author: FLY, C. J.

text:
    COMMERCIAL STATE BANK v. VAN HUTTON.
    (No. 6142.)
    (Court of Civil Appeals of Texas. San Antonio.
    Jan. 15, 1919.)
    1. Set-Off and Counterclaim <&wkey;33(l)— “Liquidated” Claim — Statute.
    In suit against bank by clerk to recover deposit, bank could set off its claim against clerk for money which it was led to pay its customer through its teller on account of clerk’s negligence in having overstated balance to customer’s credit, bank’s claim being “liquidated,” Rev. St. 1911, art. 1329, as to set-off of unliquidated demands, not being applicable.
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Liquidated.]
    2. Mastee and Servant <&wkey;>53 — Negligence of Clerk — Liability.
    A bank’s clerk, who negligently reported a customer’s balance, so that the customer drew out more than he was entitled to, was liable to the bank for damages to it through his negligence, regardless of any liability of the customer.
    3. Damages <&wkey;163 (2) — Negligence of Em-plomé — Reduction of Damages — ¿Burden of Proof.
    When employer institutes suit against employs for damages through latter’s negligence, he is not called upon to prove he could not reduce damages by suit against another, in relation to whom employe’s negligence occurred, as that burden rests on the employe.
    4. Master and Servant <&wkey;66 — Action for Negligence — Parties.
    In- suit against bank by clerk to recover deposit, bank counterclaiming for damages when its customer withdrew more money than he was entitled to on account of negligence of clerk in stating balance to teller, estate of customer was a proper but not a necessary party.
    Appeal from Bexar County Court for Civil Cases; John H. Clark, Judge.
    Action by the Commercial State Bank against Edgar Yan Hutton. From judgment for plaintiff, defendant appeals.
    Reversed, and cause remanded.
    Taliaferro, Cunningham & Birkhead and Augustus McCloskey, all of San Antonio, for appellant.
    Ben P. Lane, of San Antonio, for appellee.
   FLY, C. J.

This action was begun in the justice’s court, where appellee recovered from appellant $100.99, being a deposit made by appellee in the bank. The cause was appealed to the county court, where appellant filed the following pleading:

“And for special answer, and continuing defendant’s cross-action heretofore filed in the justice court, this defendant says that plaintiff was in its employ in a clerical capacity in the bank, and that by and through his gross negligence and carelessness J. H. Rittiman, who resided in Bexar county, Tex., and who has been made a party hereto and has duly answered, was permitted to overdraw his account to the extent of and in the sum of $100.20 to the defendant’s damage in said sum.
“The acts of the plaintiff herein in causing and permitting the said J. H. Rittiman to overdraw his account in said sum of $100.20 was such misconduct as amounts to treachery, in that plaintiff wholly failed to recognize the duties and responsibilities imposed upon him by his situation and for which he was duly liable, in that, when said J. H. Rittiman or his agent asked the plaintiff in his capacity as clerk for this defendant the amount of his deposit in the bank, the plaintiff gave to the said Rittiman a written memorandum showing that said, Ritti-man had the sum of $100.20 more to his credit than the books of said bank at that time showed, and the said plaintiff knew at such time that said slip showing the amount of the deposit to the credit of the defendant Rittiman would be relied upon and paid by the paying teller at said bank, and that said paying toller did rely upon the same and did pay out on the check of the said J. H. Rittiman the sum of $100.20 more than he had on deposit in said bank at, said time; that said, act was inexcusable, in that the books of the bank at that, time showed the correct amount due and owing to the said Ritti-man to be the sum of $278.29, whereas, the said plaintiff wrote on the slip which he gave to Mr. Rittiman’s agent the sum of $379.49, and for which act there can be no excuse except gross negligence or a willful failure to assume the responsibilities of his position.”

That pleading was assailed by special exceptions on the ground that appellee’s claim was liquidated, “and it appears from said defendant’s answer and cross-action that he is attempting to offset and bring cross-action for damage for an uncertain and unliquidat-ed amount growing out of the alleged negligence or tort on part of plaintiff, and not growing out of or connected with plaintiff’s cause of action.” The exceptions were sustained, and the court rendered judgment in favor of appellee for $100.99.

Article 1329, Rev. St., provides:

“If the plaintiff’s cause of action be a claim for unliquidated or uncertain damages, founded on a tort or breach of covenant, the defendant shall not be permitted to set off any debt due him by the plaintiff; and, if the suit be founded on a certain demand, the defendant shall not-be permitted to set off unliquidated or uncertain damages founded on a tort or breach of covenant pn the part of the plaintiff.”

In this case the suit is founded on a certain demand, and the only question is as to whether the claim of $100.20 accruing to appellant through the negligence of its servant is unliquidated or uncertain and founded on a tort or breach of covenant. The words “un-liquidated” and “uncertain” are separated by the disjunctive “or,” and it might be implied that each refers to a different class of demand ; but the words are practically synonymous. Whenever-a claim is liquidated it is “ascertained, determined, fixed, settled, made clear or manifest.” Black’s Law Dictionary. In other words, when “liquidated” a claim is “certain,” and'vice versa. As said in a case cited by Black:

“A demand is a liquidated one, if the. amount of it has been ascertained — settled—by the agreement of the parties to it, or otherwise.” Mitchell v. Addison, 20 Ga. 53.

To the same effect is Jones v. Hunt, 74 Tex. 657,12 S. W. 832, which adopts a definition given by the Georgia court to the effect that a debt is liquidated “whenever the amount due is agreed upon by the parties or' fixed by the operation of law.” That was said in a case in which damages arising from conversion were sued for, and it was attempted to offset the damáges with amounts shown by promissory note and accounts for merchandise. The suit was for a certain sum converted by defendant, and the court said:

“In the case before us we do not think the amount that plaintiffs were entitled to recover on the establishment of their cause of action was either uncertain or unliquidated. The amount was fixed by law. It could be precisely ascertained by a mathematical calculation and did not depend upon the evidence of witnesses.”

So in this case the amount is fixed by law. It is the amount lost by the bank through the negligence of appellee, or it is nothing. It is a fixed, certain, liquidated amount.

The statute does not provide that no claim founded on a tort or breach of covenant can be set off against a certain demand, but only “uncertain or unliquidated damages” founded on such tort or breach of covenant can be so set off. In other words, to prevent the set-off, the claim must not only be founded on a tort or breach of covenant, but it must also be uncertain or unliquidated. The rule of the civil law is:

“Compensation is a reciprocal acquittal of debts between two persons who are indebted the one to the other.”

But as quoted in Howard v. Randolph, 73 Tex. 454, 11 S. W. 495:

“It is not enough to make compensation, that there be a debt on the one side and the other, but it is moreover necessary that both the debts be clear and liquid; that is, certain and not liable to dispute.”

By the expression “not liable to dispute” is not meant that the debts to be offset are admitted by the respective parties, but that the amount is certain or liquidated. If a party ' seeks to offset one promissory note against another, either note may be disputed; but, each being certain in amount, one may be set off against the other. The uncertainty in view is as to the amount, which would depend upon the assessment by a court or jury, and not fixed or ascertained. In the case now under consideration, the, amount pleaded in offset by appellant was just as certain as that upon which the suit was declared. Appellee in order to recover was compelled to prove that he had money on deposit with appellant, which had been refused him, and appellant to establish his demand had to prove that by his negligence appellee had become indebted to appellant in a certain fixed sum. Harrington Lumber Co. v. Smith, 44 Tex. Civ. App. 363, 99 S. W. 110; Railway v. Hurless, 1 White & W. Civ. Cas. Ct. App. § 582.

The matter of the insolvency of Ritti-man, the party who 'drew the money to which he was not entitled, was alleged, and his estate, he having died, was made a party; but these matters were not necessary to a recovery against appellee for his misfeasance as an employé. He was liable for the damages accruing to his employer through his negligence regardless of any liability upon the part of Rittiman. 18 R. C. L. §§ 270, 271; Mechem on Agency, § 1293.

When the employer institutes a suit against the employé for damages arising from the negligence of the latter, he is not called upon to prove that he could not reduce the damages by a suit against another or otherwise; but that burden must rest upon the employé. It may be, as in this instance, that some one else may also be liable; but, if so, the employé, and not the employer, should be compelled to recoup himself from the other party.

“When the principal shows that through-the agent’s negligence he has been obliged to pay money, or that his property has been injured or destroyed, .it is clear that, unless the agent proves facts that would reduce the apparent damage, the principal can recover the whole amount of his payment, or the whole value of his property. The burden is on the agent to reduce the damages.” Sedgwick on Damages, §§ 674-814. __

The court in the decree held that the estate of J. H. Rittiman, deceased, was “not a necessary and proper party in this suit,” and from his viewpoint that is doubtless a legitimate conclusion, because, if there was no cross-action against appellee, Rittiman was not a proper party. However, this court is of the opinion that the estate, as represented by the independent executrix, was a proper party to the suit, but not a necessary one. Appellee, under the allegations, had .caused a loss to appellant of $100.20, independent of the acts of any one else, and appellant has the right to hold him alone liable, and, if he desires to ascertain whether the amount paid to Rittiman can be recovered from his estate, the burden of recovering from the estate should be placed on the negligent servant and not on the unoffending master.

The judgment is reversed, and the cause remanded, to be tried as herein indicated.
      <S=oFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

license: Public Domain

text:
    STOWERS v. H. L. STEVENS & CO. et al.

