author: FLY, C. J.

text:
    TEXAS FIDELITY & BONDING CO. et al. v. ELLIOTT et al.
    (No. 5804.)
    (Court of Civil Appeals of Texas. San Antonio.
    April 25, 1917.
    Rehearing Denied May 23, 1917.)
    1. Appeal and Ebkok @=>230 — Objections Below.
    Judgment against a bonding company could not be assailed on appeal because the company had been dissolved and its charter forfeited nearly a year after suit was instituted, where neither in its answer nor during the trial did the company disclose such fact, and did not mention it until motion for new trial was filed, although one of the liquidating trustees of the corporation was attorney for the bonding company.
    2. Principal and Surety <@=37 — Bond eor Building Contract — Ownership by Ob-ligee oe Property.
    A bonding company’s bond to secure the execution of a building contract was not vitiated by the fact that obligee had only the legal title to the premises, and the equitable title was in another.
    [Ed. Note. — Eor other cases, see Principal and Surety, Cent. Dig. §§ 8-12, 14, 16, 18.]
    3. Principal and Surety <@=>82(2) — Building Contract Bond — Damages eor Delay.
    A building contract bond that the contractors will “well and truly perform the covenants,” etc., of the contract, the surety assuming liability for any and all damages naturally and directly resulting from failure to do the work in the time specified, renders the bonding company liable for damages from delay by the contractor.
    [Ed. Note. — Eor other cases, see Principal and Surety, Cent. Dig. § 127.]
    4. Mechanics’ Liens <@=>115(4) — Material-man’s Lien.
    Under Rev. St. 1911, art. 5623, as to mate-rialman’s lien, when notice is given to the owner or his agent of the fact that material has been furnished a contractor, subcontractor, agent, or receiver, a lien is fixed on the property to the extent of the sum afterwards paid under the original contract; the statute fixing a lien for the materialman, on his compliance with it, on the property of the owner to the extent of the amount due by the owner to the contractor.
    [Ed. Note. — Eor other cases, see Mechanics’ Lions, Cent. Dig. §§ 157-159.]
    5. Mechanics’ Liens <@=>115'(4) — Material-man’s Lien.
    The lien of materialmen under Rev. St. 1911, art. 5623, as to such lien, upon the contract money paid to the contractor after notice of such lien, is not affected by the fact that the money so paid to the contractor was used by it to pay current weekly pay rolls of workmen, necessary to be paid to avoid stoppage of the work, since similar necessity is incident to all building construction.
    [Ed. Note. — Eor other cases, see Mechanics’ Liens, Cent. Dig. §§ 157-159.]
    6. Mechanics’ Liens <@=>196 — Who May Claim Lien.
    The equitable owner of property, who has transferred the legal title to another merely for the purpose of building, cannot, on furnishing material for such building, claim a lien therefor as against real lienholders.
    [Ed. Note — Eor other cases, see Mechanics’ Liens, Cent. Dig. §§ 837-341.]
    Error from District Court, Bexar County; R. B. Minor, Judge.
    Suit by I-I. D. Elliott against the Texas Eidelity & Bonding Company and others. Erom a judgment, the named defendant and others bring error.
    Affirmed.
    Hertzberg, Barrett & Kercheville, of San Antonio, for plaintiffs in error. Arnold, Ooz-by & Peyton, C. A. Keller, W. S. Anthonj", T. H. Ridgeway, and 1 Jno. P. Pfeiffer, all of San Antonio, for defendants in error.
   FLY, C. J.

This suit was instituted by H. D. Elliott against the Texas Fidelity & Bonding Company, the San Antonio Sand Company, the Tips Hardware Company, George T. Jambers, the San Antonio Portland Cement Company, the Alamo Iron Works, Decatur Bridge Company, Hillyer-Deutsch-Jarratt Company, Gordon-Jones Construction Company, H. M. Abernathy, trustee for the last-named company, bankrupt, and David M. Pic-ton & Co., to recover against the construction company, the trustee in bankruptcy, and the bonding company the sum of $12,750.98, with 6 per cent, interest from' December 8, 1913, and to adjudicate the rights of the other defendants who were claiming material-men’s liens on a house constructed by the construction company for Elliott. The bonding company had given bond for $10,000 to secure the faithful erection of, the building. Each one of the parties, who were defendants below, except the construction and bonding companies, who answered, claimed liens for material furnished for the construction of the building. The San Antonio Sand Company, Tips Hardware Company, George T. Jambers, Gordon-Jones Construction Company, and H. M. Abernathy, trustee, did not answer. Charles Baumberger, Sr., Charles Baumberger, Jr., Albert Kronkosky, and Fred W. Cook, who were made parties by the bonding company, appeared and answered. The cause was submitted to a jury on special issues, and upon the answers returned thereto judgment was rendered in favor of I-I. D. Elliott for $10,000 as against the bonding company, against the construction company and its trustees for $15,446.34; in favor of the Alamo Iron Works, Hillyer-Deutsch-Jarratt Company, Decatur Bridge Company, and David M. Picton & Co. for the amounts claimed by them, and for foreclosure of their liens on certain property described therein i that the cement company recover nothing; and that the other iiarties go hence without day. The parties who foreclosed liens and the bonding company were also given judgment against the construction company and its trustee for the respective amounts claimed by them. The bonding company, the cement company, and I-I. D. Elliott prosecuted writs, of error to this court.

