author: GREENHILL, Justice.

text:
    TEX-WIS COMPANY et al., Petitioners, v. Margaret JOHNSON et al., Respondents.

    No. B-5503.
    Supreme Court of Texas.
    March 24, 1976.
    Rehearing Denied April 28, 1976.

      Cox, Pakenham & Roady, Joe G. Roady, Houston, for petitioners.

      Tillman, Pribilski & Hunt, James R. Hunt, Houston, Haley, Fulbright, Winni-ford, Bice & Davis, Sherwin A. Winniford, Waco, Mac Leon Bennett, Normangee, for respondents.

        Editor’s Note: The opinion of the Court of Criminal Appeals in Smith v. State, published in the advance sheets at this citation (534 S.W.2d 895), was withdrawn from the bound volume pending determination of a petition for rehearing.

   GREENHILL, Justice.

This is a suit in trespass to try title.

Plaintiffs Margaret Johnson and others brought suit against Tex-Wis Company and other persons claiming under Tex-Wis for title to, and possession of, a 53-acre tract of land and an adjoining 96-acre tract. In accordance with the jury’s findings, the trial court rendered judgment in plaintiffs’ favor with respect to both tracts. The Court of Civil Appeals affirmed. 525 S.W.2d 232. We affirm.

The plaintiffs are the heirs of King Alexander. Prior to 1892, King Alexander took possession of the 150 acres of land which constitute the two tracts in controversy.

As a result of litigation with the record titleholder of the 150 acres, Alexander obtained a judgment dated March 16, 1911, which awarded him 50 acres to be “carved out” from the 150 acres “in order to cover the house and other improvements thereon placed by King Alexander and the same is to be selected and run out by said King Alexander so as to include the aforesaid improvements, or as much of same as can conveniently in a square (sic).”

A set of field notes dated September 15, 1915, purported to locate “50 acres out of the K. Alexander 151V2 acre survey.” In 1918, Alexander purchased the other 96 acres which make up the 150 acres. In consideration, he executed a note secured by a deed of trust. In 1921, as a result of Alexander’s default on the note, the 96 acres were sold under the deed of trust to the predecessor in title of Tex-Wis. In spite of this foreclosure, Alexander continued to occupy the entire 150 acres until his death in 1934, at which time some other members of his family continued in possession.

In 1948, Tex-Wis obtained from the record owner a quitclaim deed to some 650 acres. This deed covered the 96-acre tract, but it expressly excepted “an undivided interest of 50 acres which was awarded to King Alexander by decree of court.”

The jury found that the plaintiffs, or those under whom they claim, had held exclusive, peaceable and adverse possession of both the 96-acre tract and the 53-acre tract for a period in excess of ten years. Such possession was found to have begun on March 16, 1911, and to have ended in 1964, a period of some 53 years. The jury also found that Tex-Wis did not hold exclusive, peaceable and adverse possession of either tract for a period equal to or exceeding ten years. The trial court accordingly awarded plaintiffs title and possession to both tracts; and as mentioned, that judgment was affirmed by the Court of Civil Appeals.

Tex-Wis first complains that there is no evidence to support the jury’s finding of adverse possession of the 96-acre tract by plaintiffs. While there is ample evidence of actual possession, Tex-Wis strongly argues that possession of the land by King Alexander and his family could not be considered adverse, since such possession was based on a holding over after the 1921 foreclosure sale of the 96 acres.

It is clear that, as a general rule, a party holding over after the execution of a deed or the rendition of an adverse judgment is merely a permissive tenant; and his possession is subservient to the party holding title. Sweeten v. Park, 154 Tex. 266, 276 S.W.2d 794 (1955); Kidd v. Young, 144 Tex. 322, 190 S.W.2d 65 (1945). Consequently, such possession cannot be considered adverse until the tenancy has been repudiated, and notice of such repudiation has been brought home to the titleholder. Sweeten v. Park, supra; Mauritz v. Thatcher, 140 S.W.2d 303 (Tex.Civ.App. 1940, writ ref’d).

Actual notice of the repudiation, however, is not required. Under certain circumstances, notice may be inferred. Killough v. Hinds, 161 Tex. 178, 338 S.W.2d 707 (1960); Vasquez v. Meaders, 156 Tex. 28, 291 S.W.2d 926 (1956); Moore v. Knight, 127 Tex. 610, 94 S.W.2d 1137 (1936); Illg v. Garcia, 92 Tex. 251, 47 S.W. 717 (1898); Mauritz v. Thatcher, supra. This is the problem at hand.

While these rules are recognized, it is not clear what circumstances permit an inference of notice. Tex-Wis contends that there must be a change in the use, or the character of possession, of the land to give rise to such an inference. Since there is no evidence that Alexander or his family made any different use of the land, or in any way changed the character of their possession after the foreclosure in 1921, Tex-Wis argues that as a matter of law there could have been no notice of repudiation. There are eases which tend to support this position. See, e. g., Killough v. Hinds, supra; Sweeten v. Park, supra; Kidd v. Young, supra; Aehille v. Baird, 361 S.W.2d 439 (Tex.Civ.App.1962, writ ref’d n. r. e.); Brown v. Bickford, 237 S.W.2d 763 (Tex.Civ.App.1951, writ ref’d n. r. e.).

However, there are other cases, involving long-continued use, which permit the jury to infer notice of a repudiation without any change in the use of the land. For example, Mauritz v. Thatcher, 140 S.W.2d 303 (Tex.Civ.App.1940, writ ref’d), states that:

“Such notice may be constructive and will be presumed to have been brought home to the co-tenant or owner when the adverse occupancy and claim of title to the property is so long-continued, open, notorious, exclusive and inconsistent with the existence of title in others, except the occupant, that the law will raise the inference of notice to the co-tenant or owner out of possession, or from which a jury might rightfully presume such notice. It is held that repudiation of the claim of a co-tenant and notice thereof may be shown by circumstances and that a jury may infer such facts from long continued possession of the land under claim of ownership and non-assertion of claim by the owners.” 140 S.W.2d at 304.

See also Moore v. Knight, supra; and Illg v. Garcia, supra.

It is our opinion that this quotation remains an accurate statement of the law. This conclusion is supported by an analysis of the opinions of this Court in Sweeten v. Park and Vasquez v. Meaders, cited above. In Sweeten, this Court approved the holding of the Court of Civil Appeals that there was no evidence to support a finding of repudiation. In addition, however, we approved the following language of the Court of Civil Appeals:

“ . . .It was not contended that ap-pellees gave actual notice of a repudiation of tenancy to Mrs. A. J. Hutcherson or to her children, who were the holders of the record title from the date of the judgment until the conveyance to Lon Felts in 1938. As suit was filed on December 23, 1947, repudiation and notorious acts evidencing such repudiation must have taken place between May 30, 1934 [when the holdover tenancy began], and December 23, 1937, a period of approximately three years and seven months after the date of the judgment When we limit our consideration to this period, it is found that the possession of appellees was of substantially the same nature and kind as that maintained by them prior to the rendition of the judgment. Under ordinary circumstances, it would be sufficient to support a finding of adverse possession under the statute, but it is insufficient to show a repudiation of tenancy by acts of unequivocal notoriety.” 276 S.W.2d 794, at 798.

It is apparent from this quotation that the Court relied on the fact that the length of the adverse claimants’ possession had been only thirteen years. Since notice of repudiation is required before the ten-year statutory period begins to run, such notice had to arise during the three-year- and-seven-month period between the beginning of the holdover tenancy and the date ten years prior to the filing of the suit. Three years and seven months was not considered to be “long-continued possession” under the Mauritz rule. Since there was no change in the use of the property during that relatively brief time period (3V2 years), there was no evidence from which the jury could find or infer notice of repudiation.

The Vasquez case, on the other hand, involved twenty-seven years of hostile possession, or seventeen years in excess of the ten-year statutory period. While this Court sustained title in the adverse claimant by concluding that the character of his possession, use and occupancy was distinctly different after the holding over, this Court’s opinion also made reference to the rule of long-continued possession:

“We are of the opinion that the [Sweeten] case has no application here, but we do find language in the opinion of the Court of Civil Appeals in the [Sweeten] case which indicates that the court would have reached a different conclusion in the present case had it been of the opinion that the evidence fulfilled the requirements announced by the courts to be necessary to sustain a repudiation of tenancy of acts of unequivocal notoriety as distinguished from actual notice of repudiation. The court said, in part: ‘ . . The cases sustaining repudiation of tenancy by acts of unequivocal notoriety as distinguished from actual notice of repudiation, generally rely upon long continued possession and user coupled with nonclaimer on thé part of the true owner. For instance, it may be that the evidence in this case would fulfill these requirements if the date of December 23 of the year 1945 were taken, but it is not sufficient to show the requisite quality of possession at the time of the crucial date of this lawsuit, that is, December 23, 1937, ten years prior to the filing of appellant’s petition. . . . ’ We simply hold that the crucial time of the present lawsuit is the year 1939, the lawsuit having been filed in 1949, and that the evidence meets the test as laid down by previously decided cases.” .291 S.W.2d 926, at 928.

