between Daniel and the defendants Cox and Stephenson, and no constructive fraud, unless it be in the fact that the portion of the consideration that was to be paid by Cox, Daniel’s son-in-law, was the assumption to pay debts due by Daniel for which Cox was already liable as a surety for Daniel. As to the portion . of the debts which Stephenson agreed to-pay, he was not previously liable therefor. The effect of the transaction was to make Cox a preferred creditor of Daniel, and to deny the plaintiff participation in the proceeds of the sale of the property in question along with Daniel’s other creditors.
“Conclusions of Daw.
“I find that the deed of Daniel and his wife to the bank was intended by the parties to be a security for debt, and that it was only in effect a mortgage, the property therein contained being a business homestead of Daniel, all of which was well known to Cox and Stephenson, and that therefore the same was void.
“(2) I find that, by reason of all the facts in this case, title to the land in controversy had never passed out of Daniel prior to the date of the deed executed by him during the trial of this case, and that prior thereto plaintiff’s judgment lien had attached to the property, and that he is entitled to have the same foreclosed. In this connection I desire to observe, that I do not give any effect to the bank’s deed to the defendants, for the reason that, the transaction between said bank and Daniel, being void, said bank had no title it could convey to another. It could convey no greater title than it had, and,, having no title, it could convey none. The familiar axiom ‘that a fountain can rise no higher than its source’ seems to me to be applicable here. I further find that, by reason of all the facts in this case, the defendants were not in a position to enfoi’ce specific performance of their contract with Daniel prior to the filing of this suit; the same not being in writing, and no improvements on the property being alleged nor proven, and it not being answered that Daniel was insolvent.
“(3) Eor all the reasons above stated, judgment will be rendered in favor of the plaintiff as prayed for in his petition.”

The assignments of error urged by appellants are directed against the correctness of such findings and conclusions.

The theory upon which plaintiff sought a judgment fixing his lien and decreeing the sale of said property to satisfy his judgments was that the purported conveyance by Dr. Daniel and wife to J. P. Pettit & Co. was void, because at the time of such conveyance said property was, in fact, used by’ said Dr. Daniel as a business homestead, and that thereby no title or interest in and to said property was conveyed out of said Dr. Daniel and wife, nor was any vested in said J. - P. Pettit & Co. which they could convey to Cox and Stephenson, and that, since the instruments of conveyance to Cox and Stephenson and from Stephenson to Cox were not of record, they constituted no notice to the plaintiff of any such attempted conveyance, and that he, in fact, had no notice, either actual or constructive, of such attempted conveyance prior to the abstracting of his judgments, and that thereupon his lien became fixed as against said property.

The theory of the defendants was: (1) That the conveyance by Dr. Daniel and wife to J. P. Pettit & Co. was not a mortgage or deed of trust, but was a conditional sale, and, as such, conveyed whatever title the grantors had in the property to the grantee; and (2) that, if such instrument be held as a deed of trust or mortgage, thereupon J. P. Pettit & Co. became the agent and representative of J. G. Daniel and wife for the further conveyance of said property to Cox and Stephenson, and that in executing said conveyance as such agent and representative, and at the instance and request of Dr. Daniel and wife, said banking firm conveyed all of the title and interest that was held either by J. P. Pettit & Co. or Dr. Daniel and wife, and that, since said Cox and Stephenson had no notice of the existence of the indebtedness by said Dr. Daniel to the plaintiff prior to the abstracting of his judgments, said last-named grantees took all the title to said property free of any valid claim or lien that could be enforced by said plaintiff.

We think the facts sufficiently sustain the findings of the court to the effect that the instrument of conveyance by J. G. Daniel and wife to J. P. Pettit & Co. was, in truth and in fact, a mortgage, and such was the intention of the parties thereto, and that the defendants Cox and Stephenson had actual notice of the intention of the parties to the transaction and the real character of said transaction at the time they took the deed from the bank to the property in question. The evidence shows without controversy that upon the execution of the conveyance by J. P. Pettit & Co. to Cox and Stephenson the*Duke Drug Company, which was occupying the main portion of the building, paid rent to said Cox and Stephenson, and that said Cox and Stephenson had possession of said property thereafter and by their tenant, who attorned to them, and that said Duke Drug Company was in possession of said building as tenants of Cox and Stephenson first, and later of Cox, up to a short time before the trial. Therefore it should be said that it is established without controversy that the plaintiff had constructive notice of the possession of said Cox and Stephenson of the premises in controversy through the tenant, and of whatever right in the property Cox and Stephenson, in fact, had. Collum v. Sanger Bros., 98 Tex. 162, 82 S. W. 459, 83 S. W. 184; Mainwarring v. Templeman, 51 Tex. 205; Watkins v. Edwards, 23 Tex. 443; Woodson v. Collin & Douglass, 56 Tex. 168.

The questions, then, for our consideration in the face of the uncontroverted testimony and the facts found by the court are: (1) Did the conveyance by Dr. J. G. Daniel and wife to the bank, whether such conveyance be intended as a mortgage or conditional sale, divest the title out of said Dr. Daniel and wife? (2) If it did not divest the title out of Dr. Daniel and wife, did the subsequent conveyance by the bank to Cox and Stephenson, made at the instance and request of said Dr. Daniel, divest title out of said Dr. Daniel and wife?