The evidence shows that the cement company desired to build a house and, being desirous of avoiding offense to builders and. contractors, conceived the novel idea of conveying the property to I-I. D. Elliott and entering into a contract with said Elliott that, the cement company should furnish the money to construct the house and when completed the property should be conveyed back to the cement company. The contract for the construction of the building was made by and between Elliott and the construction company. The bond made by the bonding-company was to indemnify Elliott for the-failure of the construction company to complete the building according to the terms of its contract. It breached its contract, and Elliott was damaged in the sums decreed by the judgment. The liens given preference by the judgment to the four parties claiming the same were fixed by notice on a fund of $3,135, which was in the hands of Elliott when the notices were given and was after-wards paid out by Elliott to the construction company.

Through the first assignment of error, the bonding company assails the judgment of the trial court because the bonding company had been dissolved and its charter forfeited by the state of Texas, nearly a year after this suit was instituted. The bonding company, neither in its answer nor during the trial, disclosed the fact of the forfeiture of its charter. No evidence was offered to that effect, and the matter was never mentioned until the motion for new trial was filed. One of the liquidating trustees of the corporation was an attorney for the bonding company. It is a statutory requirement that an answer setting up certain matters, among the number “that the plaintiff or defendant, alleged in the petition to be duly incorporated, is not duly incorporated as alleged,” shall be verified by affidavit. It has been held_ by this court that, where.it is alleged that a party is duly incorporated, it will be taken as true in the absence of a denial under oath of the opposing party. Steely v. Texas Improvement Co., 55 Tex. Civ. App. 463, 119 S. W. 319. The first assignment is overruled.

The legal title to the' land on which the house was erected was in H. D. Elliott, whatever secret understandings there may have been between him and his vendor, the cement company; and contracts made by him as to buildings on the land, or as to bonds to secure the execution of the building contracts, would be binding upon all the parties. The proposition of the bonding company is:

“If Elliott was not the owner of the property upon which the improvements were erected, the bond given to him, as owner, by the contractor and surety company, would be vitiated.”

No reason is given to support the proposition, and no authority is cited that sustains, it. The bond does not mention the question of ownership and makes no provision for its failure if the full ownership of the land was not in Elliott. No attempt is made to show that the matter of ownership could have, in any way, inured to the benefit, or caused the injury, of the bonding company. The condition was, as contended by the bonding company, to indemnify Elliott, and that was one of the objects of the suit. It is no concern or business of the bonding company as to what Elliott may do with the money when he gets it. The construction company has breached its contract; the bonding company has bound itself to make good the contract in the sum of $10,000, and cannot evade that .obligation by proof that another corporation owns the equitable title to land to which its obligee has a legal title. Again, there is not one iota of evidence which tends to show that the(charter of the bonding company had been forfeited. It is not pretended that falsehood, fraud, or false pretenses were used to induce the bonding company to furnish -the bond. There is nothing in the record that tends to show that the bonding company would have preferred to have given a bond to Elliott, rather than the cement company, or,that it would have been in any better shape or condition if Elliott owned, or did not own, the land. The fact remains that default was made, and that it had promised to remedy it. Shortly .after the bond was given, the bonding company dis covered the condition of the title, and yet no objection was raised until after this cause had been tried and judgment rendered against it.

The Iowa case of Getchell v. Peterson, 124 Iowa, 599, 100 N. W. 550, cited by the .bonding company, is,authority for propositions of law directly opposed to those proposed by the bonding company. The contention in that case was that the bond given for the faithful execution of a contractor’s contract had no binding force because false representations had been made as to the ownership of the premises, and the court held:

“True, it appeal's that the legal title to the lot upon which the house stands is in W. Y. McQuaid, and not in IT. W. McQuaid. No representation as to the title is shown to have been made, except as the same may be inferred from the fact that the contract and bond speak of H. W. McQuaid as the ‘owner’ of the premises. The term ‘owner’ is one of quite general application, and is frequently applied to one having an interest in or claim upon property much less than absolute and unqualified title. * * * Ownership may be qualified or unqualified, legal or equitable, and from the mere fact that the legal title of this lot is not in IT. W. McQuaid it does not follow that he is not the owner of a title which is good against the world. There is no pretense that he is not the owner of the building, or that he is a trespasser upon the land. Presumably he is rightfully in possession, and for the purposes of the contract and of all parties thereto he is the owner.”

In this! connection, it may be stated that the contention, made through the sixth assignment of error, that the bonding company was not liable for the damages of $20 a day arising from,delay on the part of the contractor, is fully answered in the Iowa case cited by the bonding company. In that case it was held:

“It is said the bond only indemnifies McQuaid against damages sustained on account of the negligence of the contractor's. Even if this be so, is not negligence of the contractors the gist of the owner’s complaint that the building was not completed until long after the time agreed upon? But the bond is not subject to any narrow interpretation in this respect. The undertaking is general that Peterson & Sampson will ‘well and truly perform the covenants and stipulations’ in the contract, and the surety clearly assumed liability for any and all damages naturally and directly resulting to the obligee from the failure of the contractors to do the work in the manner and within the time specified.”

The undertaking of the,surety in this ease was similar to those named in the Iowa case. The evidence sustained the finding as to the damages for delay.

The judgment against .the bonding company was for $10,000, the amount for which the bond was given, and it is unnecessary to consider the question whether the obligee could recover damages ,for delay for the time after he took charge of the work of completing the building, because there was, under the testimony, a delay of 108 days before the work was taken in charge by the owner, which amounted at $20 a day, found by the jury to have been the actual damages sustained, to the sum of $2,160. If that amount be added to the loss of $7,850.98 sustained by Elliott on account of the increased cost of the building, the aggregate sum would be $10,010.98, which is within the amount of the bond.