The opinion concludes with quotations from Moore v. Knight, supra, and Mauritz v. Thatcher, supra, that constructive notice will be presumed to have been brought home to the owner where the adverse occupancy and claim of title to the property is so long-continued, open, notorious, exclusive and inconsistent with the existence of title in others, except the occupant, that the law will raise an inference of notice.

We recognize that the dissent in Vasquez took the position that the opinion of the majority of the Court evidently rejected mere length of ordinary adverse possession plus non-assertion of title by the owner as a sufficient basis for constructive notice of adverse possession. We cannot agree with this interpretation. Had this been the majority’s intent, it would not have quoted with approval the language of the Court of Civil Appeals in Sweeten that “the cases sustaining repudiation of tenancy by acts of unequivocal notoriety . . . generally rely upon long continued possession and user coupled with nonclaimer on the part of the true owner.” Nor would it have relied on Moore v. Knight, supra, and Mauritz v. Thatcher, supra, which state that rule.

We see no inconsistency between the rule announced in the Mauritz case and the one applied in Sweeten. Each is nothing more than an application of the rule of circumstantial evidence that the existence of certain facts tends to support a reasonable inference that the record owner has been put on notice that the tenancy has been repudiated. To this extent, both satisfy the rationale for requiring such notice. Where a tenancy relationship has arisen, the landlord is normally justified in assuming that the tenant’s use of the premises is permissive and in recognition of the landlord’s title. However, under certain circumstances, this assumption ceases to be justifiable. Thus acts which are inconsistent with the original use of the property may be sufficient to put the owner on notice that the tenancy has been repudiated. The same has been held to be true in eases of long-continued possession by the tenant under claim of ownership where the landlord has failed to assert any claim. Under such circumstances, the jury may find that continued reliance on the tenancy by the landlord was unreasonable and unwarranted.

Consequently, we hold that the jury may infer that notice of repudiation has been brought home to the titleholder where there has been (1) long-continued possession under claim of ownership and (2) nonassertion of claim by the titleholder. By “nonas-sertion of claim by the titleholder,” we mean the absence of any overt act of ownership on the part of the record owner which is inconsistent with notice of a repudiation. For example, payment of taxes by the titleholder has been held to be a sufficient assertion of ownership. Achille v. Baird, 361 S.W.2d 439 (Tex.Civ.App.1962, writ ref’d n. r. e.). Entry or a similar exercise of dominion over the premises is not required.

It should be emphasized that this holding in no way limits or restricts the rule that a change in the use or character of possession of the land is sufficient to support a finding of notice of repudiation. In cases of that kind, notice may be inferred regardless of the length of possession.

In the present case, there is no evidence of any change in use or character of possession after 1921. Consequently, plaintiffs must rely on the rule of long-continued possession and nonclaimer by the owner. The plaintiffs’ period of adverse possession must have been completed by 1955. In determining the period of possession, the “crucial time” referred to in Vasquez (before which notice of repudiation must have been given or inferred) is the year 1945,—this being ten years prior to the latest date at which plaintiffs’ possession could have satisfied the requirements of adverse possession. The circumstances giving rise to an inference of notice, therefore, must be found in the twenty-four year period between 1921 (when the holdover tenancy began) and 1945 (the “crucial time”). There is evidence in the record that Alexander, or persons claiming under him, maintained open and continuous possession inconsistent with title in others during this twenty-four years. The record reflects that, during this time, the Alexander family resided on the 96 acres in five separate residences. They farmed the land, maintained fences and ran livestock on it. There is also evidence that no claim was asserted by the record owner during this time. From such circumstances the jury could reasonably infer that there had been brought home to the owner of, the property .notice that Alexander and his family had repudiated the tenancy and were claiming title in themselves. . Since there is evidence in support of the jury’s findings, which the Court of Civil Appeals has held to be sufficient, the fact issue is established; and we cannot hold to the contrary. See Martinez v. Delta Brands, Inc., 515 S.W.2d 268 (Tex. 1974); Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 Texas L.Rev. 351, 363 (1960).

It may be noted that we make no attempt to set out any precise test for determining “long-continued” possession. The number of years required may vary according to the circumstances of the particular case. This is not to say that there is no minimum requirement. In the Sweeten case, three years and seven months was held to be insufficient. On the other hand, we feel that 24 years in excess of the 10-year statutory period falls within the Mau-ritz rule, as constituting “long-continued” possession.

Tex-Wis also challenges the two jury findings of adverse possession by claiming that there is no evidence of possessory acts by plaintiffs or their predecessor as to either the 96-acre or the 53-acre tract. The evidence is to the contrary. It clearly appears from the record that Alexander, or those claiming under him, lived upon, farmed, and raised livestock on the 96-acre tract for a period well in excess of ten years. Likewise, there is evidence that similar possessory acts extended to the 53-acre tract. This point is overruled.

Tex-Wis further maintains that, as a matter of law, it acquired limitation title to the 150 acres under the ten-year statute. This claim is based upon the use and possession by C. W. McKnight who entered the premises under a lease with Tex-Wis. While there is conflicting evidence as to the exact date of McKnight’s entry in the 1950’s, the evidence most favorable to the jury’s finding indicates the entry was in 1955. However, there is evidence that Kitty Alexander, who is King Alexander’s daughter and one of the plaintiffs, continued to reside on the land until 1964. This suit was filed in 1972, only eight years later. As a result, Tex-Wis failed to establish as a matter of law that it had exclusive possession for a period of ten consecutive years.

Tex-Wis contends that the plaintiffs are precluded from relying on the evidence that Kitty Alexander remained in possession until 1964. It argues that the following portion of the deposition testimony of Kitty Alexander, then 90 years of age, operates as a judicial admission, and prevents any finding that her possession extended beyond the early 1950’s.

“Q: . . . How many years has it been since you moved from that place [the 150 acres]?
“A: Oh, it has been a long time.
“Q: Well, do you know about how many years?
“A: Oh, about twenty or thirty years away from there.”

As a general rule, the testimonial declarations of a party will not be given the force and effect of a judicial admission. See United States Fidelity & Guaranty Co. v. Carr, 242 S.W.2d 224 (Tex.Civ.App.1951, writ ref’d); and Stafford v. Wilkinson, 157 Tex. 483, 304 S.W.2d 364 (1957). In order to bind a party to his admission, a five-prong test has been prescribed. One of these requirements is that the statement be deliberate, clear, and unequivocal, and the hypothesis of mere mistake must be eliminated. Griffin v. Superior Insurance Co., 161 Tex. 195, 338 S.W.2d 415 (1960); United States Fidelity & Guaranty Co. v. Carr, supra. Kitty’s advanced age at the time of the deposition is a relevant factor; and there was testimony by other witnesses, several of whom had no interest in the suit, which indicated that she had remained on the premises until 1964. In addition, Kitty’s statement set out above is but a small part of her deposition testimony. Plaintiffs’ attempt to introduce other parts in explanation was blocked by objection of Tex-Wis. Under these circumstances, Kitty’s statement that she had moved away from the 150 acres “about twenty or thirty years ago,” taken in context, will not be considered to be a judicial admission which is binding on the plaintiffs. It was and is relevant, and was evidence to be considered by the jury. United States Fidelity & Guaranty Co. v. Carr, supra. The point is overruled.

The judgment of the Court of Civil Ap-peajg jg affirmed.

      . It appears that these field notes actually describe an area of approximately 53 acres. For this reason, the tract is referred to as the 53-acre tract.

      . These are not the appropriate dates for determining the period of adverse possession. Since Alexander held record title subject to a deed of trust to the 96 acres between 1918 and the 1921 foreclosure sale, his possession prior to 1921 does not bear upon the plaintiffs’ claim of adverse possession as to that tract. The 1964 date is also inappropriate. The evidence establishes that an agent of Tex-Wis came into possession of the 150 acres no later than 1955. As discussed below, this entry destroyed the exclusivity of plaintiffs’ possession. If they acquired title by limitation, they must have perfected their claim prior to this date.

      . All emphasis in this opinion has been supplied by this Court unless otherwise indicated. The above quotation in Mauritz is taken in substance from Moore v. Knight, 127 Tex. 610, 94 S.W.2d 1137 at 1140.