In answer to the questions suggested, we think that the facts amply sustain the Undoing of the court below that the conveyance by Dr. Daniel and wife to the bank was, and was intended to be by the parties to the transaction, a mortgage; hence it did not divest the actual title out of Dr. Daniel and wife. But said banking firm, J. P. Pettit & Co., did have the paper title, and, as such holder, might be said to hold siich title as the trustee of Dr. Daniel and wife. The subsequent conveyance by the bank, prior to the attachment of plaintiff’s judgment lien, if any, made at the instance of Dr. Daniel, and for his benefit, conveyed, at least by way of estoppel, whatever title or equity he had in the property, and, the court having found that the property was not the business homestead of Dr. Daniel at the time, it divested the title out of Dr. Daniel, despite the mortgage character of the previous conveyance to the bank. See Marler v. Handy, 88 Tex. 421, 31 S. W. 636; Irion v. Mills, 41 Tex. 310; and the recent case of Randleman v. Cargile et al., 163 S. W. 350.

Therefore we hold that the cause should be reversed, and here rendered in favor of Cox for the title and possession of the prop1-erty, and in favor of Stephenson establish-. ing the superiority of bis vendor’s lien over plaintiff's judgment lien.

On Motion for Rebearing.

In O’Neal v. Busb & Tillar, 173 S. W. 869, tlie Supreme Court bolds that one in whom vests the legal title may pass the equitable title held by another, with the latter’s consent, by conveyance of bis own legal title. Likewise we think that one who bolds the record or paper title, though the instrument by which he purports to so hold is inoperative to vest the real or equitable title in him and divest the title out of his apparent grantor, may, by a conveyance of his apparL ent title, made with the consent and for the benefit of his grantor, who holds the real or equitable title, divest the title out of his grantor.

Upon the question of constructive notice of title or claim to title arising by virtue of possession by tenant, even though there has been no change in tenant after the execution of the instrument of conveyance by which the holder of possession claims, see Duncan v. Matula, 26 S. W. 638; Mattfeld v. Huntington, 17 Tex. Civ. App. 716, 43 S. W. 53; Smith v. James, 22 Tex. Civ. App. 154, 54 S. W. 41.

Appellee’s motion for rehearing is overruled.
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author: CONNER, C. J.

text:
    WIGGINS, et al. v. FIRST NAT. BANK OF DENTON.
    (No. 8125.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    March 13, 1915.
    Rehearing Denied April 17, 1915.)
    1. Appeal and Error <&wkey;916 — -Peesumptions —Pleading to Support Judgment.
    Rev. St. 1911, art. 1812, provides that civil suits shall be commenced by petition, and article 2157 et. seq. prescribes the manner- of supplying necessary pleadings lost at the time of rendering judgment. The original transcript on appeal contained no pleading, but contained the clerk’s recital that the pleadings had been lost, which, on motion, was stricken, and a supplemental transcript contained what was certified as a correct and true codv of the original petition, not shown to have been before the court at its rendition of judgment. but which was sufficient in terms to support the judgment. Held, that it would be assumed that the court below had the petition before it when it rendered judgment.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3699-3705; Dec. Dig. <S&wkey; 916.1
    2. Appeal and Error <&wkey;916 — Burden of Proof — Absence of Pleading to Support Judgment.
    Appellant, complaining of the absence of any petition to support the judgment rendered for plaintiff, had the burden .of establishing the fact upon which he relied to show the error.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3699-3705; Dec. Dig. <S&wkey; 916.]
    3. Pleading <&wkey;406 — Objections—Waives— Judgment by Confession — Effect.
    A judgment reciting an appearance of defendant and his withdrawal of his answer is in the nature of a judgment by confession, and operates as a waiver of all errors not fundamental or jurisdictional; and an objection merely that the trial court at the time of rendition of the judgment did not have before him a pleading sufficient to support the iudgment was not jurisdictional, but amounted to more than a mere irregularity.
    [Ed. Note. — For other eases, see Pleading, Cent. Dig. §§ 1355-1359, 1361-1365, 1367-1374, 1386; Dec. Dig. &wkey;>406.1
    Error from District Court, Tarrant County; Marvin H. Brown, Judge.
    Action by the First National Bank of Denton against John L. Wiggins and others. Judgment for plaintiff, and defendants bring error.
    Affirmed.
    H. R. Bondies, of Sweetwater, for plaintiffs in error. Slay & Simon, of Ft. Worth, for defendant in error.
   CONNER, C. J.

Plaintiffs in error, John L. Wiggins and others, complain of a judgment against them in favor of the First National Bank of Denton, defendant in error, for the sum of $579.80.

The judgment complained of reads:

“First National Bank of Denton v. John L. Wiggins et al. No. 36032.
“Judgment. May 9, A. D. 1914.
“On this day came on to be heard the above numbered and entitled cause, and plaintiff appeared by attorney and announced ready for trial, and defendants, though duly cited, failed to appear, but wholly made default, having withdrawn their appearance and answer heretofore filed in said cause; and, it appearing to the court that plaintiffs cause of action liquidated and proven by an instrument in writing, and that plaintiff is entitled to recover of and from defendants, jointly and severally, the sum of $579.90:
“It is therefore ordered and decreed that plaintiff. First National Bank of Denton, a banking corporation, do have and recover of and from the defendants, John L. Wiggins, R. L. McCauliey, Thos. Trammell, and Thos. F. Hodge, jointly and severally, the sum of $579.-80, with interest thereon at the rate of 10 per cent, per annum from this date, together with its costs in this behalf expended, for which let execution issue.”

But two assignments of error are presented. The first — and. the second is substantially the same — is that “the court erred in rendering judgment in favor of the plaintiff and against the defendants without proper pleadings then before it to sustain the same”; the proposition being that “the court is without power to proceed in a case and to render judgment in favor of the plaintiff where the petition is lost until such pleading is properly substituted.”