The bonding company has no right to concern itself with the disposition that Elliott makes of the damages recovered by him. It is probable that the cement company will be able to adjust matters between itself and Elliott, and, if it fails in that undertaking, it is not a matter about which the bonding company should seek to interfere. If Elliott was merely an agent of the cement company, which the facts seem to indicate, he had been intrusted with the legal title to the land and the responsibility of having improvements constructed on it, and it should not be a matter of solicitude to the bonding .company as to secret contracts between the parties or as to whether they can adjust their affairs equitably and justly. The contractor and the bonding company may not have known that there was a private contract as to penalties on account of delays between Elliott and the cement company, but both knew of the provision for penalties for delay in the contract between the construction company and Elliott, and that was sufficient.

The third assignment of error is followed by neither proposition nor statement. However, the matters sought to be raised by the assignment are fully discussed under the second assignment.

There is no inconsistency in holding that Elliott, the holder of the legal title, could sue for and recover damages arising from a breach of the construction contract, and that the equitable owner of the land and building could not foreclose a lien on its own property to the detriment of other lienholders. Elliott as holder of the legal title had the right to contract for the construction of the house, but the equitable owner had no right to fix a lien on its own property.

There was no error in submitting the issue as to whether the contractor ordered the structural steel without delay. It was provided in the contract that the improvements should be ready for occupancy in 120 working days from date of the contract, but there was a proviso that:

“If the contractor shall order the structural steel without delay, and the structural steel is not delivered within 60 working days from date hereof, then the time of the completion shall be extended for as many working days as the delivery of said structural steel shall be delayed beyond sixty working days from date hereof.”

It is clear that the extension of time wms given as a premium for promptness and dispatch in ordering the steel and that the extension was dependent on such promptness. It therefore was material, in settling the issue of delay, to ascertain if the contractor had promptly ordered the structural steel. The evidence sustained the finding of the jury that there had been unreasonable delay in ordering the structural steel, and the provisional extension of time became null and. void. In pleading delay, Elliott raised the> issue submitted to the jury. The evidence justified it, and the jury found that actual damages resulted from the delay in constructing the improvements.

Admitting that the question as to whether Elliott, when he took charge of the work, expeditiously finished it, was irrelevant and immaterial, its submission could not in any manner have injured the bonding company, and it docs not claim any injury from it. The eighth assignment is overruled.

The item of $3,135 which was in the hands of Elliott at the time of notice of the existence of the liens, and for which he was held liable, did not increase the liability of the bonding company; for, subtracting the amount for 108 days’ delay and the $3,135 from the damages found in favor of Elliott, the $10,000 remain to cover the balance of the damages. The bonding company lost nothing by the payment of the $3,135 to the construction company. The issues as to the purposes for which the $3,135 were used did not affect the liability of the bonding company, and it has no' ground of complaint. The money was paid out for the benefit of the construction company.

The eleventh assignment of error has been disposed of by the consideration of other assignments involving the same subject, and it will be overruled. This disposes of the brief of the bonding company.

AVe conclude that there was no error in rendering judgment in favor of the four lienholders against Elliott for the several sums due them for material furnished to the contractors and in foreclosing their liens on the property. When the statutory notices were served on Elliott, he had in his hands, of the contract price for the construction of the improvements, the sum of $3,135, which he afterwards expended. It does not matter for what it was expended, nor what good may have been accomplished by its expenditure. The statute is positive that when the notice is given to the owner or his agent oí the fact that material has been furnished a contractor, subcontractor, agent, or receiver, a lien is fixed on tide property to the extent of tlie sum afterwards paid under the original contract. Rev. Stats. art. 5623; Padgitt v. Construction Co., 92 Tex. 626, 50 S. W. 1010; Berry v. McAdams, 93 Tex. 431, 55 S. W. 1112. Whatever may be the rule in New York, or other states, our statute fixes a lien for the materialman, when he complies with the statute, on the property of the owner to the extent of the amount due by the owner to the contractor. Fullenwider v. Longmoor, 73 Tex. 480, 11 S. W. 500; Lonergan v. San Antonio Trust Co., 101 Tex. 63, 104 S. W. 1061, 106 S. W. 876, 22 L. R. A. (N. S.) 364, 130 Am. St. Rep. 803. As said in the first case cited:

“From the time of the service of the notice upon the owner of the property he can make no further payment to the. contractor without incurring liability for the lien debt, if proper steps shall be taken to establish it, to the extent of his indebtedness under the contract when the notice is served.”

In the Lonergan Case it was said:

“The owner of the property is liable to the ma-terialman only as he (the owner) would be liable to the contractor.”

Elliott had agreed to pay the contractor a certain sum for the erection of the improvements, and out of that sum there remained in his hands the sum of $3,135 which was appropriated by the statutory notice given by the materialmen. Elliott had no authority to pay the money to the contractor for any purpose. Wilkerson v. McMurry, 167 S. W. 275; Seeling v. Alamo Iron Works, 173 S. W. 520. The money paid on the contract after.the notice was money subject to the liens of materialmen.

The facts show that, after the notices were served on Elliott, he paid to the construction company, as he bad done before, on the vouchers of the architect, the sum of $3,135. The payments were made under the original contract, and Elliott did not pay the laborers and materialmen after the notices any more than he did before. In fact, he never did pay for any labor or material until' after he had set aside the contract and had begun to finish the improvements for himself. Not until the contract was abrogated, quite a while after the notices were given, did he bring himself within the purview of the case of Fall v. Nichols, 43 Tex. Civ. App. 582, 97 S. W. 145, so confidently relied on by Elliott. That case has no hearing on this, as to the time when the $3,135 was expended.