    (No. 6128.)
    (Court of Civil Appeals of Texas. San Antonio.
    Jan. 8, 1919.
    Rehearing Denied Feb. 5, 1919.)
    1. Evidence <&wkey;208(6)—Admissions—Aban-doned Pleadings.
    An abandoned supplemental petition, filed by plaintiff, is admissible in evidence against him, notwithstanding it contained legal conclusions, for the averments in the petition were admissions of the plaintiff.
    2. Contracts <5&wkey;352(2) — Building Contracts—Issues.
    In an action for contractor’s breach of agreement, the submission of the issue as to whether plans of the building were drawn by the contractor, or by its agent under the direction of the agent of a lessee, who was a party to the contract, held proper under the evidence.
    3. Appeal and Ekbor &wkey;>742(l)—Assignment op Erkob—Sufficiency.
    A reference in an assignment of error to a page of the record for a bill of exceptions, without giving it in full or at least the substance, is not the statement contemplated by rule 31 (142 S. W. xiii), and such assignment is defective.
    4. Contracts &wkey;>303(5) — Building Contracts—Default op Other Party.
    Where a tripartite agreement, between the owner, a contractor, and the prospective lessee of the building to be erected, provided that the building should be erected at a cost-not to exceed $125,000, and that it should- be built ac- f cording to designs of the lessee’s agent, held,. that the contractor was not bound to erect the building, where the plans prepared by the lessee’s agent could not be carried out, save at an expenditure greater than $125,000; every part of the agreement being binding on each of the parties.
    Appeal from District Court, Bexar County; .1. T. Sluder, Judge.
    Action by G. A. Stowers against H. L. Stevens & Co. and another. From a judgment for defendants, plaintiff appeals.
    Affirmed.
    Terrell & Terrell and Denman, Franklin & McGowan, all of San Antonio, for appellant.
    Edwin H. Cassells, of Chicago, Ill., Ball & Seeligson, of San Antonio, and Hunt & Tea-gle, of Houston, for appellees.

      writ of error denied by Supreme Court March 26, 1919.

   FLY, C. J.

This suit was instituted by appellant against H. L. Stevens & Co. and the United States Fidelity & Guaranty Company, to recover the sum of $62,003.34 from the former and $60,000 from the latter, alleged to have accrued by a breach of a contract by the former to construct a certain building in the city of San Antonio, on which contract the United States Fidelity & Guaranty Company was a surety in the sum of $60,000. It was alleged that on May 2, 1912, appellant entered into a contract with Stevens & Co., whereby that firm agreed to design, erect, and build, for appellant, a certain building on Main avenue, near the corner of West Houston street, in the city of San Antonio, according to plans and specifications prepared by said Stevens & Co.; that by the terms of said contract the entire building should not exceed in cost the sum of $180,000; and that at the time of the execution of said contract a bond was executed by H. L. Stevens & Co., as principal, and the United States Fidelity & Guaranty Company, as surety, for the faithful performance of the terms of said contract, in the sum of $60,000. A breach of the contract and a failure to complete the building was alleged, and that such breach compelled appellant to complete the building at an additional cost to him, over and above the $180,000, of $62,003.34, for which he prayed judgment.

The contractors answered, admitting the execution of a certain building contract, but pleaded that in addition, upon what is denominated the “Minutes of an Agreement,” of date May 2, 1912, upon which the suit of appellant was based, there were certain writings on the plans, and a certain lease agreement between appellant and Karl Hoblitzelle, representative of the Interstate Amusement Company, which was referred to and made a part of the plans. It was pleaded that the three agreements mentioned were a part of the same transaction, and entered into and became the contract of agreement made by appellant and H. L. Stevens & Co., for the latter to erect a certain furniture and theater building, the furniture building being first erected and then the theater, which in style and architecture should conform to the furniture building, and that by the terms of the contract, taken as a whole, the theater building was not only to conform to the previously erected furniture building, but the plans and specifications of said theater building were to be designed by said Karl Hoblit-zelle, and it was to be built subject to his approval, the latter building not to cost in excess of $125,000, the cost of both buildings not to exceed $180,000. It was also answered by H. L. Stevens & Co. that the plans furnished by Hoblitzelle called for the erection of a theater building that would cost much more than $125,000, and appellant refused to furnish the excess, but demanded that the contractors should furnish the same. The cause was submitted on special issues, and on the answers returned thereto judgment was rendered in favor of appellees.

The basis of the suit, which was introduced in evidence, was the following instrument:

“Minutes of Agreement.
“Made' this 2d day of May, 1912, between H. L. Stevens & Co., architectural engineers, of Chicago, Ill., and Houston, Tex., and G. A. Stowers, owner, of San Antonio, Tex.
“It is mutually agreed that H. L. Stevens & Co. will design and construct for the owner a certain building in accordance with plans and specifications submitted to the owner by H. L. Stevens' & Co.
_ “It is agreed that for the design and construction of such building the owner will pay cost plus 10 per cent., and that on the 1st day of the month H. L. Stevens & Co. will render the owner a statement covering the cash expenditures and bills incurred on account of this work during the previous month, and the owner will promptly pay H. L. Stevens & Co. the amount of such statement plus 10 per cent.
“It is agreed that H. L. Stevens & Co. will furnish the necessary mixers, boilers, and engines, which shall not be charged as part of the cost of the work. However, the installation and maintenance of such machinery, the transportation of machinery and men, the cost of such other tools as may be required, and the office, drafting, and incidental expense of this work shall be considered as part of the cost of the ,worlc.
‘.‘In consideration of the payments as herein ipentioned, II. L. Stevens & Co. guarantee that the cost of said building, including their percentage, shall not exceed the sum of $180,000, and if it does exceed such sum they will assume and pay such excess cost.
“H. L. Stevens & Co. will, if required, furnish a surety bond in the form attached as a guaranty that they will comply with the terms of this agreement. The premium on such bond to be considered as part of the cost of the building. Workmanship and materials to' be subject to approval of said Stowers or his agent.
“H. L. .Stevens & Co.,
“By H. L. Stevens.
“G. A. Stowers, Owner.”

In addition there was introduced in evidence a certain lease contract, entered into ■by and between Hoblitzelle, for the Amusement Company, and appellant, in which was the following provision:

“The material and workmanship and finish of said theater portion of said building shall be first-class in every respect, but the cost of the theater portion of said building shall not exceed $125,000, and this amount shall include the installing of opera chairs, $1,000 to be paid to Seuter & Shands as auditors and supervising architects, $4,000 which is hereby agreed upon as interest on the money being invested in said premises during the construction of the building, and 10 per cent, of the actual cost of construction, which will be paid to the said H. R. Stevens & Co., or other contractors, as their salaries upon the construction of said building.”

Again, in another parti of the lease contract it is provided that the cost of the theater should not exceed $125⅜000. The lease •contract was reduced to writing and signed very shortly after the “Minutes of Agreement,” herein referred to, was signed. Before the signing of the building contract, Stevens, Stowers, and Hoblitzelle had a conference at which the following was indorsed on the plans of the building:

“Theater construction included in the guaranteed cost to be that included in the lease between owner and lessee. Theater interior, both structural and ornamental, to-be designed and built under the directions and subject to the approval of lessee, provided such guaranteed cost is not exceeded, Hoblitzelle to represent the lessee.”

All of the agreements were made on the same day. The only plans in existence at the time of the execution of the agreements were the sketches from which afterwards were prepared certain blueprints, and on the original pencil sketches was written what are called the “Notes,” parts of which were dictated by Stevens, Stowers, and Hoblitzelle, respectively; that as to the cost being same as named in the lease contract being written in by Stevens with the concurrence of the other parties. It was admitted by appellant in his pleadings that all agreements between him and H. L. Stevens & Co. were merged into and became a part of the “Minutes of Agreement,” dated May 2, 1912, the blueprints of the plans, with the indorse-ments thereon, the lease contract, the contract between appellant and the contractors, dated May 3, 1912, and the bond of the United States Fidelity & Guaranty Company of same date.' The contractors failed and refused to finish the theater building, because Hoblitzelle desired to have plans carried into execution which would have entailed a large additional cost to the $125,000 provided for in the contract.

The first assignment of error complains of the admission in evidence of an abandon- ' ed supplemental petition. The grounds of objection are that the pleading stated “legal conclusions and opinions of the pleader, and not facts, and because it was an abandoned pleading and had no probative force or effect.” The assignment cannot be maintained. It has been definitely settled by the courts of Texas that abandoned pleadings may be received in evidence against the party responsible for them, and the fact that the pleadings may have contained legal conclusions would not change the rule. The pleadings, however, involved the intention of the parties to the contract, and showed the construction placed by appellant upon the different papers executed by the parties. Barrett v. Featherstone, 89 Tex. 567, 35 S. W. 11, 36 S. W. 245; Railway v. De Walt, 96 Tex. 121, 70 S. W. 531, 97 Am. St. Rep. 877. The admissions were not oníy made in the pleadings, but wei-e made, without objection, by appellant on the stand, and the same facts were testified to by Stevens and Hoblitzelle.

The second assignment of error com- . plains of the submission of the issue as to whether certain plans of the theater building were drawn by the contracting company, or by its agent, under the direction of Hoblit-zelle. The proposition under the assignment is too general and indefinite for consideration, and the statement fails to relieve it of its generality. It may be stated, however, that appellees did not admit in their answer, as claimed by appellant, that Hoblitzelle was to pay any excess over and above the $125,000 provided for in the contract. The contract indicated that Hoblitzelle was to design the interior of the theater and direct the construction of it. The testimony of Stevenson, the man who finished the theater, showed that the plans were developed in accordance with directions received from the Chicago office, and also directions received from Mr. Hoblitzelle, either from the Chicago office or personally. He also stated:

“These plans largely germinated in the brain of Hoblitzelle. I know they were worked out absolutely in response to repeated requests from him.”

Appellant claimed that the plans were made entirely by the contractors, and it was a material issue as to whether they were so prepared, or under the direction of Hoblit-zelle. The latter claimed that he designed the plans, and the theater was to be built under his direction.

The third assignment of error is indefinite and uncertain, and is not cleared up and made specific by the proposition and attempted statement. The latter is totally inadequate and contrary to rules enforced in a number of decisions. A reference to a page of the record for a bill of exceptions, without giving it in full, or at least in substance, is not the statement contemplated by rule 31 of this court (142 S. W. xiii). Broussard v. Rice Co., 120 S. W. 587.