Revised Statutes 1911, art. 1812, provides that:

“All civil suits in the district and county courts shall be commenced by petition filed in the office of the clerk of such court.”

It will be thus seen that in our practice the foundation of every civil suit is the filing of a petition, from which it would seem to necessarily follow that no judgment should be rendered in any civil case in the courts named except upon petition which had theretofore been duly filed. See Montgomery v. Barnett, 8 Tex. 143; Watson v. Miller Bros., 69 Tex. 176, 6 S. W. 680; Crosby v. Di Palma, 141 S. W. 321. In cases provided for by our statute where Judgment is rendered upon confession, it is necessary that the petition shall be “sworn to by the person in whose favor the judgment is confessed.” Revised Statutes 1911, art. 2007. A further inference is that in any such case the petition should be before the court at the time of the rendition of the judgment, to the end that the court may see that the relief afforded is supported by the pleadings. Should it happen in any. case that any necessary pleading is “lost” at the time of the rendition of the judgment, it may be supplied in the manner pointed out by the statutes by either party on motion before the court upon three days’ notice to the adverse party or his attorney. See Revised Statutes 1911, art. 2157 ■et seq. So that' we would feel little or no hesitation in reversing the judgment under consideration, if, from the record, plaintiffs in error’s assignments and proposition were sufficiently supported.

As originally filed in this court, the transcript contained no pleading of any character, but had a recitation by the clerk styled a “preamble” which reads:

“The pleadings and citations in this cause have been lost and inaccessible for any purpose whatsoever since prior to May 9, 1914, and were not available, but were lost when judgment was rendered herein; and, after diligent search and inquiry made of counsel, the .only papers which can be found are those following, to wit.”

It is this recitation upon which evidently the original complaint of the judgment rested. But, upon motion duly filed by appellee on a former day of this court, the recitation was ordered to be stricken from the record; we being of opinion that the facts recited could not be so shown here. At a later date appellee filed its motion for certiorari to correct the record, which was granted. The corrected record or supplemental transcript contains what the clerk certifies to be “a true and correct copy of plaintiff’s original petition as the same appears on file in my said office.” Plaintiff in error objected to this ■copy on the ground that no file marks appeared thereon, and there was nothing in the additional transcript to show that it had 'been present at the time of the rendition of the judgment herein. But we were of opinion that the failure of the clerk in making the transcript to indorse upon the margin the style of the pleading and the date of the filing constituted mere irregularities, and that, in the absence of a showing to the contrary, we must assume from the clerk’s certificate that the original petition appeared on file in his office. The objections to the supplemental transcript were therefore overruled, and its filing granted as before stated.

The original petition presented in the supplemental transcript is sufficient in terms to support the judgment rendered, and there is no contention to the contrary made. It is true that nothing upon the face of the petition or of the judgment shows that the court had before him the petition at the time judgment was rendered; yet, in the absence of a legal showing to the contrary, we think we must assume that the court below had the petition before him at the time, the very familiar rule being that all presumptions will be indulged in favor of the right action of the court; and this is particularly true, we think, where, as here, the burden is upon the party complaining to establish the fact upon which he relies to show the error. Laird v. State, 15 Tex. 317; Lindly v. Lindly, 102 Tex. 143, 113 S. W. 750; Arnold v. Hockney Bros., 51 Tex. 46.

Judgments reciting, as here, an appearance on the part of defendants and a withdrawal by them of their answer are in the nature of judgments by confession, and operate as a waiver of all errors not fundamental or jurisdictional in character. Reese v. Medlock, 27 Tex. 121, 84 Am. Dec. 611; Janson v. Bank of Republic, 48 Tex. 599. And a complaint, as here, not that there was no sufficient pleading in existence upon which a judgment could rest, but merely that the trial court at the time of the rendition of the judgment did not have such pleading before him, certainly cannot be held to be jurisdictional. As indicated, such practice ought by no means to be followed, but it may be well doubted whether it amounts to more than a mere irregularity.

We conclude that plaintiffs in error’s assignments of error must be overruled, and the judgment affirmed.
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author: CARL, J.

text:
    BUFFALO BAYOU CO. v. LORENTZ.
    (No. 5466.)
    (Court of Civil Appeals of Texas. San Antonio.
    April 7, 1915.)
    Appeal and Error <&wkey;>1135 — Failure to Show Fundamental Error— Aeeirmanoe. Where the court on appeal struck out the statement of facts and refused to reinstate it, the judgment will be affirmed, in the absence of fundamental error.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 4454, 4456; Dec. Dig. &wkey; 1135.]
    Appeal from Harris County Court, at Law; Clark C. Wren, Judge.
    Action between the Buffalo Bayou Company and H. Lorentz. From a judgment for the latter, the former appeals.
    Affirmed.
    John Charles Harris and Harris & Harris, all of Houston, for appellant. Thomas S. Taliaferro, of Houston, for appellee.
   CARL, J.

The statement of facts in this case was stricken out by the Galveston Gourt of Appeals, from which this case was transferred to this court, and on November 13, 1914, in a written opinion reported in 170 S. W. 1052, that court overruled a motion to reinstate said statement of facts. A second motion to reinstate such statement of facts has been filed in this court, which motion has this day been overruled.

Therefore, since there is no statement of facts in the record, and no fundamental error appears, the judgment of the trial court will be affirmed.