Elliott, in his brief, many times refers to findings of the jury that the money paid to the construction company was used to pay current weekly pay rolls of workmen, and that it was necessary to pay these, and that if they had not been paid the work would have stopped, but fails to point out any testimony that sustains the answers. The statement of facts shows that the construction company was paid upon vouchers by the architect, after March 10, 1914, when the notices were given, just as it had been paid before that time, .and Elliott knew no more how the money was used .after the notices were given than he knew before they were given. If liens were not fixed by the notices of March 10, 1914, then there never was a time from the inception of the contract when they could have been fixed. The $3,135 paid to the construction company after the date named was not expended by Elliott to workmen, laborers, and material-men, with whom he had contracted, but was paid out as stated in the vouchers for “90 per cent, of labor and material furnished in the construction of Pocahontas Milling Company stock house to date by said contractors and the above payment is in accordance with the contract requirements.” It may be, as contended by Elliott, that it was absolutely necessary for the vouchers to be paid in order that the construction should proceed; but that is the usual condition of affairs under all building contracts. The owner had not declared the contract breached, and had not assumed management of affairs during the time that the $3,135 was being expended. He after-wards did take ■ charge of the construction, but not until the $3,135 had been expended.

If the propositions contended for by Elliott were the law, the liens given material-men and laborers would be a snare and delusion; for, if a lien cannot be fixed where it is necessary to pay the contractor to carry on the work under his original contract, then tile circumstances would never arise when liens would attach. The effect of such a ruling would be that materialmen, who furnished material after the notices were given by those who had furnished material before that time, would secure their money without any effort to fix liens and those who had complied with the law would go unpaid. Materialmen are compelled to take the chance of the contractor becoming unable to fulfill his contract and having it forfeited and the building taken over by the owner, but do not take the chance of having their liens, fixed according to law, set aside by a claim that money afterward paid to the contractor was done in order that he might fulfill his contract. No case has been cited, nor do we think can be found, that sustains any such proposition as thát advanced by Elliott.

The case strongly relied on by Elliott is Rodbourn v. Grape & Wine Co., 67 N. Y. 217, but that case sustains no such proposition as that set out in Elliott’s brief. The New York court merely held, as do all the cases cited by Elliott, that an owner could not be held for liens attempted to be fixed on his property after he has been compelled to take charge of and complete a .building which the contractor had failed to finish. The $3,135 was expended by, Elliott after notice was given and before be took charge of the construction, and none of it was expended for material bought or labor secured by Elliott, but it was expended by the contractor under his contract just as it had been expended since the construction of the building was begun.

None of the cases cited by Elliott has gone further than to hold that, where a building contract has been breached by the contractor and the owner is compelled in good faith to complete the improvements or enter into a new contract to have the same completed, the owner cannot be held liable for any sum judiciously expended after such breach, unless there should remain something of the original contract -price after the completion of the building. If all liens can be defeated by the fact that long after they are fixed the contractor fails, and the owner is compelled to complete his building at a greater cost than originally contemplated, liens for material amount to little or nothing. If the Gordon-Jones Construction Company was insolvent and unable to complete the contract when the notices were given, the owner should have declared the contract abrogated and have taken charge of the work. He should not have continued paying money to the contractor as he had done before the notices were served, giving no heed whatever to. such notices.

There is no merit in the contention of the San Antonio Portland Cement Company, the "equitable owner of the land and improvements, that it should have a lien for materials furnished to build its own house. It had contracted to furnish the materials and have the property reconveyed to it, and it would be a novel procedure for it to be allowed to obtain a lien on its own property, and thus prevent the real lienholders from collecting their debts. The transaction between Elliott and the cement company was had to screen and protect the latter from the disaffection and animosity of contractors who might fail to secure the acceptance of their bids for the erection of the improvements, and, while it placed the legal title in Elliott and gave him the right to contract about the improvements, it did not take the real title to the property out of the cement company. Its contentions as to the right to secure a lien are overruled:

The judgment is affirmed.
      ©asFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

      <@=>Eor oilier cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: PLEASANTS, C. J.

license: Public Domain

text:
    JONES et al. v. HOLMES et al.
    (No. 7363.)
    (Court of Civil Appeals of Texas. Galveston.
    April 12, 1917.
    Rehearing Denied April 26, 1917.)
    1. Insurance &wkey;>770 —■ Fraternal Benefit Insurance.
    Under Rev. St. 1911, art. 4832, regulating fraternal beneficiary associations, and the rules of the Endowment of Colored Knights of Pythias of Texas, an aged, infirm, and childless member, separated from his wife, and dependent on one not a relative for support, may designate the person supporting him as beneficiary.
    [E'd. Note.- — Eor other cases, see Insurance, Cent. Dig. §§ 1933, 1937.]
    2. Appeal and Error <&wkey;742(l) — Briefs—-Assignments of Error.
    Assignments of error not followed by a statement from the record, as required by the rules for the Court of Civil Appeals, are not entitled to consideration.
    [Ed". Note. — For other cases, see Appeal and Error, Cent. Dig. § 3000.]
    3. Insurance <&wkey;784(6) — Fraternal Benefit Insurance — Change of Beneficiary — Form. ,
    Failure of a member to comply strictly with the laws of a fraternal benefit association in making change in the beneficiary of his - certificate can be asserted only by the association.
    [Ed. Note. — For other cases, see Insurance, Cent. Dig. § 1954.]
    Appeal from Galveston County Court; Geo. E. Mann, Judge.
    Action by Cassie Holmes against Grand Lodge Colored Knights of Pythias of Texas and another, in which Walter Willis intervened. Judgment for plaintiff, and defendant Emma Jones and intervener appeal.
    Affirmed.
    O. S. York, of Galveston, for appellants. Marsene Johnson, Elmo Johnson, Roy Johnson, and Marsene Johnson, Jr., all of Galveston, for appellee.
   PLEASANTS, C. J.