The fourth and fifth assignments of error are like unto the third, and subject to the same objections, and cannot be considered.

In the sixth'assignment-of error appellant seeks to separate himself from his lessee, the Interstate Amusement Company, as represented by its agent, I-Ioblitzelle; but this cannot be done. - He brought the lessee into the case, he agreed to its agent giving the design for the theater and superintending its erection, and he cannot evade his responsibility and force the contractors to take up the burdens arising from the injection of the lessee into the contract. Neither could the agent of the lessee, who .had been authorized and empowered to frame the designs-for the theater, cause the contractors to incur liability by a failure to make designs for the building. He, however, did give plans for the building which made it impossible for the contractors to execute the contract, apd the breach of the contract came through Hoblit-zelle, seconded by appellant. This would be true under either alternative.

The sixth assignment is overruled, as well as the seventh and eighth, which in substance involve the same matters. Hoblitzelle failed and refused to approve plans within the terms of the contract, and thereby rendered it impossible for appellees to finish the building. The breach of the contract was brought about by the refusal of Hoblitzelle to furnish such plans, although he persisted in directing matters contrary to the plans formulated by the contractors, and absolutely refused to approve any and all plans submitted by H. L. Stevens & Oo. The building was at last completed by Stevenson, who took up the work after Stevens & Oo. left it, under plans approved by Hoblitzelle, which he had rejected in 1912, which were aided by plans' presented by Mitchell & Halbach. Those plans necessitated an expenditure much in excess of the $125,000 for which provision was made in the contract.-

The seventh, eighth, ninth, tenth, eleventh, twelfth, thirteenth, and fourteenth assignments of error present nothing, except that the court should not have presented certain issues, because not raised by the evidence, and that the answers of the jury thereto are not supported, by the -eyidence. As here-inbefore indicated, we have concluded that the issues were material - and the answers sustained by the evidence, and the assignments will be overruled. The testimony of H. L. Stevens, which- was credited by the jury, is as follows:

.“I suggested a number- of ways by which the theater might be finished for $125,000. It is a fact that I could have finished a theater first-class in every respect for $125,000, and it would have been a more attractive theater than the Empire Theater in ,San Antonio. I could not have, built a building for $125,000 following the plans that Mitchell & Halbach and Hoblitzelle were insisting on. There was never a time when I was not willing to go ahead and construct a building within the $125,000. Hoblitzelle never would agree to anything but what was demanded-in this perspective; he wouldn’t consider anything else. At the time Mr. Stowers finally took charge personally, with .reference to completing the work, I was endeavoring with both Mr. Stowers and Hoblitzelle to get some arrangement by which we could go-on. . I had to have -information from Hoblitzelle that would allow us to go ahead. I did not get information from Hoblitzelle that would allow us to go ahead.”

A tripartite agreement was made by the parties, and each and every part of that agreement was equally binding upon each of the parties. H. L. 'Stevens must erect the theater at a cost to appellant of $125,000; that house must be designed ahd the building of it superintended by Hoblitzelle. The last-named, of course, could not design a building that would cost more than $125,000, for that was the limit to be paid for the house, and Hoblitzelle was in duty bound to-design a" theater that could be built for those figures. If he could have required the contractors to buiid a house for any amount above the specified sum, he could have bankrupted them by making such extravagant designs .as were never contemplated in the agreement. Appellant was under no obligation to pay more than the limit named in the contract, appellees were not bound to erect a building that would cost more than that price, and Hoblitzelle was bound to submit -designs that would not require the expenditure of more than that sum.

The other assignments of error are overruled. There are no questions of importance in this case, except those of fact, and consequently the authorities cited are not pertinent-or applicable. The questions of fact were fully presented by the court to the jury, and every issue was resolved in favor of ap-pellees upon sufficient evidence.

Upon a cross-action for an amount of money due them, H. L. Stevens & Oo. recovered of appellant the sum of $8,197.87, and the-United States Fidelity & Guaranty Company recovered of H. L. Stevens the sum of $2,-500 as attorney’s fees, and no reasons have been presented why those findings should be-disturbed.

The judgment is affirmed.
      &wkey;>For other cas^s see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: HUFF, C. J.

text:
    SCHLAG v. JOHNSON et al.
    (No. 1447.)
    (Court of Civil Appeals of Texas. Amarillo.
    Jan. 15, 1919.)
    1. Contracts <©=117(3) — Monopolies <©=12 (4) — Agreement Not to Engage in Business in Town.
    Contract whereby partner engaged in plumbing and windmill business, retiring from firm in favor of another, agreed not to engage in business in town in competition with his old and the new partner, held not void at common law as against public policy, nor as establishing trust, monopoly, or conspiracy in restraint of trade as defined and denounced by Kev. St. 1911, arts. 7796-7798, nor evidencing combination of capital, skill, or acts to accomplish things forbidden.
    2. Appeal and Error <©==>907(3)— Absence oe Statement op Facts — Presumption.
    In absence of statement of facts on appeal, presumption will be indulged in favor of trial court’s judgment, and that it had evidence to support it.
    3. Pleading <©=349 — Judgment on Pleadings and Admission — Absence óf Evidence.
    In suit to restrain defendant from pursuing business in town contrary to his agreement when he left firm which took in another member in his place, held that court erred in rendering judgment enjoining defendant, without any evidence being introduced, on pleadings and admission in paragraph of answer.
    4. Evidence <©=432 — Pabol Evidence Contradicting Writing — Consideration.
    Recitation of consideration in contract, whereby defendant agreed not to engage in his former business in town, being contractual, evidence that there was no consideration for agreement not to engage in business would be inadmissible in suit to enforce agreement, in absence of allegation of fraud or mistake.
    Appeal from District Court, Donley County; Hugh L. Umphres, Judge.
    Suit by F. A. Johnson and another against D. J. Schlag. From judgment for plaintiffs, defendant appeals.
    Reversed and remanded'.
    H. B. White, of Clarendon, for appellant.
    A. T. Cole, of Clarendon, for appellees.
   HUFF, C. J.

This is an appeal by Schlag from a judgment enjoining and directing him to desist from further pursuing a certain business and avocation in the town of Clarendon, Tex., in competition with F. A. Johnson and W. C. Stewart. "The case is here alone on pleadings and judgment. F. A. Johnson and W. C. Stewart sued as a partnership under the firm name of Johnson & Stewart, alleging that since the 5th day of April, 1917, they were in the business of plumbing and furnishing and repairing windmills, and in the sale of plumbing wares and parts thereof, in the town of Clarendon, and that they had been engaged in the business for many years; that prior to that date for many years plaintiff Stewart had been in the same business alone, and that for more than a year prior thereto plaintiff Johnson and the defendant Schlag- had been in the same business, in the town, as partners, under the firm name of Johnson & Schlag; that on the 5th day of April, 1917, the plaintiffs entered into a partnership, and purchased, of the defendant all his interest in the partnership business then and theretofore conducted by the firm of Johnson & Schlag, paying him therefor the sum of $1,482.65, and also as part of the consideration paid them assumed and agreed to pay bills owing by the firm of Johnson & Schlag, and as part of the consideration above paid and assumed by the plaintiff the defendant agreed that he would not again enter into-the plumbing business in said town of Clarendon, nor into the windmill business in said town of Clarendon, and, further, he agreed that he would neither sell the wares belonging to either business or trade, and that he would not again work at either trade, and never again in the town directly or indirectly engage in either business. The contract or bill of sale is as follows :

“For and in .consideration of the sum of $1,482.65, to me paid by F. A. Johnson and W. C. Stewart, I hereby bargain and sell and by these presents do bargain and sell and deliver to the said F. A. Johnson and W. C. Stewart, all of my interest in and to all of the goods, wares and merchandise of every kind whatever, including all store and office furniture and fixtures belonging to the said Johnson and D. J. Schlag, firm doing business under the. firm name of Johnson and D. J. Schlag, and in the C. Benson building on the west side of Ker-ney street, in block 7, in Clarendon, Texas, also all -of the accounts belonging to the firm of Johnson & Schlag, the said F. A. Johnson and W. C. Stewart hereby assuming and agreeing to pay all accounts due by the firm of Johnson & Schlag. It is part of the consideration of this sale, that I, the said D. J. Schlag, hereby obligate myself under proper penalties, that' I will not again enter into competition in the plumbing and windmill business or sale or work, either directly or indirectly, in Clarendon, Texas, and I do so contract and agree and acknowledge that a part of the purchase price herein and above set forth is this obligation upon my part not to so enter again into competition with the said parties. The title to the above property, I warrant and defend. Witness my hand at Clarendon, Texas, this April 5, 1917. Witness: G. P. Arington. [Signed] D. J. Schlag.”

It is alleged that it was understood the moving cause of the purchase of defendant’s interest in the business was the defendant would not enter again into business in said town in competition with them; that defendant knew that plaintiffs had long been ⅛ business in tlie town, and intended so to continue therein, under the partnership mentioned, for profit, and knew. that plaintiffs paid the sum to him for the purpose of releasing themselves of his efforts and competition in said town for all time, and, so knowing, executed the writing, by the terms of which he bound himself never again to enter directly or indirectly in said town into the business so purchased. They then allege that he had breached the contract by entering into competition, and threatened to continue to do so, and disregarding his obligations in the contract. They sued also for $000 damages, and sought an injunction, restraining him from pursuing the occupation and business. The petition was not sworn to, and no temporary writ was granted or prayed for. The defendant answered by general and special exceptions. The special exceptions are to the effect that the contract is in violation of the anti-trust and monopoly laws of Texas, and that the contract is void in that the time limit is not to any number of years or space of time, and that the contract is against public policy, in that it is shown that the plumbing business is a useful business in which the public of Clarendon was interested, and that it was unreasonable in its requirements, and in that particular was contrary to the common law. The appellant also answered by general denial, demanding strict proof, and further specially answered:

“(¾ While defendant admits that he signed the contract as set out. in plaintiffs’ petition, yet he would nevertheless show to the court that there was no consideration for that part of said contract in which it was stipulated that lie would never again engage in the plumbing business in said town of Clarendon, in competition with plaintiffs; that the consideration mentioned in said contract represents the agreed invoice value of defendant’s interest in the stock of plumbing wares, tools, etc., which plaintiffs paid him in exchange for his said interest, and therefore there was and is an utter absence of any consideration whatsoever for that part of said contract just mentioned.”