      . While there is language in the Achille case which appears to conflict in some respects with the present holding, we think the result there was correct because of the fact that the record owners had paid taxes on the disputed property. As the opinion in that case recognized, this fact would preclude an inference of notice of repudiation based on the rule of long-continued possession.

      . Plaintiffs concede that an agent of Tex-Wis came into possession of the 96-acre tract in 1955. Therefore, the exclusivity of their possession was destroyed; and if they are to acquire title by limitation, their claim must have been perfected before this date.

      . As an alternative argument on appeal, plaintiffs contend that their claim should not be tied to Alexander’s possession, but that it should be viewed as an independent claim of right. By characterizing them- . selves as naked trespassers, as opposed to permissive tenants, they seek to avoid the requirement of repudiation. However, there is no basis in the record for this position. This suit was brought by the heirs of King Alexander and was tried accordingly. A tenancy, relationship having been established as to Alexander, it attached to all his successors. Cox v. Kirby Lumber Corp., 129 S.W.2d 376 (Tex.Civ.App.1939, writ refd). The fact that plaintiffs are Alexander’s heirs permits the tacking of their possession after his death to his possession. Hutto v. Cook, 139 Tex. 571, 164 S.W.2d 513 (1942).

      . Since we have found that there is evidence to support the jury’s finding and the trial court’s judgment that plaintiffs have acquired title to the 53 acres by adverse possession, no useful purpose would be served by discussing the points of error involving plaintiffs’ claim of record title to the tract.


source: Caselaw Access Project

author: McGEE, Justice.

license: Public Domain

text:
    GONZALES COUNTY SAVINGS AND LOAN ASSOCIATION, Petitioner, v. Charles R. FREEMAN, Jr. et ux., Respondents.
    No. B-5598.
    Supreme Court of Texas.
    April 14, 1976.
    Rehearing Denied May 19, 1976.

      R. L. Miller, Gonzales, for petitioner.
    Elick & Elick, John V. Elick, Bellville, for respondents.
   McGEE, Justice.

This case involves a question of usury. The Freemans brought suit against the Gonzales County Savings & Loan Association, alleging that the interest rate on a $38,400 loan made to them by the savings and loan association exceeded the 10 percent per annum permitted by Article 5069-1.02. Under the terms of the note, the $38,400 principal was due one year from the date of execution, with interest computed at the rate of 9 percent per annum. In addition, the Freemans were charged a fee of $768, or 2 percent of the principal, as a “loan fee.” The Freemans contended that the “loan fee” of 2 percent constituted interest and when taken together with the stated interest rate of 9 percent, the total charge for interest was in excess of the 10 percent rate allowed by law. Thus, they argued that because the interest charge constituted usury, they were entitled to recover double the amount of interest “contracted for, charged, or received.” Art. 5069-1.06. The savings and loan association contended that the “loan fee” was not interest for two reasons. First, they argued that such fee was a “commitment fee,” and therefore, the charge did not fit within the statutory definition of interest. Secondly, they maintained that the loan fee was a “premium” under Article 852a, Section 5.07, which provides that premiums charged for the making of loans are not deemed to be interest for the purpose of determining usury.

Both the Freemans and the savings and loan association filed motions for summary judgment. The trial court granted a summary judgment for the savings and loan association. The court of civil appeals reversed and remanded. Tex.Civ.App., 526 S.W.2d 774. We agree with the judgment of the court of civil appeals and its disposition of the case. However, we cannot agree with some of the statements made by that court.

The savings and loan association agreed to extend the $38,400 loan to the Freemans so that they could construct two houses for future resale. In order for the Freemans to obtain this loan, they were required to pay certain expenses and charges upon closing. The charges were set forth in the loan settlement or closing statement furnished by the lender. There were, among others, charges for an appraisal, several inspections, and for attorney’s fees. The fee in controversy was a charge for $768 denominated as a “loan fee.” Item B(8) of the closing statement read as follows:

“8. Other charges (premium, commission or loan fee, etc.) Loan Fee 768.00.”

The Freemans failed to make their first semi-annual interest payment. Thereafter, they brought this suit alleging that this 2 percent “loan fee” was in reality an interest charge.

The summary judgment granted in favor of the savings and loan association may be upheld only if the record establishes a right thereto as a matter of law. Gibbs v. General Motors Corporation, 450 S.W.2d 827 (Tex.1970). Further, there must have been no genuine issue of material fact present. Torres v. Western Casualty and Surety Company, 457 S.W.2d 50 (Tex.1970). In support of their position the savings and loan association maintains that this “loan fee” was proper consideration for having a permanent loan available for the Freemans’ benefit. Mr. Majefski, an officer of the savings and loan association, stated in his deposition that this was one of the meanings he ascribed to the “loan fee” charge. Thus, such a fee was allegedly charged apart from the original $38,400 loan since the “loan fee” was intended only as compensation for allowing the Freemans the opportunity to make another loan in the near future. At this point, the court of civil appeals concluded that if this were true, the “loan fee” would be a “commitment fee” and as such, it would constitute interest. We disagree with that statement made by the court of civil appeals. The court of civil appeals has improperly stressed the labels placed upon the charges by the savings and loan association as being controlling of their real nature. It has often been said that courts will look beyond the form of the transaction to its substance in determining the existence or nonexistence of usury. See, Schmid v. City Nat. Bank of Wichita Falls, 132 Tex. 115, 114 S.W.2d 854 (1938). Such a rule is to be fairly applied to both borrowers and lenders alike. Labels put on particular charges are not controlling. A charge which is in fact compensation for the use, forbearance or detention of money is, by definition, interest regardless of the label placed upon it by the lender. Art. 5069-1.01(a). On the other hand, a fee which commits the lender to make a loan at some future date does not fall within this definition. Instead, such a fee merely purchases an option which permits the borrower to enter into the loan in the future. See, e. g., Financial Federal Savings & Loan Association v. Burleigh House, Inc., 305 So.2d 59 (Fla.Dist.Ct.App. 1974); D & M Development Co. v. Sherwood & Roberts, Inc., 93 Idaho 200, 457 P.2d 439 (1969); Prather, Mortgage Loans and the Usury Laws, 16 Bus.Law. 181, 188 (1960). It entitles the borrower to a distinctly separate and additional consideration apart from the lending of money. Therefore, the lender may charge extra for this consideration without violating the usury laws. Greever v. Persky, 140 Tex. 64, 165 S.W.2d 709 (1942).

The court of civil appeals relied on Imperial Corporation of America v. Frenchman’s Creek Corporation, 453 F.2d 1138 (5th Cir. 1972) for the proposition that “commitment fees” are, by operation of law, front-end interest. However, the “commitment fee” in that case does not appear to have been a charge for having a loan available in the future. Instead, the obligation to pay the “commitment fee” seems to have arisen only after the parties had entered into the loan agreement. The trial court found that the $67,000 “commitment fee” was interest, and the lender did not contest such finding. Similarly, the other cases cited by the court of civil appeals did not involve fees given in return for an option to enter into a loan in the future. See, Nevels v. Harris, 129 Tex. 190, 102 S.W.2d 1046 (1937) and Laid Rite, Inc. v. Texas Industries, Inc., 512 S.W.2d 384 (Tex.Civ.App. — Fort Worth 1974, no writ).

It should be emphasized that this opinion is limited to bona fide commitment fees. Charges which are in fact interest remain so, regardless of the label used. Where there is a dispute in the evidence as to whether the charge is merely a device to conceal usury, a question of fact is raised for the jury. Greever v. Persky, supra; 45 Am.Jr.2d Interest and .Usury, § 200 at 157 (1969); Annot., 81 A.L.R.2d 1280, §§ 2 and 3 at 1282-3 (1962). For example, whether or not a charge labeled a “commitment fee” is merely a cloak to conceal usury may depend upon whether or not the fee is unreasonable in light of the risk to be borne by the lender. In the instant case a fact issue was present as to whether or not this “loan fee” constituted a valid commitment fee. If the evidence produced at the new trial results in a finding of fact that the “loan fee” was a legitimate “commitment fee” in the sense that it was intended only as compensation for having the future loan available, and for no other purpose, then such fee is not interest.

The savings and loan association has also attempted to justify the existence of the “loan fee” by asserting that such a charge was a “premium.” Their contention is that the Legislature intended the term “premium” to represent an amount paid or charged for the right to enter into the loan. They maintain that this $768 “loan fee” is in reality a “premium” which the Legislature, by Article 852a, Section 5.07, has authorized them to charge.