This suit was brought by appellee Cassie Holmes against the Grand Lodge Colored Knights of Pythias of Texas and appellant Emma Jones, to recover upon a benefit certificate for the sum of $500 life insurance and $75 funeral expenses, issued by said lodge to Emile Jones, deceased. After alleging the names and residences of the parties, the membership of the deceased in appellee lodge, and the issuance of the benefit certificate, the petition contains the following allegations:

“That the said Emile Jones, now deceased, was, during his lifetime, the lawful husband of the defendant Emma Jones, and that said Emma Jones and said Emile Jones were living separate and apart from each other, and had been for several years. That during the last three years of the life of said Emile Jones he was aged and infirm and incapable of supporting and maintaining himself, and without any means of support, and that this plaintiff cared for, maintained, and supported the said Emile Jones for more than three years prior to his said death, and that said Emile Jones depended upon this plaintiff for -his care, maintenance, and support. That on April 12, 1912, the said Emile Jones caused the name of the beneficiary in said benefit" certificate to be changed, and named this plaintiff, Cassie Holmes as the beneficiary. That the said Emile Jones died in Galveston, Galveston county, Texas, on November 29, 1915, and at the time of his said death he was a member in good standing in said fraternal order, and that the defendant Grand Lodge Colored Knights of Pythias of Texas did not pay the aforesaid sum of seventy-five dollars toward the said funeral expenses; That by the terms of the constitution and bylaws of the defendant Grand Lodge Colored Knights of Pythias of Texas this, plaintiff became entitled to the amount of said policy and funeral benefits, said constitution and by-laws reading as follows:
“ ‘Laws Governing the Endowment Department.
“ ‘Chapter I.
“ ‘See. 4. A husband separated from his wife, but not divorced, may designate some one or more persons, other than the wife, his beneficiary, provided the beneficiary so designated, to the exclusion of the wife, shall be his child or children if such there be. If there be no child or children, and he be aged and infirm, he may designate as his beneficiary the person or persons upon whom he depends for support. * * >
“That said Emile Jones during his lifetime was living separate and apart from his said wife, and was without any child or children, and was dependent upon this plaintiff and was aged and infirm. That the defendant Emma Jones is claiming said sum of money "due under said policy of insurance, and that the said Grand Lodge Colored Knights of Pythias of Texas have refused to pay this plaintiff or said Emma Jones the amount of said policy and funeral benefits. Wherefore plaintiff prays that the defendants Grand Lodge Knights of Pythias of Texas and Emma Jones be cited to appear and answer this suit, and that on final trial hereof that this plaintiff have judgment for said sum of five hundred and seventy-five dollars, and for general relief, with costs of suit.”

The defendant lodge answered by general demurrer, special exception, and general denial; and further answered that it was advised and believed that two or more persons were claiming to be the beneficiaries in said certificate; that this defendant had no interest in the matter, and would deposit the amount named in the certificate in court to abide the judgment of the court.

The answer of defendant Emma Jones denied generally and specially the allegations of plaintiff’s petition above set out, and avers that if there was a change in the beneficiary named in the certificate, as alleged in the petition, “it was through fraud on the part of the said Cassie Holmes.” The answer further avers that for some time prior to his death Emile Jones was mentally deranged, and was confined in the county jail most of the time from shortly after the issuance of the certificate until February 25, 1914, when he was adjudged a lunatic, and was thereafter kept in the jail until just before his death, when he was removed to the city hospital, where he died.

Walter Willis, a nephew of the deceased, with leave of the court, intervened in the suit, and alleged that he was one of the original beneficiaries named in the certificate with Emma Jones, and prayed “with Emma Jones that ’Cassie Holmes take nothing in this suit, and that he and Emma Jones have judgment against the Grand Lodge of Colored Knights of Pythias et al. and Cassie Holmes for the amount sued for.”

The trial of the cause in the court below without a jury resulted in a judgment in favor of appellee Cassie Holmes. The defendant Emma Jones and the intervener Walter Willis prosecute this appeal.

The first and second assignments of error assail the judgment on the ground that it appears from the allegations of the petition and the undisputed evidence that plaintiff Cassie Holmes had no insurable interest in the life of the deceased, and therefore was not entitled to recover upon said benefit certificate. The proposition under these assignments is as follows:

“Under a fraternal policy a person not related to the insured within the degree allowed by the statutes or who was not dependent upon the insurer cannot become a beneficiary.”

The allegations of the petition before set out and the undisputed evidence show that plaintiff is not related to the deceased Emile Jones, and was not dependent upon him for support. There is, however, evidence sufficient to sustain the finding that at the time plaintiff was made beneficiary of the certificate, and continuously thereafter until the death of the deceased, he was mainly dependent upon her for care, attention, and support, and that he and his wife were separated and lived apart from each other during all of said time.