Judgment affirmed.
      <§=»For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: DUNKLIN, J.

text:
    FLOORE et al. v. MORGAN et al.
    (No. 8190.)
    (Court of Civil Appeals of Texas. Ft. Worth.
    Feb. 27, 1915.
    Rehearing Denied April 3, 1915.)
    1. Corporations <&wkey;553 — RECEIVERSHIP — Equitable Grounds.
    To show grounds for receivership of a corporation, equities must appear in behalf of complainant which require that relief independent of a showing of insolvency.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2201-2216; Dec. Dig. &wkey;553.]
    2. Corporations <&wkey;557 — Dissolution—Notice of Application.
    A corporation having joined a plaintiff in a suit for dissolution, its statutory right, under Vernon’s Sayles Ann. Civ. St. 1914, art. 1203, to be served within 10 days’ notice of the application, is waived.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2227, 2228, 2230-2236; Dec. Dig. &wkey;557.]
    3. Appeal and Error <&wkey;920 — Review—Presumptions.
    In construing an order appealed from, every reasonable presumption must be indulged in its support.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3714-3721; Dec. Dig. &wkey;> 920.]
    4. Mortgages <&wkey;338 — Foreclosure Sale— Injunction.
    An unpropitious market is not sufficient ground for enjoining a foreclosure sale.
    [Ed. Note. — For other. eases, see Mortgages, Cent. Dig. §§ 1026-1035; Dec. Dig. &wkey;338.]
    5. Corporations <@=>556 — Application for Receiver.
    The prohibition in Vernon’s Sayles’ Ann. Civ. St. 1914, art. 2154, of application by a corporation for a receiver applies to its directors acting in its behalf.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2219-2226; Dec. Dig. &wkey;556.]
    6. Corporations t&wkey;>553 — Receivership — Equitable Grounds.
    That defendants in a suit for receivership would collect attorney’s fees and trustee’s fees provided for in notes and trust deeds of corporate property, alleged to be unreasonable, is not an equitable ground for a receivership.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2201-2216; Dee. Dig. &wkey;553J
    7. Corporations <@=>481, 557 — Receivership —Injunction against Foreclosure.
    In a suit for receivership of a corporation, and for an injunction against a sale on foreclosure of a first lien against its property, an allegation that it would not sell for its full value by reason of uncertainty of title due to other-claims, unpaid judgments, and suits against it, is insufficient for appointment of a receiver, or for the injunction, because the facts on which the conclusion is based would not affect the bid of any reasonable buyer.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1876, 2227, 2228, 2230-2236; Dec. Dig. <§=»481, 557.]
    8. Pleading <@=>8 — Conclusion of Pleader —Foreclosure Sale — Injunction.
    In a suit to enjoin a foreclosure sale, the mere conclusion of a pleader that the property would not bring its full value cannot be considered, in absence of facts alleged reasonably tending to support it.
    [Ed. Note. — For other cases, see Pleading, Cent. Dig. §§ 12-28%, 68; Dec. Dig. &wkey;8.]
    9. Corporations <@=>557 — Receiver — Petition.
    It is an objection to a petition for the appointment of a receiver of a corporation that it does not show that the receiver could care for its property better than could be done by its officers as trustees, pursuant to Vernon’s Sayles’ Ann. Civ. St. 1914, art. 1206.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 2227, 2228, 2230-2236; Dec. Dig. <@=>557.]
    Appeal from. District Court, Johnson County ; O. L. Lockett, Judge.
    Suit by A. M. Morgan and others against John W. Floore and another. From orders appointing a receiver and granting an injunction, defendants appeal.
    Reversed.
    S. C. Padelford, of Cleburne, for appellants. Walker & Baker, of Cleburne, for appellees.
   DUNKLIN, J.

This suit was instituted on January 5, 1915, in the district court of Johnson county against John W. Floore and W. B. Harrell by A. M. Morgan, S. T. Shaw, Ira C. Morgan, and Brown Douglass, directors of the Cleburne Street Railway Company, and by A. M. Morgan individually, to enjoin the sale of the entire line of street railway owned by the said company, as well as the equipments used in operating the same.

It was alleged in the petition that the defendant John W. Floore was the owner of four certain promissory notes, the principals of which aggregated about $18,000, and secured by deeds of trust executed by the company, in which the defendant W. B. Harrell was named as trustee, .and by the terms of which instruments the trustee was authorized, after giving notice as provided by the laws of the state of Texas, to sell the property covered by the deeds of trust, at public auction to the highest bidder at the courthouse in Johnson county. It was further alleged that the notes so held by the defendant Floore, together with interest accuring thereon, were past due, and that the trustee had advertised the property for sale in accordance with the terms of the deeds of trust. It was further alleged that unless restrained the trustee would, on January 5, 1915, the same day the suit was instituted, sell said property in accordance with the advertisement he had already made. According to further allegations in the petition, plaintiffs A. M. and Ira 0. Morgan, Sliavr, and Douglass, and the defendant Eloore are the duly elected, qualified, and acting directors of said corporation. The deeds of trust in favor of Eloore had all been duly recorded and in addition to- those deeds of trust the company had executed three other deeds of trust, covering the same property included in Moore’s deeds of trust, one to secure the payment of a promissory note for $15,000 in favor of the National Bank of Commerce of Dallas, another to secure the payment of a note in the principal sum of $3,000 in favor of the same bank, and still another to secure the payment of a promissory note in the sum of $1,500 in favor of the plaintiff A. M. Morgan, all of which deeds of trust have been duly recorded in Johnson county, and all of the notes secured thereby were due and unpaid.