The Texas Constitution, Article 16, Section 11, authorizes the Legislature to regulate lenders and establish maximum rates of interest. Section 11 reads in pertinent part as follows:

“The Legislature shall have authority to classify loans and lenders, license and regulate lenders, define interest and fix maximum rates of interest; provided, however, in the absence of legislation fixing maximum rates of interest all contracts for a greater rate of interest than ten per centum (10%) per annum shall be deemed usurious; . . . ” (Emphasis

added).

Pursuant to this authority, the Legislature in 1963 enacted the “Texas Savings and Loan Act,” Article 852a, Tex.Rev.Civ.Stat. Ann., taking effect January 1, 1964. Included within such act is Section 5.07 which provides in pertinent part:

“Sec. 5.07. Every association may require borrowing members to pay all reasonable expenses incurred in connection with the making, closing, disbursing, extending, readjusting or renewing of real estate loans, which such charges may be collected by the association from the borrower and retained by it or paid to any persons, including any director, officer, or employee of the association rendering services in connection therewith, or paid directly by the borrower. In addition, associations may charge premiums for making such loans as well as penalties for prepayments or late payments; provided, that unless agreed in writing to the contrary, any prepayment of principal shall be applied on the final installment of the note or other obligation until fully paid, and thereafter on the installments in the inverse order of their maturity. The expenses, fees and charges authorized herein shall be in addition to interest authorized by law, and shall not be deemed to be a part of the interest collected or agreed to be paid on such loans within the meaning of any law of this State which limits the rate of interest which may be exacted in any transaction. . ” (Emphasis added).

The problem presently confronting us concerns our interpretation of the term “premium.” The petitioner, Gonzales County Savings and Loan Association, contends that Section 5.07 of Article 852a as drafted grants to savings and loan associations the authority to charge borrowers an open-ended initial charge for the right to receive a loan. They argue that such a charge is not interest because it is a “premium” under Section 5.07.

Article 16, Section 11 of the Texas Constitution expressly grants the Legislature the authority to “define interest and fix maximum rates of interest.” In an effort to exercise this authority, the Legislature enacted Section 5.07 of Article 852a seeking to exclude certain charges made by savings and loan associations from being considered as constituting interest. As was stated earlier, courts must look beyond mere labels to the substance of many charges in order to be able to determine whether such fees in reality constitute usury. See, Temple Trust Co. v. Sewell, 133 Tex. 417, 126 S.W.2d 943 (1939). It is evident that the Legislature established no maximum rate allowable on those charges termed “reasonable expenses” or “penalties.” However, in the case of reasonable expenses, courts can clearly meet their duty to consider substance over form since we may determine the reasonableness of the expenses in light of the amount of actual work done. Further, penalties need bear some reasonable relationship to the amount of loss or inconvenience suffered by the lender due to prepayment or late payment by the borrower. Such a thorough examination would obviously be impossible in those instances where a lender asserted that a charge levied was a “premium.” Savings and loan associations may not be allowed a convenient avenue of escape from the usury laws by simply contending that a front-end charge they require borrowers to pay is a legislatively authorized “premium” and therefore, not interest. As Section 5.07 dealing with premiums now stands, courts are unable to look beyond the mere label to the substance of the word in order to discern its true nature.

Thus, an extremely complex problem has arisen concerning the Legislature’s power to “define interest and fix maximum rates of interest.” The Legislature has attempted to exclude from consideration as interest a charge which would otherwise plainly fit within the definition of “interest” as set out in Article 5069-1.01(a). With reference to “premiums,” Section 5.07 of Article 852a does not purport to define interest and cannot be regarded as an attempt by the Legislature to fix maximum rates of interest. See, Community Finance & Thrift Corp. v. State, 161 Tex. 619, 343 S.W.2d 232 (1961). In the absence of language setting a maximum rate for such charges or an appropriate modification of the definition of “interest,” such “premium” charges will be deemed to constitute interest when seeking to determine the existence or nonexistence of usury.

The case before us is on summary judgment. The only evidence concerning the true purpose of the “loan fee” comes from the oral deposition of Henry Majefski, the executive vice president of the savings and loan association, and from the Loan Settlement Agreement supplied by the association. As noted by the court below, Majefski’s testimony shows at least two possible purposes of the “loan fee.” First, he stated that it was consideration for having a permanent loan available for the Freemans’ benefit. Later he testified that it was intended to cover the expenses of negotiating the loan. The Loan Settlement Agreement listed the loan fee as one of the “expenses incurred in connection with this [the one-year] loan.” As the court of civil appeals correctly pointed out, the savings and loan association did not establish as a matter of law that the two percent “loan fee” was a “reasonable” expense. The burden was on the savings and loan association as the movant to establish the true nature of this “loan fee” and that burden was not discharged. It has not been established that this “loan fee” constituted a valid commitment fee nor has it been revealed whether or not such charge represents a fee to cover “reasonable” expenses. It is clearly evident that the real nature of this charge has not been established as a matter of law and that the remand was therefore proper. The judgment of the Court of Civil Appeals is correct and is hereby affirmed.

      . Statutory references are to Vernon’s Texas Civil Statutes Annotated.

      . Tex.Rev.Civ.Stat.Ann. article 5069-1.-01(a)(1971) defines “interest” as “ . the compensation allowed by law for the use, forbearance or detention of money; ...” See also, Art. 5069-2.01(h).

      . Tex.Rev.Civ.Stat.Ann. article 5069-1.02 (1971) provides:

        “Except as otherwise fixed by law, the maximum rate of interest shall be ten percent per annum. A greater rate of interest then ten percent per annum unless otherwise authorized by law shall be deemed usurious. All contracts for usury are contrary to public policy and shall be subject to appropriate penalties prescribed in Article 1.06 of this Subtitle.” (Emphasis added).


author: GREEN, Commissioner.

text:
    Billy Hurbert HARGETT, Appellant, v. The STATE of Texas, Appellee.
    No. 51253.
    Court of Criminal Appeals of Texas.
    March 24, 1976.
    Rehearing Denied March 31, 1976.
    Kerry P. Fitzgerald, Dallas, for appellant.
    Henry Wade, Dist. Atty., W. T. West-moreland, Jr., Les Eubanks and Richard Worthy, Asst. Dist. Attys., Dallas, Jim D. Vollers, State’s Atty., and David S. McAngus, Asst. State’s Atty., Austin, for the State.
   OPINION

GREEN, Commissioner.

In a trial before a jury, appellant was convicted of burglary of a habitation. See V.T.C.A. Penal Code, Sec. 30.01(1), Sec. 30.-02(a)(1). Punishment was assessed by the court at eighteen years.

Among appellant’s grounds of error is the contention that the evidence is insufficient to show that the structure burglarized was in fact a habitation as that term is defined in V.T.C.A. Penal Code, See. 30.01(1).

The house involved was located at No. 923 Lilac Street in Mesquite, Dallas County. Len E. Clark testified that he owned several houses which he rented periodically, one of which was the house at 923 Lilac. During the weekend starting Saturday, March 23, 1974, Clark was in negotiations with John Poland to rent this house furnished with furniture belonging to Clark. On Sunday night, March 24th, the house was rented, but the Polands had not as yet moved in, .and Clark testified that he had custody and control of the house and furniture. The evidence reflects that the house was completely furnished and ready for occupancy. However, Clark also testified that “John Poland, who had rented the house, possibly had moved something in, because I didn’t know what he had moved in or not and it was several days (after the burglary) before I saw him and asked him if he had anything missing.”

The evidence reflects that shortly after midnight on Monday, March 25, the house involved was burglarized, and much of the furniture was stolen. Among items recovered by the police that night and identified by Clark were a red vinyl couch and chair, a walnut bedroom dresser, a mirror and a couple of end tables. Later other pieces of furniture including parts of a bed were recovered and identified by Clark. A confession was obtained from appellant, and admitted in evidence.

V.T.C.A. Penal Code, Sec. 30.02 (Burglary) in its relevant portion reads:

“(a) A person commits an offense if, without the effective consent of the owner, he:
(1) enters a habitation, or a building (or any portion of a building) not then open to the public, with intent to commit a felony or theft; or . . .”

This section provides that all burglaries are felonies of the second degree with certain named exceptions which are felonies of the first degree. A burglary of a habitation is made a first degree felony, punishable as such.

Section 30.01(1) defines “habitation” as meaning “a structure or vehicle that is adapted for the overnight accommodation of persons.” Subsection (2) defines “building” as meaning “any enclosed structure intended for use or occupation as a habitation or for some purpose of trade, manufacture, ornament, or use.”

In Jones v. State, 532 S.W.2d 596, (Tex.Cr.App.1976), we were confronted with the contention that the burglarized structure there involved was not in fact a habitation as defined in the Penal Code, supra. That house was owned by Richard Farrell, a contractor, who testified that he had a contract for the sale of the completed house the day before the burglary, but that possession had not changed hands. No one was living there, or had lived there. There was no furniture in the house, no refrigerator, and while there were light fixtures, there may not have been “power,” although there was a water connection.