The evidence shows that tire deceased Emile Jones had no child. Section 4, c. 1, Laws Governing the Endowment of Colored Knights of Pythias of Texas, is as follows:

“See. 4. A husband separated from his wife, but not divorced, may designate some one or more persons, other than the wife, his beneficiary, provided .the beneficiary so designated, to the exclusion of the wife, shall be his child or children, if such there be. If there be no child or children, and he be aged or infirm, he may designate as his beneficiary the' person or persons upon whom lie depends for support; should he not be aged or infirm, he will only be permitted to name as beneficiaries, other than his wife, the beneficiaries named in section 1 of this article, and in the order therein named to the pei-sons dependent upon him for support.”

It is further provided in section 5 of said laws that where a wife is named beneficiary in a policy issued to the husband, and she thereafter abandons him, or, being in sound bodily health, shall fail to care for or minister to her husband and family, the husband may designate some other person as his beneficiary to the exclusion of the wife; and if he has no child or children, and is aged or infirm, he may make the person upon whom he is dependent for support his beneficiary.

Article 4832, Revised Statutes 1911, regulating Fraternal Beneficiary Associations, contains the following provision:

“The payment of death benefits shall be confined to wife, husband, relative by blood to the fourth degree ascending or descending, step-father, step-mother, step-children, children by legal adoption, or a person or persons dependent upon the member; provided, that, if after the issuance of the original certificate the member shall become dependent upon the charity of an individual or of an institution, he shall have the privilege, with the consent of the association, to make such individual or institution his bene1-ficiary. * * * ”

It is clear, under these provisions of the laws of the order and the statute, that the assignments cannot be sustained.

Tlie remaining assignments of error presented in appellants’ brief are not entitled to consideration because not followed by a statement from the record, as required by the rules for this court. All of these assignments however, only raise questions as to the regularity of the methods pursued by the deceased to have the change made in the beneficiaries of his certificate. The failure of the deceased to strictly coinply with the laws of the association in making' the change in the beneficiary of the certificate can only be asserted by the ássociation. The provisions of the' by-laws which it is contended were not complied with by the deceased were made for the benefit and protection ■of the association, and the association has not questioned its liability to plaintiff because of such irregularities, and appellants are not entitled to raise such questions. Splawn v. Chew, 60 Tex. 533.

We are of opinion that the judgment of the court below should be affirmed, and it has been so ordered.

Affirmed.
      <§^>For other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: GRAVES, J.

text:
    MATAGORDA COUNTY DRAINAGE DIST. NO. 5 et al. v. BORDEN et al.
    (Court of Civil Appeals of Texas. Galveston.
    April 12, 1917.
    Rehearing Denied May 10, 1917.)
    Eminent Domain <&wkey;281 — Remedy of Property Owner — Defense to Injunction.
    Since Vernon’s Sayles’ Ann. Civ. St. 1914, art. 2590, giving drainage districts the right of condemnation of land only in conformity to the statutes for “condemning and acquiring the right of way by railroads,” refers to articles G5Ó4, 0530, inclusive, providing method of condemnation rather than to article 6531, allowing a railroad sued in trespass to try title to apply for condemnation of the property in cross-bill, a drainage district defending a suit to enjoin its contemplated invasion of land by flowage, could not, in 'its answer, seek to condemn the right of way in the land affected, by offering to pay the valuation to be established, without first making the payment or depositing it in court, especially where the district was shown to be insolvent, so that it could not make its tender of payment effective, in view of article 65301, reiterating, in effect, the same provision in Const, art. 1, § 17, prohibiting a corporation from entering upon or taking condemned property without first having paid or deposited in court damages awarded in condemnation proceedings.
    [Ed. Note. — For other cases, see Eminent Domain, Cent. Dig. §§ 776, 780-.]
    Appeal from District Court, Matagorda County; Sami. J. Styles, Judge.
    Suit by A. P. Borden and others against Matagorda County Drainage District No. 5 and others. From judgment for plaintiffs, defendants appeal.
    Affirmed.
    J. W. Conger and F. H. Jones, both of Bay City, for appellants. Proctor, Vandenberge, Crain & Mitchell, of Victoria, and Krause & Wilson, of Bay City, for appellees.
   GRAVES, J.

This is the second appeal to this court in this "litigation over the same subject-matter and between the same parties. The first appeal, reported in 181 S. W. 780 (Matagorda County Drainage District No. 5 v. Borden, et al.), was from an order of the district judge granting a temporary injunction in this case, said order and judgment having been affirmed in this court in an opinion reported in the cited volume of the Southwestern Reporter. The case was later, at the January, 1916, term of the district court of Matagorda county, tried on its merits upon an amended petition filed by appellees against appellants seeking a perpetuation of the temporary injunction formerly granted them. The court upon this final trial rendered judgment for appellees against appellants perpetuating the temporary injunction, and the present appeal is from that final judgment.

This amended petition, though slightly different in such minor and unimportant respects as omitting the county judge as a party, the allegations against the sale of the drainage district bonds, and the prayer for damages, was, in so far as it sought relief against the damaging of appellees’ property known as the Mad Island Pasture, a mere amplification of the original petition, the allegations being, however, much more specific and complete.