And by further special answer that he and Stewart were the only master plumbers In the town of Clarendon, and that the town was in need of the plumbers, alleging that a great per cent, of the inhabitants of the town were using the sewer and waterworks, which required the business of master plumbers, and that there was sufficient work for them, and he alleged that Stewart was either incompetent or negligent, and that the citizens of the town had to apply to outside sources for competent plumbers, etc. He alleges the war brought about conditions making it hard to obtain plumbers, and that the contract was unreasonable in restricting the town of Clarendon to one master plumber, etc. The plaintiffs, by supplemental petition, filed August 3, 191S, alleges that they were entitled to the injunction prayed for in their original petition, on the answer filed therein- during the month of January, 1918; and one filed July 29, 1918, and, further, they waived and disclaimed by their supplement all pecuniary damages “herein that action may be had hereon.” The judgment is dated August 3, 1918, reciting that plaintiff answered ready for trial, but defendant announced not ready, and presented his motion for continuance, which was overruled. The exceptions presented by appellant were also overruled, and the judgment then recites:

“Whereupon, no further pleas and demurrers and motions of defendant being urged, the cause proceeded to trial, and the pleadings were read to the court, and the court being of the opinion that the admissions contained in paragraph 5 of defendant’s answer authorized and requires that the relief prayed for in plaintiff’s petition should be granted. Plaintiffs having waived ail claims for damages, it is therefore ordered and decreed by the court that plaintiffs, F. A. Johnson and W. C. Stewart, do have and recover against defendant, IX J. Schlag, the injunction prayed for in plaintiffs’ petition”

—and then proceeded to decree the injunction.

The appellant presents several assignments, raising practically the same issues raised by his exceptions to plaintiff’s original petition. While in one or two places the petition alleges appellant was “never again” to enter into the business or trade, it is apparent, we think, that appellees claim no right except for a breach, or threatened breach, of the contract set out in full in the petition, and .upon which they base their right. The contract, in our opinion, is subject to no such interpretation, but limits the restriction to the town of Clarendon and to competition with appellees in the line of business bought and sold. Their right to damages and to the injunction was based on the breach of the contract, and could have been had upon no other. Apparently appellant concedes that the limitation or restriction as to territory is not unreasonable, but asserts the contract is unlimited as to time or is unrestricted as to duration. The restriction as to time is not definite, but we do not think the duration of the restriction unlimited. The contract provides that appellant is “not to so enter again into competition with said parties” (appellees). This is further limited to the plumbing and windmill business in the town of Clarendon. Appellant in his brief asserts the contract is a restriction for all time. Obviously this is incorrect.

It is our view the contract as set up and under the allegations is not void at the common law or against public policy. The Supreme Court of the United States has said:

“It is well settled that a stipulation by a vendee of any trade, business, or establishment that the Vendor shall not exercise the same trade or business, or erect a similar establish-meat within a reasonable distance, so as not to interfere with the value of the trade, business, or thing purchased, is reasonable and valid.” Oregon v. Winsor, 20 Wall. 64, 22 L. Ed. 315.

The courts of this state have followed the rule thus announced in a variety of cases. Gates v. Hooper, 90 Tex. 563, 39 S. W. 1079; Crump v. Ligon, 37 Tex. Civ. App. 172, 84 S. W. 250; Comer v. Burton, 24 Tex. Civ. App. 251, 58 S. W. 969; Erwin v. Hayden, 43 S. W. 610; Anderson v. Rowland, 18 Tex. Civ. App. 460, 44 S. W. 911; Patterson v. Crabb, 51 S. W. 870; Tobler v. Austin, 22 Tex. Civ. App. 99, 53 S. W. 706; Wolff v. Hirsehfeld, 23 Tex. Civ. App. 670, 57 S. W. 572; Forrest Photo Co. v. Hutchinson Grocery Co., 108 S. W. 768; Norton v. Thomas, 99 Tex. 578, 91 S. W. 780; Nickels v. Prewitt Auto Co., 149 S. W. 1094; Woods v. American Brewing Ass’n, 183 S. W. 127. The terms of the contract in Question, in its essential stipulations, are very much the same as those in the contract in the case of Malakoff v. Riddlesperger, 133 S. W. 519; same case on certified question to Supreme Court, 192 S. W. 530, and memorandum opinion, 194 S. W. 1182; Crump v. Ligon, supra. The contract on its face will not establish a trust as defined in article 7796, Rev. Civ. St. It does not evidence a combination of “capital, skill or acts” for the purpose of accomplishing the things named under the seventh subdivision thereof. The petition alleges that a partnership was formed between Johnson and Stewart, who had theretofore been in separate business establishments. The partnership so formed is not shown by the pleadings to have been organized by the union of capital, skill, or acts for the purpose of the restriction of trade Or commerce or the free pursuit of any business or to affect the prices or to lessen competition, or to fix and maintain a standard, or by agreement not to sell or to keep it at fixed graded figures, or to fix or limit the output of articles, or to abstain from or continuing any business, etc. The union or association is not shown to have been formed for any or either of such purposes. The mere fact that appellees entered into partnership relations does not, in our opinion, allege a combination denounced by the statutes. Partnerships, as such, are not illegal, but authorized by law. If there had been an agreement entered into by the two businesses, by virtue of which any of the things forbidden by law were sought to be accomplished, it would have been a trust, and illegal. The following cases are illustrations of such illegal combinations: Crandall v. Scott, 161 S. W. 925; Smith v. Kousiakis, 172 S. W. 586; Robinson v. Levermann, 175 S. W. 160, and authorities cited. The purpose of the bill of sale was to evidence a sale and purchase of the interest of appellant and of payment to him of a consideration for his good will in the increment attached thereto, by appellant’s personal influence and labor, and to stipulate that he should secure the value of such purchase to appellees, and to this end he agreed not to enter into competition with his vendees. This did not evidence a union of capital, skill, or acts, but was just the opposite. They each held their capital, skill, or acts in severalty and not in union. One sold and the other bought -this adjunct to the business which appellant regarded as a thing of value and subject to sale, as does also the law. The appellees liave a reasonable right to the benefit of that which they bought and paid for. Under article 7797 this transaction as alleged was not a monopoly; that is it does not evidence a consolidation of two or more corporations. We do not think that the contract evidences a conspiracy in restraint of trade, denounced by article 7798; that is, an agreement to refuse to buy from or sell to any other person, firm, ete., any article of merchandise, "or to boycott other persons. The above article evidences that an agreement between two distinct entities must be entered into under an agreement not to sell to another person or Arm, but the contract in Question is simply a sale of that trade and confidence attached to the business with which appellant had been connected, and to secure the fruits of the sale to his vendees he stipulated he would not enter into competition with the business sold in that town. This was a reasonable requirement; otherwise such thing would not have been secured to the vendees, and would have been of no value. We believe the trial court ruled correctly in overruling the several exceptions.

The fifth assignment assails the action of the court in rendering judgment enjoining appellant without any evidence being introduced. The appellees insist, in the absence of a statement of facts, the presumption will be indulged in favor of the court’s judgment, and that it had evidence to support it. As a rule this is true, but in this case appellant, by his supplemental petition, asked the court to render the judgment on the pleadings, and as an inducement thereto disclaimed any right to.recover the damages sustained. The judgment specially states that it was rendered upon hearing the pleadings and the admissions contained in the fifth paragraph of appellant’s answer. This admission was that appellant signed the contract, but it further alleges that the reservation contained in the contract was without consideration. The appellant by his pleadings did not admit that he had violated his contract or had threatened to do so. These facts were required to be established by the evidence before a writ could issue. The pleadings were unsworn, and no temporary writ hadi been issued or granted. The case stood for trial upon the issues made by the pleadings. The appellant had filed a general denial. We think, therefore, the court was in error in rendering judgment on. the pleading and the admission as contained in paragraph 5 of the answer.

Before closing this opinion we will state that in our opinion the contract shows that the money paid by appellees for the business and for the reservation was the consideration for the reservation so bought and sold. This recitation is more than a mere receipt for the money; it is in its nature contractual; and, unless there is an allegation of fraud or mistake in so writing the contract, the evidence that there was no consideration would not be admissible. MalakofC v. Riddlesperger, 194 S. W. 1182; Matheson v. C-B Live Stock Co., 176 S. W. 734; James v. Doss, 184 S. W. 623.