After a thorough discussion of the present and prior laws regarding burglary, and after contrasting the provisions of the present Code, and particularly Sections 30.-01 and 30.02, with the article of the former Penal Code dealing with burglary of a private residence at night and other statutes, and after comparing the definition of “habitation” with the definition of “building,” we concluded that for the structure to be a “habitation” so as to make its burglary a first degree felony, “the structure or vehicle must at the time of the alleged offense have been actually ‘adapted for the overnight accommodation of persons’ or at least at some prior time and still used for the overnight accommodation of persons,” and not merely a structure that is “intended for use or occupation as a habitation . . . ”

In Jones, supra, this Court held that the vacant house in which no one was living or had lived and which contained no furniture, under the circumstances there proved, was not shown to be a habitation. We further held, however, that the second degree felony of burglary of a building, V.T.C.A. Penal Code, See. 30.01(2) and Sec. 30.02(a)(1), is a lesser included offense of burglary of a habitation where the proof shows an enclosed structure, and since the trial was before the court on a plea of guilty, and the punishment was assessed by the court within the range both of a felony of the first degree and of the second degree, the conviction could be affirmed as a conviction for burglary of a building with the judgment and sentence being reformed accordingly.

In the instant case, we conclude that the testimony of the owner Clark is sufficient to prove that the house was a habitation when burglarized. It had been rented complete with furniture so that it certainly was adapted for the overnight accommodation of persons. The record is silent as to any utilities. This house was not shown to be a new one which had never been lived in, but one of several houses which Clark “rented periodically.” Clark thought that the tenant Poland had moved some things into the house and after the burglary asked him if “he had anything missing.” Poland’s answer was struck from the record on appellant’s objection.

The evidence is sufficient to sustain the conviction.

In his third ground, appellant contends that the State committed reversible error in commenting on the failure of appellant to testify.

In his brief, appellant directs our attention to the following remark of the prosecuting attorney made after summarizing the State’s evidence in closing his opening jury argument, together with appellant’s objection and the court’s ruling:

“Now that’s the undisputed evidence in this case.
“MR. BANNER [Defense Counsel]: Your Honor, I object to the continual reference by the district attorney on undisputed evidence as a comment on the Defendant’s failure to testify.
“THE COURT: Overrule the objection.
“MR. WORTHY [State]: The undisputed evidence shows just one thing, that is that Billy Hargett is in fact guilty of burglary, for which he is charged in this case before you today.”

A statement that the evidence is uncontroverted is not a comment upon appellant’s failure to testify where the record indicates a person other than the defendant could have offered contradictory evidence. Nowlin v. State, Tex.Cr.App., 507 S.W.2d 534; Bolden v. State, Tex.Cr.App., 504 S.W.2d 418; Curlin v. State, Tex.Cr.App., 500 S.W.2d 141.

In Gorman v. State, Tex.Cr.App., 480 S.W.2d 188, the prosecutrix testified that she was raped by the defendant and his companion, Fowler, who was also under indictment for the offense. Defendant did not testify. In holding as no reversible error the prosecutor’s remark to the jury: “The testimony we have brought to you today is credible. Nobody has refuted it,”

we said: “Fowler, appellant’s companion, could have testified concerning the prosecu-trix’ acquiescence and, therefore, the prosecutor’s remarks, though questionable, were not improper.”

The record reflects that on the night of the burglary police officers on patrol noticed a Pontiac car and a pick-up truck removing furniture from the house involved. After contacting Len Clark, and learning that he knew nothing of the removal of the furniture, the officers stopped the Pontiac after it had left the house with a load of furniture and arrested the driver, Doris Hargett, and her fifteen year old companion Val Jean James. As a result of a conversation with Doris Hargett, the officers went to a house where they found appellant, his pick-up truck, and some of the stolen furniture. He later confessed to the burglary. He did not testify before the jury, and placed no witnesses on the stand.

As in Gorman v. State, supra, either Doris Hargett or Val Jean James could have testified concerning the facts relevant to the burglary, and therefore “the prosecutor’s remarks, though questionable, were not improper.”

See also Manning v. State, Tex.Cr.App., 393 S.W.2d 910.

The ground of error is overruled.

Appellant’s fourth ground of error reads:

“The Trial Court committed reversible error in excluding evidence that the witness Doris Jean James Hargett had been No Billed by the Dallas County Grand Jury, as said evidence was beneficial to the Appellant tending to establish that one of the promises allegedly made to Appellant in her behalf was in fact kept and that the confession was extracted by such promises and persuasion.”

Appellant argues that he wanted to prove that Doris Jean James Hargett was no-billed by the same grand jury that indicted him to prove that the officer taking the confession kept his promise that she would not be indicted if he confessed. She did not testify in the trial. Appellant did not testify before the jury, and there was no evidence introduced before the jury of any promise made to appellant as an inducement to secure his confession. The officer taking the confession definitely denied on cross-examination of making any such promises.

The fact that Doris Jean James Hargett was not indicted was not admissible on the issue of appellant’s guilt. See Adams v. State, Tex.Cr.App., 531 S.W.2d 626; Walker v. State, Tex.Cr.App., 530 S.W.2d 572. There being no fact issue present of any promises made to appellant if she was not indicted, the contention is without merit.

By separate ground of error, appellant asserts that he was denied the effective assistance of counsel by virtue of a conflict of interest in the joint representation of appellant and Doris Jean James Hargett, hereafter called Doris Hargett, by the same retained counsel.

On the day this case went to trial, a hearing was conducted before the court on appellant’s motion to suppress his confession. After the officer taking the confession and appellant testified, appellant’s employed attorney filed a motion for a continuance until after a hearing on a motion to revoke the parole of Doris Hargett so that she could testify freely on appellant’s motion to suppress and at his trial. The motion sworn to by appellant and his counsel alleged a conflict of interest as follows:

“If Tim K. Banner calls Doris J. Hargett to testify in the hearing to suppress the confession, and if she incriminates herself, he will be guilty of ineffective assist-anee of counsel to Doris Hargett. If Tim K. Banner fails to call Doris Hargett because of the conflict, he will be guilty of ineffective assistance of counsel to Billy Hargett.”

Attached to the motion is an affidavit of Tim K. Banner, attorney for appellant, stating what he expected Doris Hargett would testify if placed on the stand. However, counsel expressly declined to present this affidavit to the court at the hearing. Instead of doing so, counsel stated he, as her lawyer, would advise her not to testify, but “to take the Fifth Amendment.”

On appeal, appellant does not contend the court erred in overruling his motion for continuance. His sole complaint is that he was denied effective representation of counsel due to a conflict of interest of retained counsel.

The record fails to reflect that appellant was denied anything in the way of legal counsel. He had retained counsel of his choice and knew that his attorney also represented Doris Hargett. He declined to join in the State’s suggestion that the trial court appoint a lawyer to advise Doris Hargett on her rights and determine if she wished to testify. There is no showing that appellant was not fully apprised of the potential risks inherent in his retained counsel’s dual representation. He continued to employ Tim K. Banner as his trial lawyer. There is no showing, in short, that retained counsel breached his legal duty to appellant. See Pete v. State, Tex.Cr.App., 533 S.W.2d 808 (1976); Ex parte Hill, Tex.Cr.App., 528 S.W.2d 259; Ex parte Railey, Tex.Cr.App., 528 S.W.2d 257.

The record fails to reflect any conflict of interest on the part of retained counsel that was prejudicial to appellant, and the record fails to reflect that appellant was not fully advised of the risk of any conflict of interest that may have arisen. See Pete v. State, supra; States v. State, Tex.Cr.App., 530 S.W.2d 309.

The ground of error is overruled.

We have considered appellant’s pro se brief and find it to be without merit.

The judgment is affirmed.

Opinion approved by the Court.

      . The evidence before the jury is not definite as to whether Doris Hargett was the wife of appellant. The officers were not sure whether she was or was not his wife.


author: DUNAGAN, Chief Justice.

text:
    HEIL COMPANY, Appellant, v. Valmarie GRANT et al., Appellees.
    No. 872.
    Court of Civil Appeals of Texas, Tyler.
    Jan. 29, 1976.
    Rehearing Denied March 4, 1976.

      Gordon H. Rowe, Jr., Gardere, Porter & DeHay, Dallas, for appellant.
    Windle Turley, Dallas, Franklin H. Perry, Thompson, Coe, Cousins & Irons, Dallas, for appellees.
   DUNAGAN, Chief Justice.