The statement of the case as made by this court on the former appeal, as set out on pages 780 and 781 of 181 S. W. was as follows :

“The appellees sue as legal owners of a large body of pasture land, 4,962 acres of which are within Matagorda Drainage District No. 5 and 7,057 acres adjoining said drainage district. The suit is against the drainage district and its trustees or commissioners and a firm of contractors who had entered into a contract with said commissioners to construct certain ditches in said district for the purpose of draining it. The injunction was sought for the purpose of restraining the construction of said ditches, upon the ground that if they were constructed in accordance with the plans and specifications prepared by the engineer of the drainage district, and which defendants were about to carry out, plaintiffs’ land within and without said district would be greatly damaged by the overflow of water drained from said district and cast upon plaintiffs’ land by the contemplated ditches. The damage that it is claimed will accrue to plaintiffs’ land by the construction of the ditches is alleged to be $50,000. It is further alleged that the defendant drainage district has no funds on hand and none which are available out of which to compensate plaintiffs for the damages that it will cause them by the construction of said ditches, and that the district cannot raise the money by taxation to pay such damages, because it has already levied the full amount of taxes which it is authorized to levy by the Constitution and laws of this state, and the taxes so levied are already set apart for the redemption of the bonds issued to provide the necessary funds to pay for the construction of the drainage ditches and the survey and preparation of plans for the drainage system for said district; all of the proceeds of the sale of said bonds being' required for said purposes. The petition prays that defendants be enjoined from the construction of said ditches until plaintiffs have been adequately, compensated for the injury and damages that will be caused plaintiffs’ property by their construction.”

The most substantial and material change in the positions of the parties in the two trials for injunction were that in the one from which this appeal is taken the appellants sought to bring themselves within the rules of law stated in this court’s opinion upon the first appeal by making tender, in their supplemental answer to appellees’ amended petition for injunction, of payment for the right of way across appellees’ lands, and claiming that, as a quasi public corporation and under the express provision of the drainage law (R. S. art. 2590), the drainage district had the right of eminent domain, and the consequent authority to condemn the lands for the purposes sought, and asking the district court in this suit for injunction to order the condemnation and valuation of the lands, and offering to pay the full amount found when that had been done. A special exception directed against this part of said answer, on the ground that that court .was wholly without jurisdiction to so condemn said lands and assess damages, was sustained by the court. This action is complained of under the thirteenth assignment, and, since it raises the question of the court’s jurisdiction to grant the only material additional right over what was involved in the former hearing and the appeal therefrom — that is, the alleged right to have the land condemned and valued through that court — it will be first discussed.

We think appellants mistook their forum, and must overrule their contention. The section of the drainage law invoked (Vernon’s Say les’ Statutes, art. 2590), granting the drainage district the right of eminent domain for the purpose of condemning and acquiring the right of way to lands for its uses, provides for its exercise in a precise and particular manner, and evidently in that manner alone, as follows:

“All such condemnation proceedings shall be instituted under the direction of the drainage commissioners, and in the name of the drainage district, and the assessing of damages shall be in conformity to the statutes of the state of Texas for condemning and acquiring the right of way by railroads.”

Now, when the statutes “for condemning and acquiring the right of-way by railroads” are looked to, only one article is found, to wit, art. 6531, Vernon’s Say les’ Statutes, which could possibly confer this jurisdiction upon the district court, and that is a special statute, apparently limited to the particular instance of railway companies sued in trespass to try title to recover possession of a railway right of way, and reading as follows :

“When any railroad company is sued for any property occupied by it for railroad purposes, or for damages thereto, the court in which such •suit is pending may determine all matters in ■dispute between the parties, including the condemnation of the property, upon petition or cross-bill asking such remedy by defendant, but the plea for condemnation shall be an admission of the plaintiff’s title to such property.”

While under this .article, when properly invoked in the particular class of cases therein contemplated, a district court, having already acquired jurisdiction, could condemn land and award damages, as an incident to the suit in trespass to try title, for the purpose of completing its jurisdiction and determining all matters there in dispute between the parties (Rabb v. Canal Co., 62 Tex. Civ. App. 24, 130 S. W. 916), it is from its terms evident that it did not confer general jurisdiction for the condemnation of lands upon that court, but seems to have restricted the exercise of such jurisdiction to the particular class of cases where the railroad had been sued for, or for damages to, property already occupied by it.

Nor ido we think the provision in article 2590 of the drainage law, that “the assessing of damages shall be in conformity to the statutes * * * for condemning and acquiring the right of way by railroads,” was meant to refer to this single article. If it had been, the mention of it by its number alone— that is, article 6531 — would have been the simplest and most direct way of expressing what was meant. But rather do we think the statutes thus referred to were Vernon’s Sayles’- Revised Statutes, arts. 6504 to 6530, inclusive, which provide a comprehensive system of procedure by railroad companies for the condemnation - and acquirement of lands by applying first to the county judge, and then prosecuting the matter through the county court in the detailed manner in said series of articles prescribed. So. Kan. Ry. Co. v. Vance, 155 S. W. 696, and other cases under article 6506; Ry. Co. v. Poindexter, 70 Tex. 98, 7 S. W. 316.

We have italicized part of the above-quoted recitation from said article 2590 of the drainage law as follows, “for condemning and acquiring the right of way hy railroads," as further indication that it was therein meant to refer to this series of statutes from article 6504 through article 6530, and not to the separate article 6531, because that series outlines the full and detailed methods by which in general railroads may proceed affirmatively in the first instance to both condemn and acquire land or property for any of their legitimate purposes, while the latter single article merely authorizes condemnation alone through that court; that is, any court iii which the railroad has been sued as a defendant for the title, or for damages, to property already taken and then held by it for railroad purposes.