We shall not discuss the effect of the remaining part of appellant’s answer. Eor the reason above suggested, we believe the case should be reversed and remanded.
      <©=Nor other,cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author:
ROLLINS,. Special Chief Justice. BOYCE, J.
      HALE, J. ROLLINS, Special Chief Justice. HALL, J.

text:
    CALIFORNIA STATE LIFE INS. CO. v. KRING.
    (No. 1367.)
    (Court of Civil Appeals of Texas. Amarillo.
    Oct. 30, 1918.
    Dissenting Opinion, Nov. 20, 1918.
    On Motion for Rehearing, Jan. 8, 1919.
    On Second Motion for Rehearing, Feb. 5, 1919.)
    1. Insurance <©=>676 — Insurance Company —Acquisition of Other’s Assets and Lia- ■ bilities — Statute.
    Petition, in life insurance company’s suit on premium note acquired by having taken over all assets and liabilities of another company, held not demurrable as showing that transaction whereby note was acquired was not authorized by Rev. St. 1911, art. 4737, providing any life insurance company may reinsure, therefore repugnant to anti-trust statutes, articles 7797, 7807.
    2. Monopolies <©=>23 — Acquisition in Violation of Law.
    If transaction, whereby one life insurance company acquired assets and liabilities, including premium notes, of another, illegal as in violation of the anti-trust statutes (Rev. St. 1911, arts. 7797, 7807), was executed, title to premium note passed, s6 that acquiring company could enforce it against maker.
    Hall, J., dissenting.
    3. Contracts <©=>141(1) — Presumption op Legality.
    Unless the facts alleged clearly show that a contract was unlawful, it will be presumed that it did not violate the law. (Per Boyce, J.)
    4. Evidence <©=>88 — Presumption op Continuation dp Status — Innocence.
    The presumption of continuation of a status is weaker than the presumption of innocence in making a contract which might possibly be construed as illegal. (Per Boyce, J.)
    5. Bills and Notes <©=>4G7(2) — Action — Pleading.
    Under Rev. St. 1911, art. S82, providing-assignee may sue in his own name, in an action on an assigned note, it was not necessary that the pleader state in detail the circumstances of the .transfer of the note, though it was not indorsed. (Per Boyce, J.)
    6. Contracts <©=>136 — Illegality—Statute —“Void.”
    Though “void” involves the idea of utter ineffectiveness, in Rev. St. 1911, art. 7897, providing any contract violative of anti-trust statutes shall be absolutely void, term was used to describe usual legal effect of an unlawful contract, which is that when executed resulting titles will not be disturbed. (Per Boyce, J.)
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Void.]
    On Motion for Rehearing.
    7. Pleading <®=>34(3) — Demurrer—Presumption.
    Every reasonable presumption in favor of sufficiency of petition should be indulged on general demurrer.
    8. Insurance <©=>676 — “Reinsurance.”
    The common acceptation of the term “reinsurance” is to assume the obligation imposed by a policy of insurance.
    Hall, J., dissenting.
    [Ed. Note. — For other definitions, see Words and Phrases, First and Second Series, Reinsurance.]
    On Second Motion for Rehearing.
    9. Judges <©=>45 — Court oe Civil Appeals— Disqualification of Chief Justice — Interest.
    In insurance company’s suit on premium note assigned to it by another insurance company, Chief Justice of Court of Civil Appeals, holder of policies in assignor company, and whose son-in-law was its vice president and acting manager, and had discussed the transaction in his presence, was disqualified to sit in the case.
    Appeal from Potter County Court; T. W. McBride, Judge.
    Suit by the California State Life Insurance Company against J. D. Kring. From judgment dismissing the cause, plaintiff -appeals.
    Reversed and remanded.
    Madden, Trulove, Ryburo & Pipkin and T. H. Cody, all of Amarillo, for appellant.
    Kimbrough, Underwood & Jackson, of Amarillo, for appellee.
   ROLLINS,. Special Chief Justice.

The appellant filed its suit in the county court of Potter county, Tex., to recover on a promissory note,, executed by the appellee and payable to the Amarillo National Life Insurance Company. The appellant alleged that it was a corporation, incorporated under the laws of the state.of California, with a permit to do business in Texas, and that the Amarillo National Life Insurance Company is a corporation, incorporated under the laws of the state of Texas. On the 19th day of October, 1913, the appellee executed his promissory note, payable to the Amarillo National Life Insurance Company, for the amount of the premium due on the policy issued by the Angarillo National Life Insurance Company. The appellant alleges that—

After the execution of the note sued on, “the California Life Insurance Company, took over all of the assets and liabilities of said the Amarillo National Life Insurance Company, and became the legal owner and holder of the note above described, having assumed the obligations imposed by all policies of insurance issued by said the Amarillo National Life Insurance Company, including the defendant’s policy, and having purchased and become the legal owner and holder of all premium notes due on such-policy, and having the right by reason of such purchase to collect premiums due on such policies of insurance, including the defendant’s policy of insurance and the premium thereon due as here sued for, plaintiff becoming the owner of said note above set forth by reason of said purchase on or about the 18th day of March, A. D. 1916.”

The appellant, by supplemental petition, alleged that—

“About the 18th day of March, A. D. 1916, the plaintiff, by purchase, took over the Amarillo National Life Insurance Company’s life insurance business with all its assets and liabilities pertaining to such insurance business, assuming liability on its existing policies of insurance and having transferred to it all notes and choses in action of said Texas corporation pertaining to said insurance business, among which was the note of the defendant herein sued upon. That such contract of sale of said Amarillo National Life Insurance Company to the California State Life Insurance Company was in all things according to law, and such contract was approved by the department of insurance and banking of the state of Texas.”

The trial court sustained a general demurrer, and, the appellant refusing to amend, the •cause was dismissed, from which judgment the appellant has appealed to this court

Article 7797, Rev. St. 1911, provides as follows:

“A monopoly is a combination or consolidation of two or more corporations when effected in either of the following methods: (1) * * * (2) Where any corporation acquires the shares •or certificates of stock or bonds, franchise or other rights, or the physical properties, or any part thereof, of any other corporation or corporations, for the purpose of preventing or lessening, or where the effect of such acquisition tends to affect or lessen competition, whether such acquisition is accomplished di-reetly or through the instrumentality of trustees, or otherwise.”

Article 7807, Rev. St. 1911, provides as follows:

“Any contract or agreement in violation of the provision of this chapter shall be absolutely void and not enforceable either in law or equity.”

Article 4737, Rev. St. 1911, provides as follows:

“Any life insurance company, organized under the laws of this state, may reinsure in any insurance company authorized to transact business in this state, any risk or part of a risk which it may assume; provided, that no such company shall have the power to so reinsure its entire outstanding business until the contract therefor shall be submitted to the commissioner of insurance and banking, and be by him approved, as protecting fully the interest of all the policy holders.”

The allegation that the appellant “took over all the assets and liabilities of the Amarillo National Life Insurance Company” does not necessarily mean that the transaction was not authorized by the provisions of article 4737 of the Revised 'Statutes. -All of the assets and liabilities of the Amarillo National Life Insurance Company may have been represented by the outstanding policies of insurance and the premium notes unpaid. If this was true, the transaction was not,repugnant to the provisions of the anti-trust statutes above quoted.

The allegations of the appellant are susceptible of the construction that the transaction pleaded had been fully executed by the voluntary act of the parties. If the transaction was an executed one, the authorities seem to hold the title to the note in question passed to the appellant. The rule is stated in 13 C. J. p. 511„§ 467:

“That property has been acquired in violation of some law does not rob it of its character as property nor prevent it from becoming the subject of legitimate contract which may be enforced in courts of law.”

In the case of Wegner v. Biering, 65 Tex. 511, the rule is stated that—

“When the contract has been executed without the aid of courts by the voluntary acts of the parties, the profit or estate realized is not contaminated.”

We are of the opinion that the pleadings of the appellant are not subject to general demurrer, and therefore reverse and remand the cause that the matters in controversy may be tried out.

HUFF, O. J., disqualified.

HALL, J., dissents.

BOYCE, J.

(concurring).

The statute under consideration makes illegal the purchase of the property of one corporation by another only when the acquisition is “for the purpose of preventing or lessening or where the effect of such acquisition tends to affect or lessen competition.” The first question, then, Is 'whether the allegations of plaintiff’s petition show that such was the purpose or effect of the transaction set out therein. The presumption of innocence would apply, and, unless the facts stated clearly show that the transaction was unlawful, it will he presumed that the contract did not violate the law. Williams v. Talbot, 27 Tex. 159; Tucker v. Streetman, 38 Tex. 71; Yates v. Houston, 3 Tex. 433. The extent to which the allegations of this petition go, in addition to the allegation of the fact of the sale, is that,' at the time of the purchase of the assets of the Amarillo Company by the California Company, the Amarillo Company “had full charter powers of conducting the business of a life insurance company, in soliciting insurance,” etc., and that the California Company was at that time engaged in such business in Texas. The petition alleged that, at the time of the execution of the note in 1912, the Amarillo Company was engaged in the life insurance business in Texas, and the sale of the note was made in March, 1910, so that there is no direct allegation that the Amarillo Company was actually engaged in business in 1916. The presumption of a continuation of a status is weaker than the presumption of innocence. Authorities above cited. Even if the petition sufficiently shows that the Amarillo Company was engaged in business at the time of the sale, there is no showing that but for the sale it would have continued in business and been a competitor with' the California Company. It is possible that the Amarillo Company was already in process of liquidation, or that its stockholders had already, and independent of any sale to the California Company, decided to discontinue business. The company did not have to remain in business during the full term of its charter; in fact, its permit to continue in business only extends and is granted from year to year upon, a satisfactory showing of its business to the commissioner of insurance. Rev. St. art. 4730. The Amarillo Company, with the consent of the insurance commissioner, might reinsure all its risks. Rev. St. art. 4737. And so far as we are informed by the petition, the stockholders of the Amarillo Company may have, prior to the sale to the California Company, decided to do this and retire from further business. The approval by the commissioner of insurance of this contract of sale suggests the probability of tthis condition. If this was the case, the purpose and effect of the sale was not to prevent or lessen competition. Other circumstances might possibly be stated from which the same conclusion might be drawn. It was not necessary that the pleader state in. detail the circumstances of the transfer of the note, though it was not indorsed. Rev. St. art. 582; Lewis v. Bank, 204 S. W. 889; O’Connell v. Rugely, 48 Tex. Civ. App. 456, 107 S. W. 152; Word v. Elwood, 90 Tex. 130, 37 S. W. 414; Ford v. Johnston, 184 S. W. 303. Since some of the details were stated, I take it that, if they show that the plaintiff had no title to the note, the demurrer was properly sustained. However, all the facts stated may be true, and yet, under certain supposable circumstances just referred to, the contract would not have been unlawful. I think the presumption in favor of the legality of the contract should prevail.