It was further alleged in the petition that the company was indebted to divers and sundry persons for supplies, material, and labor furnished in the operation of the railway in approximately $1,700; that the company was insolvent, and by reason of such insolvency had been, for several weeks, unable to operate its business, and that its properties were of the reasonable value of $35,000; that a financial depression now exists throughout the country on account of which it would be impossible to sell the property at the present time for even approximately its real value; that there are no prospective bidders for the property in the event of its sale as proposed by the defendants, and that in the event of such a sale, the creditors of the corporation other than the defendant Eloore would receive nothing upon their claims against the company; that the plaintiff directors of the company are now negotiating with other persons for the sale of the properties, and if defendants were restrained from, making the sale, said directors would be able, within 60 days to 90 days to find a purchaser at a price sufficient to liquidate all the debts of the corporation secured by liens and probably the unsecured debts as well; that the company also owes other debts, a list of which plaintiffs were unable to furnish, but that the total amount of all the debts owing by the company would be equal to the reasonable value of the property covered by the deeds of trust. It was further alleged that Eloore had placed the notes held by him in the hands of an attorney for collection, and is demanding the payment of the attorney’s fees provided for in the notes in the sum of $1,000, as well as a fee of $300 to the trustee also provided for in the deeds of trust, which fees were alleged to be unreasonable, but which would be collected and appropriated by the said Eloore unless his proposed sale was enjoined.

It was further alleged that by reason of the insolvency of the company and its cessation of business its property had become a trust fund in the hands of its directors, and that the defendant Eloore, one of the directors, had refused to join with the other directors in the institution of the suit. Plaintiff A. M. Morgan also prayed for a judgment for the amount of his debt, with foreclosure of his lien against the properties covered by the deed of trust in his favor, and in the concluding paragraph of the petition plaintiffs all prayed that the defendants be enjoined from selling the property under said deeds of trust, that a receiver be appointed, and that all the properties of the corporation be sold by the court and the proceeds thereof distributed among the creditors of the corporation according to their respective rights and equities. The petition also prayed for general relief.

On the same day the original petition was filed, to wit, January 5, 1915, the following order was made by the judge of the district court:

“Oh this 5th day of January, 1915, came on to be heard the application of the plaintiffs for a restraining order and for the appointment of a receiver; the defendants, after being duly notified, appeared in person and by attorney, and requested the court to continue the hearing on the application until Friday, January 8, 1915. It is therefore ordered that the hearing on the application be postponed until January 8, 1915, and that the defendants be, and they are, hereby ordered to refrain from selling the property of the Cleburne Street Railway Company under either of the deeds of trust until further order of this court.
“[Signed] O. L. Lockett, Judge.”

On January 8, 1915, the defendants filed their original answer to the petition, consisting of a general denial and numerous special exceptions to the petition, and denying divers and sundry allegations of fact contained in the petition. On January 9, 1915, pláintiffs filed an amended petition, alleging, substantially, the same facts as contained in the original petition with the following addition: The Cleburne Street Railway Company was made a coplaintiff with the original plaintiffs. In the amended petition it was further alleged that plaintiff A. M. Morgan had guaranteed the payment of the indebtedness of the corporation to the National Bank of Commerce, aggregating the sum of $18,000, which he was unable to pay at the present time, although he owned property worth the amount of said indebtedness, which would be subject to the payment of said debts, and which would be lost to him in the event of the proposed sale by the defendants, by reason of the fact that the property covered by the defendant’s deeds of trust would be sold at a sacrifice; that a suit is now pending against the company in which A. C. Barber, as plaintiff therein, is claiming an indebtedness against the company in the sum of $1,800, and- a furnisher’s lien upon a part of the property to secure the same, which he was seeking to foreclose; that two other judgments aggregating approximately $1,000 against the company were also outstanding and unpaid; that by reason of said suits and the numerous claims mentioned already, an uncertainty existed as to the character of title that could be conveyed by the trustee under the proposed sale, and such uncertainty of title would cause the property to he sold for a sum less than could be realized by the sale of the same property, under orders of the court, after a receiver had been appointed. It was further alleged in the amended petition that plaintiffs A. M. and Ira O. Morgan, Shaw, and Douglass owned more than 25 per cent, of the stock of the corporation, and that they sue as such stockholders of the corporation. The amended petition concluded with a prayer for the injunction and the appointment of a receiver, as did the original petition. On January 9, 1915, the judge of the district court entered an order reciting that the original petition came on for hearing; that thereupon plaintiffs were given leave to file their first amended petition in lieu of their original petition to which the defendants excepted; that thereupon the amended petition and defendants’ answer thereto were heard and considered, all parties appearing. After such recitals the following appears in the order:

“And after due consideration the court finds that the material allegations of the plaintiffs first amended original petition are true, and that a necessity exists for the appointment of a receiver as prayed for. This application is not granted at the request of the Cleburne Street Railway Company, but on the application of the other parties. It is therefore ordered, adjudged, and decreed by the court that C. H. Warren, a citizen of Cleburne, Johnson county, Tex., who is in every way qualified to act as such receiver, be and he is hereby appointed receiver of all the property of the Cleburne Street Railway Company, including- its real and personal property, ehoses in action, franchises, and rights of every character, and his bond is hereby fixed in the sum of $2,500.”

Then follows a direction to the receiver, as soon as he has qualified as-such, to take possession of all the property of the company, and that as soon as possible file an inventory thereof, and that he take care of and preserve the property—

“and the parties to this suit are hereby commanded to surrender and place in the possession of said receiver all the property, rights, and franchises aforesaid, and that they and each of them, their agents and employes, are hereby enjoined from in any way interfering with the .said C. H. Warren in executing the powers and duties hereby conferred upon him as such receiver.”

The power to take care of and preserve the property was the only power conferred upon the receiver relative thereto. Prom that order the defendants have prosecuted this appeal.