This is a products liability case which involves the doctrines of assumption of risk and misuse, the “Dead Man’s” Statute and exemplary damages. Valmarie Grant and her children sued for the death of James Grant (hereinafter referred to as Decedent), ■ their husband and father respectively. The defendant-appellant is the Heil Company, a major manufacturer of hydraulic hoists.

Decedent was killed on February 18, 1972, while assisting his brother, Vernon Grant, in making repairs on Vernon Grant’s dump truck. The dump truck was equipped with a telescopic sleeve hoist designed and sold by the Heil Company for the purpose of raising the bed of the truck. The hoist is operated by a mechanism consisting basically of a control valve with levers inside the cab, a hydraulic pump and a partially exposed “pullout” cable which runs lengthwise beneath the bed. The injection of oil into the telescopic sleeve raises the bed until the pullout cable becomes taunt and pulls a valve in the control assembly into a neutral position. The bed is lowered by pushing the valve into another position. This is normally accomplished with the levers inside the cab but can occur when the exposed portion of the pullout cable is struck.

Decedent and Vernon were working beneath the raised bed when it somehow descended. Vernon jumped away but Decedent did not. Heil Company’s engineer found no malfunction in the hoist mechanism and concluded that the pullout cable had been tripped. Immediately before the accident, Vernon told Decedent that if he hit the pullout cable, the bed would come down. This portion of Vernon’s testimony was preserved in appellant’s bill of exception as it was excluded under the Dead Man’s Statute. In this same bill, Vernon testified that he would not normally work under the raised bed without bracing it with some wooden blocks which he had at home.

Plaintiffs sued the Heil Company under a theory of strict liability for defective design of the hoist mechanism and for failure to warn of the hazard. Plaintiffs alleged that, as a direct and proximate result of the wrongful death of James Grant, they had suffered a loss of his support, guidance and companionship. They further sought recovery for their mental anguish resulting from their observations upon their arrival at the scene immediately after the accident. Finally, they sought recovery in the form of exemplary damages. The Heil Company answered with affirmative defenses and im-pleaded Vernon Grant seeking contribution and indemnity. Vernon’s motion for instructed verdict was sustained.

The jury found that the producing causes of the death were: (1) the pullout cable which was defectively designed because it was not accompanied by adequate warnings (Special Issues 1 through 3); (2) the control valve, which was defectively designed for the same reason (Special Issues 4 through 6); (3) Heil Company’s failure to supply a brace (Special Issues 7 and 10); and (4) Heil Company’s failure to provide bracing instructions (Special Issues 8 and 10). The damages awarded pursuant to these findings will be discussed subsequently.

The Heil Company pleaded, offered evidence of and requested Special Issues on the defenses of assumption of risk and misuse. The trial court, applying the Dead Man’s Statute, excluded that portion of Vernon Grant’s testimony which related to those defenses and refused to submit Special Issues thereon since there was no other evidence to support such issues. Heil Company’s primary contention before this court is that the exclusion of Vernon Grant’s testimony was harmful error because that testimony was admissible and established or raised fact issues of those defenses. Plaintiffs respond that (1) even if the exclusion was erroneous, it was not harmful, and (2) Vernon Grant’s testimony was properly excluded. We will discuss these contentions in the order set forth by plaintiffs.

ASSUMPTION OF RISK

Plaintiffs’ Reply Point I is that the issue of assumption of risk could not have been submitted to the jury even if Vernon Grant’s testimony had not been excluded. The arguments under this point are threefold. Plaintiffs first contend that “no evidence raised the necessary elements of assumption of risk.” The theory of the assumption of risk defense is that a person may not recover for an injury received when he voluntarily exposes himself to a known and appreciated danger. Halepeska v. Callihan Interests, Inc., 371 S.W.2d 368, 379 (Tex.1963). The doctrine of assumed risk is harsh and will not be extended. Ellis v. Moore, 401 S.W.2d 789, 794 (Tex.1966). Clearly, if there was no evidence of one or more of the elements of the doctrine, any error in excluding the portions of Vernon Grant’s testimony relating thereto was harmless.

Plaintiffs contend that Vernon Grant’s warning to Decedent (“I stated . that if he hit the cable, the bed would come down”) did not constitute evidence that Decedent “knew” of the risk. Plaintiffs argue that Decedent might not have heard, understood or remembered the warning and that Vernon Grant’s testimony was merely evidence that Decedent could have known of the risk.

An injured person’s knowledge of a dangerous condition or defect is measured rt i f subjectively; i. e., by that person’s actual, conscious knowledge. Massman-Johnson v. Gundolf; 484 S.W.2d 555, 557 (Tex.1972). The fact that the injured person should have known of the danger will not support the assumption of risk defense. Halepeska v. Callihan Interests, Inc., supra. Sometimes, however, that person may know such facts as to be charged with knowledge of Í the danger. Halepeska v. Callihan Interests, Inc., supra. This standard would be applied when it was difficult or impossible to determine the state of the injured person’s mind; as it was in the instant case of a fatal injury. The “actual knowledge or charged knowledge” test has been applied in determining the strict liability of a supplier of defective products. See Rourke v. 1 Garza, 530 S.W.2d 794 (tex.1975). the Rourke case held that an employer’s knowledge of the defect in a product would not discharge the supplier’s duty to warn the injured employee. However, that, case did not hold that the assumption of risk defense would be unavailable to the supplier if the injured employee had been warned. The injured person was warned of the risk, but was held not to have assumed that risk, in Messick v. General Motors Corp., 460 F.2d 485 (5th Cir. 1972). However, that person’s “knowledge” of . the risk was undisputed and the holding was based upon a finding that the voluntary encounter of the known and appreciated risk was “reasonable.” This insertion of an “unreasonability” element into the assumption of risk doctrine was expressly disapproved in Henderson v. Ford Motor Co., 519 S.W.2d 87, 91 (Tex. 1974).

Whether an injured person actually knew of the danger is peculiarly within the province of the jury. Hillman-Kelley v. Pittman, 489 S.W.2d 689, 692 (Tex.Civ.App. — El Paso 1972, n. w. h.). Here, there was some evidence from which the jury could have found that Decedent “knew” of the danger, to-wit: the fact that he had been told of the effect of hitting the pullout cable. Although the jury could also have found that Decedent did not know of the danger because he did not hear, understand or remember the warning, we are not able to'j say, as a matter of law, that he did not I know of that danger. s

Plaintiffs argue that even if Decedent had knowledge of some danger, there is no evidence that he knew of the specific defect involved. Knowledge of the general hazard involved in operating a punch-press machine will not support the assumption of risk defense. Rhoads v. Service Machine Go., 329 F.Supp. 367 (E.D.Ark.1971). The general hazard in the instant case was working beneath the raised bed of the dump truck. Vernon Grant and Heil Company’s engineer both concluded that the bed descended because the pullout cable was tripped. This evidence indicates that the specific danger was that striking the pullout cable would cause the bed to descend. The jury, upon consideration of Vernon Grant’s testimony, could have found that Decedent knew of this specific hazard. Plaintiffs also contend that the requisite knowledge must be of a “defect” and that “knowledge that a phenomenon will occur in a product ... is not knowledge that the product is dangerously defective.” Plaintiffs rely upon the use of the word, “defect,” in Henderson v. Ford Motor Co., supra, 519 S.W.2d at 89. It is clear, how- ^ ever, that the assumption of risk defense is premised upon knowledge of the dangerous condition of a product rather than recognition of its defectiveness. See: Henderson at 91; Hillman-Kelley v. Pittman, supra, 489 S.W.2d at 693, and J. & W. Corporation v. Ball, 414 S.W.2d 143, 146 (Tex.1967).

Plaintiffs argue that even if Decedent knew of the danger of the pullout cable, there is no evidence that he knew of the other dangerous defects, to-wit: the defectively designed control valve; the failure to supply a support brace; and the failure to instruct as to proper bracing procedures. These defects may well have been producing or proximate causes of the death in that (1) but for the defects, the death might not have occurred, and (2) the death was a foreseeable result of the defects. East Texas Theatres, Inc. v. Rutledge, 453 S.W.2d 466, 468 (Tex.1970). In our opinion, however, all of the above producing causes were part of the same danger. The assumption of risk defense is based upon the injured person’s awareness of the danger of injury rather than an awareness of the producing causes of the injury. Since there was some evidence that Decedent knew of the specific danger in hitting the pullout cable, plaintiffs’ argument is without merit.

The danger encountered must be both known and appreciated to raise the assumption of risk defense. Ellis v. Moore, supra. Again, the test is subjective. Massman-Johnson v. Gundolf, supra. We look for some evidence that Decedent actually appreciated the risk or was in possession of facts from which he would be legally charged with appreciation of the danger. Halepeska v. Callihan Interests, Inc., supra, 371 S.W.2d at 379. If by reason of age, or lack of information, experience, intelligence or judgment, Decedent did not understand the risk involved, he will not be taken to have assumed that risk. Restatement (Second) of Torts, Section 496D, comment c.