But I am of the opinion that the demurrer was improperly sustained, even if the allegations of the petition had brought the contract of sale within the terms of Rev. St. art. 7797. Of course, under such circumstances, if the suit were brought to enforce the contract of sale, its invalidity would be a sufficient defense; but the contract itself has been consummated and furnishes only the basis of plaintiff’s title to the note. Let us first consider this phase of the question, independent of any effect that the provision of the statute, which makes contracts in violation of the act “absolutely void and not enforceable,” might have on it. The authorities, I think, amply sustain the proposition that where a contract, in violation of law or against public policy, has been fully executed, the courts will recognize and .protect the rights and titles resulting from the execution. of the contract. As between the parties themselves, when an illegal contract has been executed in whole or in part, the maxim, “Exturpi causa non oritur actio, in pari delic-to melior est conditio possidentis” (Pomeroy, Equity Jurisprudence [2d Ed.] § 939), applies. The condition of the possessor referred to in the maxim “is clearly the condition of the parties with respect to their property rights created by or resulting from the contract. If the contract is still executory, the promisor is left undisturbed in possession of the money or other property which he agreed to pay or transfer. If the contract has been executed, the promisee is left undisturbed in the possession of the money or other property which has been conveyed to him.” Pom-eroy, § 939. If in such executed contracts the other party to the unlawful contract cannot question the title to property conveyed in execution thereof, why should some third person who has no title to the'property himself, and whose only interest in the matter is in the question of title, be permitted to do so? The following Texas authorities support the proposition first above announced:

In Wegner v. Biering, 65 Tex. 511, the court says:

“When the contract has been executed without the aid of the courts by the voluntary acts of the parties, the profit of estate realized is not contaminated.”

See, also, quotations to same effect from the Planters’ Bank Case (16 Wall. 483, 21 L. Ed. 473), and Sharpe v. Taylor, quoted with approval in De Leon v. Trevino, 49 Tex. 93, 94, 30 Am. Rep. 101.

In Patty-Joiner Co. v. City Bank, 15 Tex. Civ. App. 475, 41 S. W. 177, writ of error denied, the court approves the following proposition of law:

“The distinction between enforcing illegal contracts or contracts void as against public policy, and asserting title to property or money which has arisen from them, is clearly and distinctly drawn.”

In the Northern Securities Cases (Harriman v. Northern Securities Co.) 197 U. S. 297, 25 Sup. Ct. 493, 49 L. Ed. 763, and (Northern Securities Co. v. United States) 193 U. S. 197, 24 Sup. Ct. 436, 48 L. Ed. 679, where stocks in the competing lines of railway referred to in the opinion had been conveyed to said Northern. Securities corporation, and the transaction was held illegal because a trust was thereby created in violation of the federal Anti-Trust Act, which declared every contract and combination falling within its provisions to be illegal, it was recognized on this principle that the title to the stocks conveyed was vested in the Securities Company, and the parties conveying the stock would not be permitted to recover it. The transaction was held illegal, but the assets of the corporation were ordered distributed in the same manner as if the acquisition of the stocks had been legal. In short, the title acquired in the illegal transaction was recognized. The conclusion of the court is summed up in this language:

“In fine, the title to these stocks having intentionally been passed, the former owners or part of them cannot reclaim the specific shares and must be content with their ratable proportion of the corporate assets.”

The cause of action in this case is on the note, which has no connection with the illegal contract. The title to this note is either in the Amarillo Company or the California Company. If, as between these two, it is in the California Company, the defendant cannot question such result unless this conclusion is affected by the terms of the statute which expressly make such contracts “absolutely void and not enforceable.”

I do not deny that in one sense, and perhaps in the strictest and most accurate conception thereof, the word “void” .involves the idea of utter ineffectiveness in all situations and for all purposes, leaving the effect of the void transaction the same as if it had not taken place. Nor that the use of the word “absolutely” in connection does not lend strength to the contention that it was in this sense that the word was used in this statute. But the word “void” is very frequently used in legal phraseology to describe the effect of a stated set of circumstances in a ■sense that does not comprehend this utter nullity. In fact, the authorities assort that it is “seldom, unless in a very clear case, to be regarded as implying a complete nullity; but it is, in a legal sense, subject to large-qualifications, in. view of all the circumstances calling for its application and the rights and interests to be affected in a given case.” Wiener v. Zweib, 105 Tex. 262, 141 S. W. 777, 147 S. W. 867; Bouvier’s Law Dictionary; Words and Phrases, First and Second Series.. It has been held in a number of cases that the term “utterly void,” as used in legislative enactments under consideration, did not imply utter futility as between all parties under all circumstances. Burgett v. Burgett, 1 Ohio, 469, 13 Am. Dec. 634; Anderson v. Roberts, 18 Johns. (N. Y.) 526, 9 Am. Dec. 235; Fox v. Willis, 1 Mich. 325. Contracts in violation of law and those against public policy are universally described by legal authorities as being “void,” “wholly void,” etc., and this is true whether the statute prohibiting an act expressly so declares or not. 13 C. J. 351; 9 Cyc. p. 465. Such contracts are more than voidable; they cannot be ratified, for the contract of ratification would be subject to the same vice; and whenever they are attempted to be enforced the court will refuse its aid to that purpose; but as we have already seen, when such contracts have been executed, the titles resulting will not be disturbed, though the contracts have been denominated as being void. So that, even if the word “void” be not strictly accurate as describing the effect of such contracts, it has by long usage come to be recognized as proper in this connection, and its meaning in such connection is well understood. When therefore the Legislature declared that contracts under, consideration in violation of the terms of the statutes were “absolutely void and unenforceable,” I think it is a fair conclusion to say that the expression was simply used in the sense that it was customary for legal authorities to use such terms in connection with the description of the effect of an unlawful contract. If we were to apply the strictest sense of the term here, no rights or titles to real or personal property, even of innocent third persons, could come through such an executed contract and be upheld by the courts. There could be no security in property rights or titles where the chain of title may have passed from, one corporation to another. I cannot believe that the Legislature intended that the enactment should have s,uch a far-reaching and disturbing effect.

While the suit here is by one of the parties to the alleged illegal contract, the suit is not to enforce that contract; it has been executed by the parties themselves. The title to the note alone is involved, and that has been by the acts of the parties vested in the California Company.

HALE, J.

(dissenting). I regret my inability to agree with the majority in the disposition made of this appeal. The primary question presented is whether or not the court erred in sustaining the general demurrer to the plaintiff’s cause of action, as set out in its original and first supplemental petitions. Appellant, plaintiff in the court below, instituted a suit to recover of appellee upon, a note for $485.90, executed to the Amarillo National Life Insurance Company. The note is as follows:

“485.90. Sandia, Tex., October 19, 1913.
“On or before the 19th day of July, 1914, without grace, I promise to pay to the order of the Amarillo National Life Insurance Company, at its office in Amarillo, Texas, the sum of four hundred eighty-five and 00/ioo dollars, with interest thereon from date until paid, at the rate of five per centum per annum. This note is given on account of the premium due October 19, 1913, on said company’s policy No. 3368, insuring my life and if it shall not be paid in full at its maturity all insurance under said policy shall cease and determine ipso facto and immediately, save as therein otherwise provided. In such event this note shall cease to be binding except for the amount of the premium unpaid and unearned at the date of default, together with interest thereon; but for that amount and interest it shall remain a valid obligation. [Signed] J. D. Kring.”

Plaintiff’s original petition alleges:

That it is a corporation, having its principal office and place of business in Sacramento, Cal., but has a permit to do business in this state and is lawfully doing business in Texas, maintaining an office and place of business in Amarillo, Potter county, Tex. “That heretofore, to wit, on or about the 19th day of October, 1912, the Amarillo National Life Insurance Company, a corporation, having its principal office and place of business at Amarillo, Potter county, Tex., duly organized and chartered and doing business under the laws of the state of Texas, was in the business of insuring the lives of individuals in said state, receiving premiums therefor on the policies of insurance so issued by it.”

The pleading then sets out the issuance of a policy to appellee, giving the amount, and alleges the execution of a premium note, in the sum of $485.90; that on the 19th day of October, 1913, the second annual premium being due, the note above set out was executed and delivered to the Amarillo National Life Insurance Company, and continues as follows:

“That thereafter the plaintiff herein, the California State Life Insurance Company, took over the assets and liabilities of the said the Amarillo National Life Insurance Company, and became the legal own^r and holder of the note above described, having assumed the obligations imposed by all policies of insurance issued by the Amarillo National Life Insurance Company,” etc.

The petition further alleges that plaintiff is the owner of the note sued on by reason of ' the fact that it purchased the same from the Amarillo National Life Insurance Company. By appropriate allegations it is shown that $364.42 of said note, with interest thereon., from October 19, 1913, was earned premium at the time of the filing of the suit; that said amount is long since past due, and defendant, though often requested, has wholly failed to pay the same. By supplemental petition appellant alleges, in part, as follows:

“Eor special answer, if required, to the allegations in said first amended original answer, plaintiff admits that the Amarillo National Life Insurance Company was a corporation, duly organized and existing by virtue of the laws of the state of Texas, wih its principal office and place of business in Potter county, Tex., and that at the times complained of had full charter powers of conducting the business of a life insurance company, in soliciting insurance on the lives of individuals, and of collecting premiums on such of its policies as were issued; that the California State Life Insurance Company is a foreign corporation, organized and existing under and by virtue of the laws of the state of California, with a permit to do business in Texas, and that it had such permit to do business in Texas prior to the sale' of the Amarillo National Life Insurance Company to it, but plaintiff alleges that, at the time of such purchase of said Amarillo National Life Insurance Company by it, it had few, if any, policies of insurance in force in the state of Texas, having only one agent in the state, and that such policies as had been issued by it and as were in force, and effect had virtually all expired at the time of the purchase of said Texas corporation; that about the 18th day of March, A. D. 1916, the plaintiff, by purchase, took over the Amarillo National Life Insurance Company’s life insurance business, with all its assets and liabilities pertaining to such insurance business, assuming liability on its existing policies of insurance and having transferred to it all notes and choses in action of said Texas corporation pertaining to said insurance business, among which was the note of the defendant herein sued upon; that such contract of sale of the said the Amarillo National Life Insurance Company was in all things according to law, and such contract was approved by the department of insurance and banking of the state of Texas; and plaintiff alleges the fact to be that the policy of insurance as issued to defendant was in all things according to the charter rights and powers of said the Amarillo National Life Insurance Company, in accordance with its life insurance business,” etc.