If these conclusions be correct, then, since said article 6530 — reiterating, in effect, the same provision in section 17, art. 1, of our State Constitution — provides that, “In no case shall such corporation be entitled to enter upon and take the property condemned, without first having paid whatever amount of damages and costs may have been awarded or adjudged against it by such commissioners, or deposited money to cover the same in the court wherein such condemnation proceedings are pending,” the .drainage district did not meet these requirements, and certainly could not actually take the 38% acres of ap-pellees’ lands its contemplated ditches required by merely offering through its pleadings, to pay therefor whatever that district court might thereafter determine was the value thereof, in-the face of this explicit requirement in both Constitution and statute that the payment must be first made or deposited in court.

The actual contemplated taking of 38% acres of their lands under these stated conditions, without compensation having been first paid to them or deposited in court, was one of the causes of action set up by appel-lees, and one of the grounds upon which the injunction granted them was sought. On this phase of the case there was no issue upon the facts, the evidence being undisputed that the construction of the ditches, unless enjoined, would take that quantity of appellees’ land under the conditions stated from the pleadings without prior payment. This condition alone would, we think, require affirmance of the trial court’s judgment.

But the threatened appropriation of a part of appellees’ lands without compensation first made, or so secured by a deposit in money, as required by article 1, § 17, of the Constitution, was not the. only right to injunction established by them; because it was further shown by amply sufficient evidence that appellants were about to damage, without adequate compensation being made, a very large part of the said lands, both within and without said drainage district. The lands were shown to be titled lands belonging to appel-lees, except possibly about Vio part of the whole, covered by the beds of the lakes and sloughs, which lay below mean tide, and were covered with a very valuable salt wire grass capable of wintering about 5,000 cattle per year — this being the only use of which the lands -were susceptible — and that the hastened precipitation of the large and increased volume of fresh water, which would be cast upon these lands by the proposed system of ditches, would kill this grass, and thereby practically destroy the sole value of the lands to appellees.

Even if it were held that a tender through the pleadings of payment for such damage was tantamount to “adequate compensation,” and hence met the specific requirement of said article 1, § 17, as to the damaging of property not taken, and that the district court in this suit had authority through its processes to have the amount of said compensation properly ascertained — neither of which do we hold — then appellants were still without the pale of these requirements, because the drainage district was shown to be insolvent, without funds or property or resources with which to make effective its said tender of payment, or out of which appellees could obtain compensation for any damage that might result to them.

The evidence was very voluminous, and it would serve no useful purpose to here detail it, but we deem it enough to say that it was amply sufficient to justify these conclusions, and to support the judgment of the trial court, especially since the trial was before the court without a jury, and no conclusions of fact or law were either requested or filed.

In its net results, therefore, the case thus made by appellants upon final trial was not materially different from that so passed upon by this court in affirming the order granting the temporary injunction, and the conclusions and authorities there stated are alike applicable here. Matagorda County Drainage District No. 5 v. Borden et al., 181 S. W. 780, and authorities there cited: Ft. Worth Imp. Dist. v. City of Ft. Worth, 106 Tex. 148, 158 S. W. 164, 48 L. R. A. (N. S.) 994; Sullivan v. Dooley, 31 Tex. Civ. App. 589, 73 S. W. 82; Gembler v. Echterhoff, 57 S. W. 313; Farnham, Waters, pp. 2574-2579, inclusive, also p. 2697; Ry. Co. v. Fuller, 63 Tex. 467; Richards v. Washington Term. Co., 233 U. S. 546, 34 Sup. Ct. 654, 58 L. Ed. 1088, L. R. A. 1915A, 887; Pumpelly v. Green Bay Co., 13 Wall. 166, 20 L. Ed. 557; Bradbury v. Vandalia Levee & Drainage District, 236 Ill. 36, 86 N. E. 163, 19 L. R. A. (N. S.) 991, 15 Ann. Cas. 904; Farnham on Waters, vol. 2, § 557; Broussard v. Cruse, 154 S. W. 347; Kingman Imp. Co. v. Bank, 153 S. W. 394; Kittrell v. Irwin, 149 S. W. 199; Daniel v. De Ortiz, 140 S. W. 486; Guerra v. Rodriguez, 120 S. W. 593; Appel v. Childress, 53 Tex. Civ. App. 607, 116 S. W. 129; Spalding v. Aldridge, 50 Tex. Civ. App. 230, 110 S. W. 566; Rossom v. Miller, 15 Tex. Civ. App. 603, 40 S. W. 861; Mutual Life Ins. v. Ford, 61 Tex. Civ. App. 412, 130 S. W. 769; McCoy v. Mayer, 21 S. W. 1015; Richter v. Mfg. Co. (Sup.) 174 S. W. 285, L. R. A. 1916A, 504; McGhee Ditch Co. v. Hudson, 85 Tex. 590, 22 S. W. 398; Mud Creek Irrig. Co. v. Vivian, 74 Tex. 170, 11 S. W. 1078; Canal Co. v. Markham Irrig. Co., 154 S. W. 1176; Gibson v. Carroll, 180 S. W. 630; Denny v. Cotton, 3 Tex. Civ. App. 634, 22 S. W. 122; City of Victoria v. Schott, 9 Tex. Civ. App. 332, 29 S. W. 681; Plummer v. Marshall, 59 Tex. Civ. App. 650, 126 S. W. 1162; State v. Texas, etc., Co., 34 Tex. Civ. App. 460, 78 S. W. 957; Goar v. Rosenberg, 53 Tex. Civ. App. 218, 115 S. W. 653; Rodriguez v. Hernandez, 35 Tex. Civ. App. 78, 79 S. W. 343.

It follows that the district court did not err in perpetuating the injunction, and its judgment will be in all things affirmed.

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