Decedent was approximately 53 years old at the time of the accident. His formal education had stopped at the 5th or 6th grade but he had been to a trade or mechanical school. He had been a sergeant in the army. Decedent had previously made a living by building airplanes, moving houses and doing construction work. He had not previously worked upon Vernon Grant’s dump truck.

Plaintiffs argue that Decedent, after hearing Vernon Grant’s warning, might have thought that the bed would descend only until the cable was released. Plaintiffs’ expert testified that a construction laborer who had not previously owned or operated a dump truck probably would not appreciate the hazard from looking at the hoist mechanism. Heil Company’s engineer testified that he had been involved in the hoist industry for 4 years before he became completely aware that a dump bed would descend when the pullout cable was struck.

There is some evidence that Decedent might not have appreciated the danger of hitting the pullout cable. However, by reason of Decedent’s information, age and experience, we conclude that there was some evidence of probative force that he did appreciate that danger. Thus, an issue for the jury exists.

Plaintiffs’ final point in support of their contention of no evidence of the necessary elements of the assumption of risk defense is that Decedent’s encounter of the risk was not shown to have been voluntary. A voluntary encounter means by free and intelligent choice. Henderson v. Ford Motor Co., supra.

Plaintiffs argue as follows: that there was no evidence that Decedent did not forget the warning; that there was no evidence that the tripping of the pullout cable was not accidental; that Decedent chose to encounter the risk in the face of unreasonable alternatives; or that Decedent was exercising a legal right when he encountered the danger. We have thoroughly considered each of these arguments and find them to be without' merit. We conclude that there was some evidence that would support a jury finding that Decedent’s encounter with the risk was by free and intelligent choice.

Plaintiffs’ second contention under their Reply Point I is that any error in excluding the testimony of Vernon Grant which related to assumption of risk was harmless because that defense is inapplicable when strict liability is based upon a failure to warn of a dangerous condition. Plaintiffs rely upon statements to the effect that when there is a breach of the duty no assumption of the to warn, there is risk. See: McGlanahan v. California-Spray Chemical Corp., 194 Va. 842, 75 S.E.2d 712, 725 (1953); Wright v. Carter Products, Inc., 244 F.2d 53, 60 (2d Cir. 1957); R. Keeton, Assumption of Risk in Products Liability Cases, 22 La.L.Rev. 122, 145 (1961). These statements were made in situations in which no warning had been given to the injured person. The function of the warning is to give that person knowledge and an opportunity to appreciate the danger. Ellis v. Moore, supra, 401 S.W.2d at 793. The supplier of a defective product is usually in the best position to supply this warning but there is no reason why the warning cannot come from another source. “One who voluntarily chooses to use a chattel with a complete realization, regardless of how it was acquired, of the risks to which he thus exposes himself voluntarily assumes such risks . . . ” 1 Hursh & Bailey, American Law of Products Liability 2d, sec. 2:107 (Emphasis added.) The issue of assumption^ of risk was held to have been properly submitted, even though the jury found that the supplier of a defective product had failed to warn the injured user of the danger, in Hillman-Kelley v. Pittman, supra, 489 S.W.2d at 692. We hold that since Vernon Grant may have warned Decedent of the danger, the jury’s finding of Heil Company’s failure to do so did not render the assumption of risk defense inapplicable.J

Plaintiffs’ final argument under Reply Point I is that any error in excluding evidence of assumption of risk was harmless because that defense is inapplicable when strict liability is based upon the defective design of a product being used in a manner reasonably foreseeable to the supplier. Plaintiffs argue that the supplier is in the best position to discover a design defect and should not be permitted to avoid liability on the ground that the injured person made a foolish judgment to encounter the danger. The thrust of this argument is that assumption of risk should not be applicable in any case when strict liability is based upon the defective design of a product. The defense of assumption of risk was held available in such a case in Rourke v. Garza, supra, 530 S.W.2d 794. Plaintiffs’ contention is overruled.

MISUSE

The Heil Company contends that it was a misuse of the truck to work between the bed and the chassis while the bed was in a raised position and was not blocked. Appel-lees’ Reply Point II is that, even considering the excluded portions of Vernon Grant’s testimony, there was no evidence of misuse and, therefore, no harmful error in excluding those portions of his testimony relating thereto.

Suppliers of products are not liable for injuries resulting from the abnormal use of that product. Restatement (Second) of Torts, Section 402A, comment h. The misuse defense has been adopted in Texas. See Rourke v. Garza, supra, 530 S.W.2d 794. A product is not “misused” merely because the supplier intended that it be used in a different manner; the supplier must show that the use which caused the injury was not reasonably foreseeable. Otis Elevator Co. v. Wood, 436 S.W.2d 324, 329 (Tex.1968). The Heil Company’s recognition of the inapplicability of the “intended use” standard is apparent from its request for a Special Instruction that “. the term ‘misuse’ means a use which was not reasonably expected by or reasonably foreseeable to the Defendant Heil Company.”

Plaintiffs contend that the misuse defense was negated by evidence which showed that the Heil Company could and did foresee Decedent’s use of the truck. This contention misconceives the scope of our review of a “no evidence” point since we must ignore such evidence. However, we are unable to find any evidence of probative force indicating that working beneath the raised bed without bracing it was an unforeseeable use. Vernon Grant’s testimony, in the light most favorable to the establishment of the misuse defense, merely showed that he considered that to be a dangerous and abnormal use. Abnormal uses are not necessarily unforeseeable. Vernon Grant’s testimony that he would normally brace the raised bed before working beneath it was not evidence that such a use was not reasonably foreseeable. We conclude that any error in excluding this portion of his testimony was harmless under Tex.R.Civ.P. 434; we now determine the propriety of the exclusion of that testimony which could have established the assumption of risk defense.

THE DEAD MAN’s STATUTE

Heil Company contends that the Dead Man’s Statute was inapplicable because Plaintiffs sought recovery only in their own right and therefore judgment was not rendered for or against them as the heirs or legal representative of Decedent. The argument is that the pleadings for compensation for the loss of support and guidance by Decedent, for mental anguish and for exemplary damages set up a cause of action under the Wrongful Death Act but did not set up a cause of action under the Survival Statute.

The Wrongful Death Act permits recovery by a decedent’s surviving spouse, children and parents for losses they sustained by reason of the death. Norman v. Valley Gin Co., 99 S.W.2d 1065, 1067 (Tex.Civ.App. — Beaumont 1936, writ ref’d). The Survival Statute permits recovery for damages sustained by the decedent. Lan-ders v. B. F. Goodrich Co., 369 S.W.2d 33, 35 (Tex.1963). This statute is so named because it provides that causes of action for injuries resulting in death shall not abate by reason of the death but shall survive to the heirs and legal representatives of the decedent’s estate. The Dead Man’s Statute has been held inapplicable in actions brought under the Wrongful Death Act rather than for rights inherited from the decedent. See Canales v. Bank of California, 316 S.W.2d 314, 318-319 (Tex.Civ.App. —Eastland 1958, writ ref’d n.r.e.); Wallace v. Stevens, 74 Tex. 559, 12 S.W. 283 (1889).

Plaintiffs respond that the Dead Man’s Statute was applicable because, in seeking exemplary damages, they acted as the heirs and legal representative of Decedent. Plaintiffs argue that Decedent’s children obtained their capacity to invoke the Dead Man’s Statute by suing for exemplary damages under the Texas Constitution and that Decedent’s widow obtained that capacity under the Survival Statute by seeking exemplary damages.

Plaintiffs point out that their claim for exemplary damages was in no way dependent upon the provision therefor in the Wrongful Death Act but was based ultimately upon the Constitution. “Every person, corporation, or company, that may commit a homicide, through willful act, or omission, or gross neglect, shall be responsible, in exemplary damages, to the surviving husband, widow, heirs of his or her body . .” Tex.Const, art. XVI section 26 (emphasis added). Recoveries of exemplary damages in wrongful death cases are limited to that class of people set forth in the constitutional provision. Scoggins v. Southwestern Electric Service Co., 434 S.W.2d 376, 380 (Tex.Civ.App.—Tyler 1968, writ ref d n.r.e.). Plaintiffs conclude that judgment for the recovery of exemplary damages was necessarily rendered for the children as heirs. The application of the Dead Man’s Statute, however, depends upon whether Decedent’s children recovered these damages in their own right or inherited that right from Decedent. Wallace v. Stevens, supra. The fact that a decedent’s heirs may recover exemplary damages does not establish this right as one belonging to and inherited from the decedent. Although the derivation of the right to recover exemplary damages for wrongful death was not discussed, a widow and her children did not invoke the Dead Man’s Statute when suing for such damages in Wallace v. Stevens, supra.