The note above set out was payable to the order of the Amarillo National Life Insurance Company, and bore no indorsements whatever.

Article 7797, Vernon’s Sayles’ Civil Statutes, defining a “monopoly,” is:

“A monopoly is a combination or consolidation of two or more corporations when effected in either of the following methods: (1) * * * (2) Where any corporation acquires the shares or certificates of stock or bonds, franchise or other rights, or the physical properties, or any part thereof, of any other corporation or cor-^orations, for the purpose of preventing or lessening, or where the effect of such acquisition tends to affect or lessen competition, whether such acquisition is accomplished directly or through the instrumentality of trustees or otherwise.”

Article 7807, Id., provides:

“Any contract or agreement in violation of the provisions of this chapter shall be absolutely void and not enforceable either in law or equity.”

The allegations in appellant’s pleadings, as I understand them, leave no room for doubt as to the nature of the transaction through which appellant acquired the note. I am unable to find the faintest hint that it was a reinsurance undertaking. The allegations are:

“That thereafter the plaintiff herein, the California State Life Insurance Company, took over all the assets and liabilities of the said the Amarillo National Life Insurance Company; * * * that plaintiff is the owner of the note sued on by reason of the fact that it purchased the same from the Amarillo National Life Insurance Company; * * * that it had such permit to do business in Texas prior to the sale of the Amarillo National Life Insurance Company to it, but plaintiff alleges that at the time of such purchases of said Amarillo National Life Insurance Company by it,” etc.

There is this further specific allegation:

“That about the 18th day of March, A. D. 1916, plaintiff, by purchase, took over the Amarillo National Life Insurance Company’s life insurance business, with all its assets and liabilities pertaining to such insurance business,” etc.

These statements, in. my opinion, show simply a sale upon the one part and a purchase upon the other, and I am unable to find the word reinsurance or any synonym of it anywhere in the pleading. If I am correct in this construction, then article 7797, supra, has been violated, and it requires no argument to show that the effect of such a sale tends to affect competition. The unavoidable conclusion is that, when the Amarillo National Life Insurance Company sold all of its life insurance business, it, by virtue of that fact, was at an. end. Appellant having acquired the note in virtue of a contract clearly within and inhibited by the statute, it is, in the language of the statute, “absolutely vcttd and not enforceable, either in law or equity.” Article 7807, supra; Langford et al. v. Powell et al., 196 S. W. 662. Having sued as the legal owner and holder of the note under an assignment from another corporation, in violation of the statute appellant is not entitled to recover in the capacity of owner, and this defect may be raised by general demurrer. Fuqua v. Pabst Brewing Co., 90 Tex. 298, 38 S. W. 750, 35 L. R. A. 241. The note being payable to the order of the Amarillo National Life Insurance Company, and bearing no indorsement of the payee, and being' otherwise nonnegotiable (by reason of its provision as to unearned premium), before appellant can recover it must both allege and prove the assignment to show its ownership. Ross v. Smith, 19 Tex. 171, 70 Am. Dec. 327; Merrill v. Smith, 22 Tex. 53; Ball v. Hill, 38 Tex. 241. In order to prove ownership, appellant must, of course, show the illegal transaction set out in its pleadings and through which it acquired title to the note. The test whether a causé of action, connected with an illegal transaction, can be enforced at law, is whether the plaintiff requires any aid from the illegal transaction, to maintain his case. Read v. Smith, 60 Tex. 382; Wiggins v. Bisso, 92 Tex. 219, 47 S. W. 637, 71 Am. St. Rep. 837; Oliphant v. Markham, 79 Tex. 543, 15 S. W. 569, 23 Am. St. Rep. 363. It is true that the appellee in his relation to the contract of sale, by which appellant purchased the Amarillo National Life Insurance Company, is a third party.

“The defense of illegality, although open to the parties and those claiming under them, cannot as a rule be invoked by third persons. This rule is, of cours^, subject to an exception, where it is attempted to assert rights based on a contract where the illegality of the contract appears from the plaintiff’s own showing or where the interests of the person asserting the invalidity are affected.” 13 C. J. 508, § 458.

Since the statute expressly declares contracts of the character shown in the plaintiff’s pleadings to be absolutely void, and since in order to recover as the assignee of the note appellant must assert ownership under the contract, the writer thinks the case comes within that class which may be attacked by third parties. Cumberland Tel. <& Tel. Co. v. City of Evansville (C. C.) 127 Fed. 196. The absolute ownership of the note being still in the Amarillo 'National Life Insurance Company, appellee could insist that no one but the owner be permitted to collect it from him. Until appellant shows its legal right to recover by its pleading,' a general demurrer should be sustained. 8 C. J. 885, § 1157; Colbertson v. Beeson, 30 Tex. 76; Drinkall v. Movius State Bank, 11 N. D. 10, 88 N. W. 724, 57 L. R. A. 341, 95 Am. St. Rep. 693.

Special Chief Justice ROLLINS quotes from 13 C. J. 511, § 467, as follows:

“That property has been acquired in violation of some law does not rob it of its character as such, nor prevent its becoming the subject of legitimate contracts which may be enforced in courts of law.”

The language quoted is a part of the syllabus of Wayman Investment Co. v. Wessinger & Wagner, 13 Cal. App. 108, 108 Pac. 1023. That is a case where the lessee of a building which had been erected in violation of an ordinance establishing fire limits, and making the act of its erection punishable by fine, sought to have his lease contract declared void and escape the payment of rent because the consideration of the contract was illegal. There was a judgment for the lessor in the trial court, and the California Court of Appeals, in affirming the judgment, said:

“Although there may be some illegal features indirectly connected with a transaction involved in a suit, yet the plaintiff may recover if his cause of action is otherwise legitimate, and he can make out his case without calling to his aid the illegal agreement. The test of whether the demand can be enforced at law is whether the plaintiff requires the aid of the illegal contract to establish his case.”

That case is authority in this only in the announcement of the above rule. Since it is not necessary for the lessor, in order to recover the rent, to prove any fact or circumstance with regard to the erection of his building, as a whole the case has no application here. The writer has no quarrel with the rule of law quoted by Special Chief Justice ROBBINS. Although the lessor in that case had, in violation of the fire ordinance, erected a wooden or prohibited building on his lot, it was nevertheless his property as against the world, and there was no statute declaring, as in the instant case, that the contract was “absolutely void and not enforceable, either in law or equity.” Nor is the rule quoted from the case of Wegner Bros. v. Biering, 65 Tex. 506, by both of my Brethren, to the effect that, “when the contract has been executed without the aid of the courts by the voluntary act of the parties, the profit or the estate realized is not contaminated,” applicable. Admitting that the note itself upon which' the suit is based herein is not contaminated, as will be hereinafter discussed, appellant cannot recover upon it because he did not acquire it legally, and, as shown by his pleadings, requires the aid of such illegal contract to establish his case. My contention is that when a statute denounces a contract as absolutely void, declares it to be unenforceable in the courts, and makes the entering into such a contract a crime providing a penalty, it cannot become an executed contract as a matter of law; and when, in addition to all of this, it falls clearly within that class of contracts held illegal as against public policy, it is void, and not merely voidable, as asserted by Associate Justice BOYCE. Reed v. Brewer, 90 Tex. 144, 37 S. W. 418.

“Where a statute expressly declares that certain kinds of contracts shall be void, there is then no doubt of the legislative intention and an agreement of the kind voided by statute is unlawful. The same is true where the contract is in violation of a statute, although not therein expressly declared to be void. It is immaterial whether the thing forbidden is malum in se or merely malum prohibitum-” 13 C. J. 420, § 351.

The presumption of innocence, which Associate Justice BOYOE thinks should apply, in my opinion does not obtain here, and the holdings to that effect in the cases cited by him were under altogether different circumstances. In my opinion the presumption of innocence should not obtain when the accused has confessed his crime in writing; nor should the courts, in the face of such confession, endeavor to draw from it inferences of fact tending to show a possibility of innocence as against an unequivocal confession, setting up the details of his offense, such as we find in the appellant’s pleadings. A culprit should not be permitted to urge a general plea of not guilty and call upon the courts to imagine the existence of facts not set out in his statement and contrary thereto which, if true, would possibly acquit him; nor should he be permitted to retain and enjoy the fruits of his contract illegally obtained, simply because he was not caught in the act and was not challenged until he had the goods safely in hand and was in a position where he could claim that the contract was an executed one. This would be placing a premium on alertness and agility in lawbreaking.