Mr. High in his valuable work on Injunctions, after announcing the general rule to be that a court of equity will not interfere by injunction to prevent the foreclosure of a mortgage, in the absence of exceptional equities in behalf of the complainant (see 1 High on Injunctions, §§ 443, 444), in section 454 uses the following language:

“The fact that the time of the sale of lands under a trust deed is unpropitious, that money is 'scarce, and that, owing to the terms exacted, the sale will be attended with great, if not irreparable, loss to the owner of the property affords no ground for enjoining the sale. And in the absence of fraud or collusion on the part of the mortgagee, the mortgagor cannot enjoin a sale under a power, upon the ground that the sale would be unpropitious, or that it is to be made at an undervaluation.”1

In section 443 the same author further announces the general rule that one who seeks to enjoin the sale of property under a mortgage cannot have that relief in the absence of an offer to pay the debt secured. To the same effect see Powell v. Woodbury, 85 Vt. 504, 83 Atl. 542, Ann. Cas. 1914B, 606; Tooke v. Newman, 75 Ill. 215. No doubt some exceptional equities in behalf of the complainant may furnish an exception to that genferal rule.

By article 2154, Vernon’s Sayles’ Tex. Civ. Stat., the appointment of a receiver of property belonging to a corporation upon the application of the corporation itself is expressly prohibited. By article 1201, Vernon’s Sayles’ Tex. Civ. Stat., it is made unlawful for an insolvent corporation to do business within this state, and by article 1203, the right is given to the holders of 25 per cent, of the capital stock of an insolvent corporation to institute and prosecute a suit for the dissolution of the corporation, But it is expressly provided in that article that before any such petition is filed, leave therefor shall be first procured from the presiding judge of the court in which the proceeding is to be instituted, and, further, that any such corporation so proceeded against shall have 10 full days’ notice prior to the day set for the hearing on the application for the appointment of a receiver. The article last mentioned does not expressly provide that the insolvency of a corporation shall be a ground for the appointment of a receiver, even in a suit by the stockholders for a dissolution thereof. Neither by that statute, nor by any other statute, is the mere insolvency of a- corporation made a sufficient ground for the appointment of a receiver.

It has been settled by numerous decisions of this state that in order to show a sufficient ground for the receivership, equities must appear -in behalf of the complainant which require that relief, independent of a showing, that the corporation is insolvent. Galvin v. McConnell, 53 Tex. Civ. App. 486, 117 S. W. 211; People’s Investment Co. v. Crawford, 45 S. W. 738.

The corporation itself having joined as a plaintiff in this suit, no doubt its statutory right to be served with 10 days’ notice prior to the hearing of the application was waived. Ripy v. Redwater Lbr. Co., 48 Tex. Civ. App. 311, 106 S. W. 474.

It will be noted that in the order appointing the receiver it is recited that such appointment was not made upon the application of the street car company, but upon the application of the other plaintiffs. It is also recited that the material allegations in the plaintiffs’ petition for the appointment of a receiver were found to he true. Just what allegations the court considered the material allegations does not appear, but in construing the order every reasonable presumption must be indulged to support the order,

As noted already, it is a well-settled rule that an unpropitious market for the sale of properties is no ground for enjoining the sale. The suit by the directors of the company was necessarily a suit in behalf of the company, and if the company itself is prohibited from suing for the appointment of a receiver, the same inhibition applies to the directors of the company acting in its behalf. The only other parties plaintiff to the suit were holders of 25 per cent, of the capital stock, and A. M. Morgan, the holder of an indebtedness against the corporation secured by a deed of trust.

The allegation that in the event of the proposed sale by the trustees, defendants would collect the attorney’s fees and trustee’s fees provided for in the notes and deeds of trust, and which were alleged to be unreasonable, clearly is not an equitable ground for a receivership. Indeed, in the statement contained in appellees’ brief of the grounds for the receivership relied on by them, that fact is not mentioned, thus indicating that they did not consider it material.

The further allegation that, on account of the uncertainty of the title, the property would not sell for its full value does not constitute an equity, in behalf of any of the plaintiffs, sufficient for the appointment of a receiver, nor for the issuance of an injunction, because the facts upon which that conclusion is stated would not affect any reasonable buyer in the price he would bid for the property. According to the allegations in the petition the defendant Eloore’s liens are prior and superior to all other liens against the company alleged in plaintiffs’ petition, and his deeds of trust were duly recorded, thus giving all subsequent creditors due notice thereof. The title of a purchaser from the trustee by sale under these instruments would be superior to all subsequent liens and claims, whether recorded or unrecorded, and such subsequent liens and claims would not even constitute a cloud upon the title of a purchaser at the sale proposed by the defendants. Ryburn v. Getzendaner, 1 Posey Unrep. Cas, 349; Spencer v. Rosenthall, 58 Tex. 4; Tex. L. & M. Co. v. Worsham, 5 Tex. Civ. App. 245, 23 S. W. 938. It must be presumed that any such purchaser would be properly advised of the title he would get should he purchase at such a sale.