Plaintiffs urge that Decedent’s widow prosecuted her claim for exemplary damages as his legal representative under the Survival Statute. Their contention that the cause of action for exemplary damages belonged to Decedent himself relies upon Houston-American Life Insurance Co. v. Tate, 358 S.W.2d 645, 649 (Tex.Civ.App.— Waco 1962, n.w.h.). In that case, however, the exemplary damages were based on unreasonable collection efforts and the court held that the Legislature had not excluded such a cause of action from the Survival Statute. The recovery of exemplary damages for wrongful death by the surviving spouse and heirs has been expressly provided for in Tex.Const. art. XVI section 26 and Tex.Rev.Civ.Stat.Ann. art. 4673. The inclusion of such a cause of action in the Wrongful Death Act indicates that it is one belonging to the statutory beneficiaries. Moreover, the Legislature would be without authority to expand the class of people entitled to recover exemplary damages for wrongful death to include the decedent’s legal representative. Scoggins v. Southwestern Electric Service Co., supra. We conclude that the claim for exemplary damages by plaintiffs did not invoke the Dead Man’s Statute.

Plaintiffs next argue that they sought recovery for Decedent’s conscious pain and suffering, a cause of action under the Survival Statute, and thereby invoked the Dead Man’s Statute. Plaintiffs admit that they did not plead this cause of action but contend that the Heil Company waived this pleading defect by failing to object to the introduction of testimony raising this issue. The testimony in question was that of Decedent’s widow and two of his children. Mrs. Grant testified that she could hear Decedent breathing heavily when she ran to the dump truck. James Grant, Jr., and Jerry Grant testified as to Decedent’s movements and expressions observed by them when he was pinned beneath the dump bed. This testimony, however, was offered for the purpose of showing the mental anguish of the witnesses rather than Decedent’s pain and suffering. This purpose is indicated by the subsequent testimony of these witnesses about hysteria and upsetting mental pictures of the accident. Contrary to plaintiffs’ contention, Heil Company did object to testimony about Decedent’s pain on the ground that the suit had been brought under the Wrongful Death Act and not on behalf of the estate for Decedent’s pain. That objection was overruled when Plaintiffs responded that the testimony related to the state of mind of the witness. We are of the opinion that plaintiffs did not seek recovery for Decedent’s pain.

Plaintiffs contend that even if they did not advance a cause of action as the heirs and legal representative of Decedent, the Dead Man’s Statute was still applicable. They argue that the judgment which was rendered bars their future ability to sue Heil Company as heirs and legal representative and, therefore, was rendered against them as such.

The judgment in a wrongful death action does not necessarily bar a subsequent suit on behalf of the estate. Landers v. B. F. Goodrich Go., supra. In light of our decision to reverse and remand this case for a new trial, plaintiffs clearly are not barred from asserting any applicable cause of action previously omitted.

Plaintiffs’ final argument for the applicability of the Dead Man’s Statute is premised on the assumption that this action was prosecuted in a dual capacity; i. e., that plaintiffs could invoke the Dead Man’s Statute in one capacity while in the other capacity, they could not. We are unable to discover any capacity in which judgment was rendered'for or against plaintiffs as the legal representative or heirs of Decedent. We conclude that the trial court erred in excluding portions of Vernon Grant’s testimony under the Dead Man’s Statute.

The trial court’s judgment in favor of Decedent’s widow and children is reversed and that cause is remanded for a new trial. With one exception, Heil Company’s remaining points of error relating to this portion of the judgment have either been waived at oral argument or made moot by this decision. The Heil Company’s contention that exemplary damages are not recoverable in a strict products liability suit for wrongful death should be answered to guide the trial court in the event of another trial of this cause.

Exemplary damages may be recovered for a wrongful death resulting from a willful act or omission or gross negligence. Tex.Const. art. XVI section 26. These damages have been allowed in products liability actions in other jurisdictions. See: Moore v. Jewel Tea Co., 116 Ill.App.2d 109, 253 N.E.2d 636 (1969) aff’d 46 I11.2d 288, 263 N.E.2d 103 (1970); Drake v. Wham-0 Manufacturing Co., 373 F.Supp. 608 (E.D.Wis. 1974). In the latter case, the court held that exemplary damages were available in a products liability action for the death of the user; the court noted that Wisconsin law ties the availability of punitive damages to the facts proved rather than the formal theory of recovery alleged. Drake v. Wham-0 Manufacturing Co., supra, at 611. Exemplary damages were not allowed in the products liability suit of Kritser v. Beech Aircraft Corp., 479 F.2d 1089 (5th Cir.1973). However, the court indicated that such damages would have been available under the Texas Constitution if the elements of Article XVI, section 26 had existed. Kritser v. Beech Aircraft Corp., supra, at 1091, 1097. We believe that exemplary damages may be recovered under that provision of the Texas Constitution in a strict liability action for the death of the user of a defective product.

The trial court instructed a verdict in favor of Vernon Grant on Heil Company’s claim against him for contribution and/or indemnity. Heil Company contends that there was some evidence of probative force that Vernon Grant breached a duty of care to Decedent by permitting him to work beneath the raised bed without a brace.

Even if Vernon Grant were negligent towards Decedent, Heil Company could not recover contribution and/or indemnity from its co-tortfeasor. The test of whether the loss should be shifted from one tortfeasor to another is to consider the one as a plaintiff suing the other in tort; Then, determine whether such one as plaintiff, although guilty of a wrong against a third person, is nonetheless entitled to recover against his co-tortfeasor. Gulf, C. & S.F. Ry. v. Bliss, 368 S.W.2d 594, 596 (Tex.1963); Austin Road Co. v. Pope, 147 Tex. 430, 216 S.W.2d 563, 565 (1949). Vernon Grant’s duty ran to Decedent and not to the Heil Company. The trial court properly in-

strueted a verdict in his favor and that portion of the judgment is affirmed. Affirmed in part and reversed and remanded in part.

ON MOTION FOR REHEARING

The Heil Company, in its Motion for Partial Rehearing, complains of this court’s af-firmance of the verdict instructed in favor of Vernon Grant. The Heil Company asserts error in the holding that it could not recover contribution from Vernon Grant even if he were negligent towards Decedent. We have reviewed the law regarding contribution and indemnity and remain convinced of the correctness of our judgment.

Article 2212, Tex.Rev.Civ.Stat. Ann., permits enforced contribution among joint tortfeasors who are in pari delicto, but does not abrogate the common law rule as to the rights of wrongdoers who are not in pari delicto. Austin Road Co. v. Pope, supra. When joint tortfeasors are not equally guilty, although both are liable to a third person, as between themselves the blameless should be allowed indemnity. Austin Road Co. v. Pope, supra. Joint tortfeasors are not in pari delicto when the injury resulted from a violation of the duty one owes the other. Austin Road Co. v. Pope, supra.

Even if Vernon Grant were negligent in permitting Decedent to work beneath the raised bed without a brace, the death resulted, at least in part, from the defective design of the hoist mechanism. This defective design constituted a breach of the Heil Company’s duty to both Vernon Grant and Decedent. Thus, as between the joint tort-feasors, Vernon Grant would have been entitled to indemnity from the Heil Company and would not have been liable to the Heil Company for contribution.

The Motion is respectfully overruled.

      . In determining this contention, we must review the evidence in the light most favorable to that issue. Rourke v. Garza, 530 S.W.2d 794 (Tex. 1975); Calvert, “No Evidence” and “Insufficient Evidence” Points of Error, 38 Texas L.Rev. 361, 364 (1960).

      . In determining this contention, we must review the evidence in the light most favorable to the issue of misuse. Rourke v. Garza, supra, 530 S.W.2d 794; Calvert, ‘‘No Evidence” and ‘‘Insufficient Evidence” Points of Error, 38 Texas L.Rev. 361, 364 (1960).

      . Tex.Rev.Civ.Stat.Ann. art. 3716
      “In actions by or against executors, administrators, or guardians, in which judgment may be rendered for or against them as such, neither party shall be allowed to testify against the others as to any transaction with, or statement by, the testator, intestate or ward, unless called to testify thereto by the opposite party; and the provisions of this article shall extend to and include all actions by or against the heirs or legal representatives of a decedent arising out of any transaction with such decedent.”

      . Tex.Rev.Civ.Stat.Ann. arts. 4671 — 4678.

      . Tex.Rev.Civ.Stat.Ann. art. 5525.