As between the two insurance companies, the contract may in one sense be considered as executed, but judicial aid should not be extended either party in the enforcement of any alleged rights acquired under it, especially when the plaintiff must depend upon the illegal contract as one necessary ground of recovery. Both the statute and consideration of public policy demand this of the courts. McMullen v. Hoffman, 174 U. S. 639, 19 Sup. Ct. 839, 43 E. Ed. 1117; Gray v. Oxnard Bros. Co., 59 Hun, 387, 13 N. Y. Supp. 86. The tendency under the contract between the insurance companies would unquestionably be toward the creation of a monopoly and combine. A recovery upon the note is one step toward the consummation of this illegal design. Denial of relief in the case will discourage the formation of such contracts and tend strongly toward reducing the number of siich' transactions to a minimum.” Brent v. Gay, 149 Ky. 615, 149 S. W. 915, 41 L. R. A. (N. S.) 1034; Continental Wall Paper Co. v. Voight & Sons, 148 Fed. 939, 78 C. C. A. 567, 19 L. R. A. (N. S.) 143; Id., 212 U. S. 227, 29 Sup. Ct. 280, 53 L. Ed. 486. In my opinion, the Northern Securities Cases, 197 U. S. 297, 25 Sup. Ct. 493, 49 L. Ed. 763, and 193 U. S. 197, 24 Sup. Ct. 436, 48 L. Ed. 679, relied upon and cited by Judge BOYCE, is not authority here. The general principle that in suits upon fraudulent contracts the court will grant relief to neither party, but will leave them in the condition in which it finds them, evidently controlled the disposition of that case, and the effect of the opinion, denying the plaintiff the right to recover the certificates of stock, was in line with that principle. By reason of the fact that the Texas anti-trust statute declares a contract under which appellant acquired the note to be absolutely void, appellant is not the owner in any sense of the note. The statute is an absolute bar to such ownership, and, since the facts set up in its pleadings show that it is not the 'owner, the court did not err in sustaining the demurrer. The weight of authority is that, if money or property other than choses in action is the consideration for such an illegal contract, such property cannot be recovered if the contract is fully executed, because the court will leave the parties in the position in which it finds them. Reed v. Brewer, supra; Hall v. Edwards, 194 S. W. 674, 678; Beer v. Landman, 88 Tex. 450, 31 S. W. 805. To permit one party to an illegal contract to recover upon a note executed by a third party, and the possession of which passed by the contract, is simply judicial recognition of the contract and enforcing rights acquired under it. The position of the parties should not be changed. I admit that, if the note was indorsed by the Amarillo National Life Insurance Company, possession by appellant would be prima facie evidence of ownership and it would not “require the aid of the illegal contract to establish its case.” I also admit, as stated by Judge BOYCE, that it was not necessary for the pleader to state in detail the circumstances of the transfer of the note, but in this case the circumstances are stated. Being merely the assignee of a nonnegotiable instrument it would have been, sufficient if appellant had alleged that it was such assignee, in which event the demurrer would not lie, but when the pleadings set out in detail the circumstances of the transfer, and it appeared therefrom that the note was acquired illegally, the demurrer was properly sustained.

Entertaining the views above expressed, I respectfully dissent from the majority holding and insist that the judgment should be affirmed.

On Motion for Rehearing.

ROLLINS, Special Chief Justice.

The appellee insists that the majority of the court is in error in holding the appellant’s petition sufficient as against a general demurrer. In writing the original opinion we assumed that all parties would agree that every reasonable presumption in favor of the sufficiency of the pleading should be indulged. Therefore no discussion of that proposition was had. This court, in Roberts v. Anthony, 185 S. W. 423, speaking through Judge Hall, held that “every reasonable in-tendment must be presumed in favor of the sufficiency” of the pleadings as against a general demurrer. That is the holding of an unbroken line of decisions.

In the dissenting opinion, it is stated: “I am unable to find the word reinsurance, or any synonym of it, in the pleading.” The common acceptation of the term “reinsurance” is to assume the obligation imposed by a policy of insurance. The pleader alleged that the California Company assumed the obligation imposed by all policies of insurance issued by the Amarillo Company. This court has held that the presumption of legality must be indulged. Jackson v. Greenville Compress Co., 202 S. W. 324. Appellant alleged that the commissioner of insurance and banking had approved the contract. There was no occasion to present the contract to the commissioner for approval, except it be a contract for the reinsurance of all of the business of the Amarillo Company. The only legal way the insurance business of the Amarillo Company could be taken over by the California Company was by a reinsurance contract. The conclusion, it seems, naturally follows that the contract alleged was one for the reinsurance of the business of the Amarillo Company. At least, it is not an unreasonable inference. In any event, the rights of litigants ought not to be made depend upon the happy or precise use of words either in the expression or suppression of facts.

. Counsel for appellee contend that it was the duty of the appellant to plead any special circumstances which relieved the transaction of illegality, and that it is not proper for the court to conjecture that such circumstances exist. The court does not undertake such task. Appellee urged a general demurrer. The transaction must be presumed legal unless the contrary conclusively appears. Every reasonable intendment in favor of the sufficiency of the petition must be indulged. A reinsurance contract would have been legal. It does not conclusively appear that the transaction alleged was not a reinsurance contract. It necessarily follows that this court should indulge the presumption of the legality of the transaction and the sufficiency of the pleading, rather than to conjecture that the “appellant had made the best statement of its cause of action that it could make, ,and that there were no special circumstances which it could truthfully plead that would relieve the transaction and contract between appellant and the Amarillo National Life Insurance Company of its apparent illegality.”

The Supreme Court of this state has held that a county commissioner’s court and a broker contracting with it are presumed to know the law and intended to obey it. Foard County, v. Sandifer, 151 S. W. 523. It has also been held that the sale of property of a public service corporation was made under the statutes authorizing such sale unless the contrary affirmatively appears. Gulf, etc., Co. v. Lasater, 193 S. W. 773. It does not therefore seem an unreasonable stretch of the rule to hold that the commissioner of insurance and banking did not act in a matter in which he was not authorized to act or that, in acting, he obeyed the law.

In thé opinion of the writer the motion is without merit and is in all things overruled.

On Second Motion for Rehearing.

HALL, J.

In its motion for rehearing appellant insists that Chief Justice HUFF, of. this court, was not disqualified, and that Special Justice ROLLINS had no authority to act. The affidavit of Chief Justice HUFF filed herein, shows that he is the holder of policies of insurance on his life, issued by the Amarillo National Life Insurance Company, to the amount of $5,000, payable to his wife upon his death; that they provide for payment, under certain circumstances, in case of sickness or injury during his life; that the policies are now in force. He further shows that his son-in-law was vice president and acting manager of the Amarillo National Life Insurance Company at the time the transfer by that company to appellant was executed, and that, from having heard his son-in-law discuss the matter while visiting his home, he learned something of the transaction. The affidavit further states that he did not consult with or in any way advise his son-in-law, or any one connected with the matter, concerning it, and, having suggested these things to the Associate Justices of the court, we agreed that he was disqualified and should not sit in the case. Boynton Lumber Co. v. Houston Oil Co., 189 &. W. 749, 760.

The motion is in all things overruled.
      <©=>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

      ©=»For other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: MOURSUND, J.

text:
    RAMIREZ v. MARTINEZ.
    (No. 6145.)
    (Court of Civil Appeals of Texas. San Antonio.
    Jan. 15, 1919.)
    1. Judgment <@=>143(16) — Setting Aside DEFAULT — DILIGENCE.
    Plaintiff, who'had not resided in the county for two years, and was unable to speak, read, or write English, held to have been sufficiently diligent to justify setting aside defendant’s judgment against him taken by default, Legislature having changed time of holding court, etc.
    2. Appeal and Erroe <@=742(1) — Assignment of Error — Statement by Reference — Absence of Testimony.
    In suit to set aside default judgment, an assignment, whose proposition is that plaintiff’s failure to appear and answer was not chargeable to defendant’s fraud, referring for statement to that of another assignment which contains none of the testimony on the issue of diligence, etc., must be overruled.
    Appeal from District Court, Webb County t J. F. Mullally, Judge. N
    Suit by Jesus M. G. Martinez against Ilde-fonso Ramirez. From judgment for plaintiff, defendant appeals.
    Affirmed.
    John L. Dannelley, of Laredo, for appellant.
    Greer & Hamilton, of Laredo, for appellee.
   MOURSUND, J.

This suit was filed in the district court of Zapata county, Tex., on November 20, 1917, by appellee, to set aside a judgment -of the said district court rendered during.the October term thereof in cause No. Ill, Ildefonso Ramirez v. Jesus G. Gonzales et al. By agreement the case was transferred to Webb county, and the trial thereof resulted, in a judgment for appellee.

The petition fully disclosed that appellee was not liable on the cause of action alleged against him, and also showed that appellant knew of such fact, and obtained a judgment by false testimony on his part. No question is raised on this appeal with regard to the sufficiency of the pleadings or prpof on the issue whether appellee had a good defense.

Under an assignment complaining of the overruling of the general demjirrer it is contended that the petition fails to show sufficient diligence on the part of appellee to justify the court in setting aside the judgment. Appellee alleged that after he had attended two terms of court, the Legislature changed the time of holding the court from. November, 1917, to October, 1917, and that appellee, who had not resided in Zapata county for two years and was unable to speak, read, or write the English language, was ignorant of such change, and therefore was not in attendance at the time of the trial, and did not ascertain that the case had been tried until after the expiration of such term of court. He further alleged that there was no session of the court at the time named in the citation, and that when he again appeared at the next term he was told by the officers of the court that there would be no business transacted, and as a matter of fact there was no civil business transacted at said term.

We conclude that the court did not err in overruling the demurrer. Dowell v. Winters, 20 Tex. 796; Queiroli v. Whitesides, 206 S. W. 122,, and eases therein cited; McMurray v. McMurray, 67 Tex. 665, 4 S. W. 357.

It is contended in the second assignment that the facts do not support the judgment, and the proposition is to the effect that, as the failure of appellee to appear and answer was not chargeable to fraud or misrepresentation on the part of appellant, the judgment should be reversed. For statement, reference is made to that under the first assignment, which, however, does not contain any of the testimony adduced on the issue of diligence, nor state that appellee’s testimony was not in accordance with the allegations contained in his petition. The assignment must be overruled.

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