It is well settled that the mere conclusion of the pleader that the property would not bring its full value at such a sale cannot be given any effect, in the absence of facts alleged which would reasonably tend to support that conclusion. 1 High on Injunctions, § 444; High on Receivers, § 17,

By article 1206, Vernon’s Sayles’ Tex. Civ. Stat., it is provided that upon the dissolution of any corporation, unless a receiver is appointed by some court of common jurisdiction, the president and directors or managers of the affairs of the corporation at the time of its dissolution shall be trustees of the creditors and stockholders of such corporation, with full power to settle the affairs, collect the outstanding debts, and divide the moneys and other property among the stockholders after paying the debts of the corporation, and to this end they are empowered in the name of the corporation to sell, convey, and transfer any property belonging to the company, to maintain and defend suits, and to exercise the same power and authority over the assets and property that the company itself could exercise. The only power given the receiver was to care for and preserve'the property placed in his hands, and that was the only immediate power which plaintiffs sought to have given the receiver, the allegations in the petition even negativing any specification that the receiver could ever operate the property. Even if the company should be dissolved at the suit of the stockholders, there is no showing in the petition that a receiver could care for and preserve the property in a better manner than can be done by the officers of the company named in the statute as trustees.

We are of the opinion that it reasonably appears from plaintiffs’ amended petition, read in the light of the original petition, that the injunction sought and granted was the principal purpose of the suit. But whether we are correct in this conclusion or not, for the reasons noted, the allegations contained in the plaintiffs’ petition, taken as true, furnish no sufficient reasons for the appointment of a receiver, nor for the issuance of a writ of injunction. Accordingly, the order appointing a receiver and the order granting the injunction against the defendants are vacated, and this order will be certified to the trial court for observance.
      <&wkey;>For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: PLEASANTS, C. J.

text:
    STRICKLAND et al. v. LAKESIDE IRR. CO.
    (No. 6965.)
    (Court of Civil Appeals of Texas. Galveston.
    March 19, 1915.)
    1. Statutes <&wkey;64—Levees—Effect of Partial Invalidity.
    Rev. St. 1911, tit. 83, c. 2, §§ 5530-5584, providing for improvement districts and construction of levees by such districts, is not wholly void because section 5569, providing that no county or district nor taxpayers therein shall be held for damages caused by construction, maintenance, or repair of levees or improvements, violates Const. art. 1, § 17, by taking or damaging property for public use without the owner’s consent and making adequate compensation, since the remainder of the statute is a useful and important piece of constructive legislation which it would be unreasonable to presume would not have been enacted if it were known' such .section could not be upheld as constitutional.
    [Ed. Note. — For other cases, see Statutes, Cent. Dig. §§ 58-66, 195; Dec. Dig. &wkey;64.]
    2. Statutes <&wkey;64 — Effect of Partial Invalidity.
    An act will not be held void in its entirety because one section or portion is unconstitutional, unless the void portion is so essential and necessary that it cannot be presumed the act would have been passed without incorporating it therein.
    [Ed. Note. — For. other cases, see Statutes, Cent. Dig. §§ 58-66, 195; Dec. Dig. &wkey;64.]
    3. Appeal and Error <&wkey;138 — Persons Entitled to Appeal—Attorneys.
    Attorneys made defendants in their individual capacities had a right to appeal and have vacated as to them an order for a temporary injunction against all defendants, though, as attorneys for defendants, the injunction against their clients would have bound them also, and they could not have appealed, if they had only been made parties in their capacity as attorneys.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 903, 904, 920, 922; Dec. Dig. <S&wkey;13S.]
    Appeal from District Court, Colorado County; M. Kennon, Judge.
    Suit by the Lakeside Irrigation Company against W. S. Strickland and others. From an order granting a temporary injunction, defendants W. S. Strickland and another appeal.
    Reversed, and judgment rendered vacating the order as to appellants.
    Strickland & Wirtz, of Eagle Lake, for appellants. W. L. Adkins, of Columbus, for appellee.
   PLEASANTS, C. J.

This is a suit for injunction brought by appellee against E. P. Brisbois, Fritz fenglehard, J. W. Burns, C. M. Womack, J. J. Mansfield, A. J. Ratliff, Adam Leyendecker, J. F. Sandmeyer, W. J. Wright, W. S. Strickland, and A. J. Wirtz. The substance of the cause of action alleged in the petition is sufficiently stated in appellants’ brief as follows:

“Plaintiff alleges: That it is a public service irrigation corporation, created and existing under and by virtue of the laws of Texas. That it is the owner of certain described land in Colorado county, Tex., on which is situated its pumping plant on the east bank of the Colorado river, by which it pumps water from said river and transports it into Eagle Lake, of 'the bed of which plaintiff owns one-half, as well as lands on the banks of said lake. That, by reason of certain litigation between John H. Kirby and plaintiff, plaintiff is required, by an injunction order, to pump as much water into the lake by reason of its river pumping plant as it takes out of said lake on the opposite side to supply its water consumers. That the said Eagle Lake is a natural pond or lake supplied alone by natural rainfall making its way into the lake by drainage, a large part of which water goes into a natural depression, known as Flag Pond slough, and from Flag Pond slough through a natural channel .into said Eagle Lake. That, with plaintiff’s property so situated, certain parties therein named (appellants not included) made application for an improvement district under chapter 85, approved March 19, 1909, at page 1'40 of the Acts of the Thirty-First Legislature. Plaintiff does not set out in detail that all the acts and procedure prescribed by, said law have been complied with, but makes no complaint as to such procedure, and alleges that the commissioners’ court of Colorado county ordered an election to be held within said improvement district on the 16th day of January, A. D. 1915, to determine whether or not said district shall be established and bonds issued in the sum of $67,500' and taxes levied in payment therefor, and in connection with such allegations makes the order of the court calling such election a part of its petition; and the order recites that all things prescribed by law up to the ordering of such election have been complied with, and orders said election as is provided by law. Plaintiff alleges: That, if said election is held as ordered, a majority of the property taxpaying voters residing in said district would vote to establish said district, and the issuance of the bonds ' and the holding of such election would result in great and useless expense to plaintiff and other taxpayers of the district. That if said election be held, and the proposed improvements made, as shown by the engineer’s report, it will irreparably injure plaintiff in that the said levee will be so constructed as to prevent the natural drainage and rainfall coming into Eagle Lake through Flag Pond slough, which water plaintiff is entitled to by virtue of its ownership of land in the bed of said lake and riparian thereto, and to supply its consumers of water, and that a levee will be so constructed as to cause water from a rise in the Colorado river to back up and come over plaintiff’s river pumping plant and flume, injuring and practically destroying the same. That such acts would be a taking of plaintiff’s property without compensation and without due process of law. That the law allows the improvement commissioners to lease the levee as a highway and to sell the surplus dirt, material, etc., not needed in the construction of the levees, which is a further confiscation of plaintiff’s property.”

The prayer of the petition is as follows:

“Wherefore plaintiff says that, said act being unconstitutional under section 17 of article 1 of the Constitution of Texas, it is entitled to an injunction to prevent the threatened injury to its property and destruction of its said franchise, and therefore prays this court for a temporary writ of injunction restraining all of said defendants, and each of them, their agents, servants, employés, and appointees, and all other persons, from holding said election, at the time mentioned or any other time, or from doing any act or thing looking to the establishment of such improvement district or the erection of any improvements therein; and further that all orders of the commissioners’ court, made at any time in the proceedings looking to the establishment of said district, be and they are hereby held for naught, and said Mansfield, Leyendecker, Ratliff, Sandmeyer, and Wright, constituting the commissioners’ court of Colorado county, Tex., be required by mandatory injunction to rescind all orders passed by said court growing out of the application for said district, and which .injunction, upon hearing, plaintiff prays shall be made final and permanent. It further prays for its costs of suit and general relief, either at law or in equity.”

It appears from the petition that the defendants Brisbois and Womack are the persons appointed by the commissioners’ court as judges, and the defendants Englehard and Burns as clerks, of the pi’oposed election. It does not appear, from any allegation in the petition, that defendants Strickland and Wirtz had anything to do with procuring the order of election, or that they will be in any way concerned in holding the election, or have any interest therein. We are informed, however, by appellee’s brief, that these last-named appellants were attorneys for the officers of the proposed election. This petition was presented to Hon. M. Kennon, judge of the district court of Colorado county, and upon a consideration thereof the prayer for temporary injunction against holding the election was granted. From this order the defendants Strickland and Wirtz have appealed.

It is apparent from the record that the learned trial judge granted the injunction upon the theory that the law under which the election was ordered to be held is' unconstitutional.

Appellee contends that the statute under which the proposed election was ordered, which provides for the creation of improvement districts and the construction of levees by such districts, and which is embraced in the Revised Statutes of 1911 as chapter 2, tit 83, is unconstitutional, because in section 5569 of said statute it is provided that “no county or improvement district, nor the taxpayers therein, shall be held for damages occasioned by the construction, maintenance or repair of levees or other improvements under the provisions of this chapter” ; and that this provision authorizes the taking or damaging of private property for public use without consent of the owner and without making adequate compensation therefor, and violates section 17, art. 1, of the Constitution of this state, and renders the whole statute void. In support of this contention, the case of Ft. Worth Improvement District v. City of Ft. Worth (Sup.) 158 S. W. 168, 48 L. R. A. (N. S.) 994, is cited. We do not think the decision in the case cited sustains the judgment of the trial court in this case. All that was decided in that case was that the creation of the proposed levee by the improve ment district, in the manner contemplated by it, was properly enjoined, because it would greatly damage, if not destroy, the plaintiff’s property, and no provision was made in the statute for payment of compensation by the improvement district, and no offer to pay for such damage was made. The opinion does not hold, nor intimate, that the entire improvement district statute is unconstitutional,- because the section above quoted is obnoxious to the Constitution. A legislative act will not be held void in its entirety because one section or portion thereof is unconstitutional, unless the void portion is such an essential and necessary part of the act that it cannot be presumed that the Legislature would have passed the act without having incorporated the void portion therein. State v. Laredo Ice Co., 96 Tex. 461, 73 S. W. 951; Ex parte Dupree, 101 Tex. 150, 105 S. W. 493; Adams v. Waterworks Co., 26 S. W. 1104.

If the section above quoted is eliminated from the statute, the remaining portion of the statute is a useful and important piece of constructive legislation, which it would be unreasonable to presume the Legislature would not have enacted if it had known that the section quoted could not, under the Constitution, be upheld by the courts.

As we have before stated, there is nothing in the record to show that appellants had any connection With or interest in the election sought to be enjoined. The appellee, however, saw fit to make them parties to the suit, and the injunction was granted against them as well as the other defendants named in the petition. Under these facts, appellants had the right to appeal from the judgment and have the injunction against them vacated. We have no doubt that, as stated by appellee, in its brief, appellants were the attorneys for other defendants, and, as such, an injunction against their clients would have been binding upon them; and in such case they not having been made parties to the suit, or, only being made parties in their capacity as attorneys, could not have prosecuted an appeal from the judgment; but having been named as defendants, so far as the record shows, in their individual. capacity, they have the right to appeal from the judgment.

From the conclusions above expressed, it follows that the order granting an injunction against appellants should be reversed, and judgment here rendered vacating said order as to them; and it has been so ordered. The injunction is undisturbed as to the defendants who have not appealed.

Reversed and rendered.
      (g^jFor other oases see same topic and KEY-NUMBER in ail Key-Numbered Digests and Indexes

      <g^s>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes