author: DODSON, Justice.

text:
    Helen FISHER, Appellant, v. FIRST NATIONAL BANK OF MEMPHIS, Texas, Appellee.
    No. 8970.
    Court of Civil Appeals of Texas, Amarillo.
    June 28, 1979.

      Sanders, Saunders, Brian, Finney & Thomas, Michael Lynch, Amarillo, for appellant.
    Gibson, Ochsner & Adkins, W. P. Sturdi-vant, Amarillo, for appellee.
   DODSON, Justice.

The First National Bank of Memphis, Texas, instituted suit against Jimmy Roden to recover on a promissory note and to foreclose its alleged security lien against the proceeds from an agreed sale of cattle. The Bank joined Helen Fisher, who claimed ownership of 158 head of the cattle involved in the agreed sale, and others claiming an interest in the alleged collateral as parties defendant. Mrs. Fisher filed a cross-action to recover the prpceeds from the sale of cattle which she claimed. The Bank moved for summary judgment to foreclose its alleged lien on the proceeds from the cattle claimed by Mrs. Fisher. After a hearing, the trial court granted summary judgment for the Bank and severed the cause from the remaining actions against Mr. Roden and others. Mrs. Fisher appeals. Affirmed.

I.

Mrs. Fisher purchased the 158 head of cattle in question from Mr. Roden in August 1976. She maintains that the trial court erred in granting the summary judgment because Mr. Roden had no title or interest in the 158 head of cattle to which the Bank’s lien could attach. Therefore, she argues that she is entitled to the proceeds from the agreed sale of the cattle. We disagree.

Section 9.203 of the Texas Business and Commerce Code (Vernon Supp. 1978-1979), in part, provides:

(a) . . .a security interest is not enforceable against the debtor or third parties with respect to the collateral and does not attach unless
(1) . . . the debtor has signed a security agreement which contains a description of the collateral . . .; and
(2) value has been given; and
(3) the debtor has rights in the collateral.
(b) A security interest attaches when it becomes enforceable against the debtor with respect to the collateral. Attachment occurs as soon as all of the events specified in Subsection (a) have taken place unless explicit agreement postpones the time of attaching.

The summary judgment proof conclusively establishes each of the elements necessary for attachment to occur.

On October 16,1975, Mr. Roden executed a promissory note to the Bank for $350,000 together with a security agreement granting the Bank an interest in the following collateral: “202 Bulls and Steers w/left ear Tag; branded JR on left shoulder; Located in J. Roden feedlot East of Memphis,” and “[a]ll substitutes and replacements for, accessions, attachments, and other additions to . the above property” and “[a]ll property similar to the above hereafter acquired by debtor.”

On October 21, 1975, a finance statement naming Jimmy Roden as debtor and First National Bank of Memphis, Texas, as the secured party was filed with the County Clerk of Hall County, Texas. The statement covered all livestock belonging to Ro-den and located in Hall County, Texas, or wherever located.

On December 15, 1975, Mr. Roden executed another security agreement for the $350,000 indebtedness. The agreement gave the Bank a security interest in “1,207 Mixed Steers To be Branded JR on the left shoulder; Yellow Tag with name and No. in left ear; Located on debtor’s own farm 3 miles East of Memphis in Hall County, Texas.” The agreement also contained the same after-acquired property provisions set forth in the October 16, 1975, security agreement.

In August 1976 Mr. Roden purchased the 158 head of cattle in question from Mr. Hatcher. The cattle were tagged in the ear, branded, and placed in Mr. Roden’s feedlot in Hall County, Texas. Roden gave Hatcher a check as payment for the cattle. Mr. Roden subsequently sold the cattle to Mrs. Fisher and drafted her account for $11,600. The cattle, however, remained in Roden’s possession where he continued to pasture, feed, and care for the cattle pursuant to a profit-sharing arrangement with Mrs. Fisher.

Mrs. Fisher, by deposition, testified concerning the purchase of the 158 head of cattle from Mr. Roden. The testimony follows:

Q Now then, in August of 1976, you purchased additional cattle from Mr. Roden, did you not?
A Yes.
Q Would you please tell me how many head?
A 158.
Q By telephone?
A Yes.
Q Did he call you, or did you call him?
A He called me. He — if this is relevant, I don’t know, he said he had bought the cattle, and a young man, whose name he didn’t give me, had bought them from him at a profit, but the young man couldn’t get his money right then from the FHA. And he said if I would buy the cattle, they already had a profit in them, and he couldn’t carry them. He didn’t have the money to carry them. So would I buy them and then I could have the sale of them, and it was more of an accommodation than anything.
Q Who did he tell you he had bought them from?
A He didn’t. He just said they were Southern cattle.
Q Who did he tell you he had sold them to?
A He didn’t give me the man’s name, but it was young man there.
Q Sold them to some young man there?
A Indeed, I don’t remember, because it was only going to be two weeks.
Q In other words, he had sold them to this young man, and this young man couldn’t come up with the money?
A He was getting it from the FHA, but he didn’t have his papers clear,, and rather for the whole deal to fall through, Mr. Roden asked me if I would pay for the cattle, and then I would have the sale of them.
Q And pay Mr. Roden?
A Yes.
Q Is that correct?
A Yes.
MR. SAUNDERS: And what?
MR. STURDIVANT: And pay Mr. Ro-den.
. A Yeah, he had paid for the cattle, but he didn’t have the money to cover it in some such way. And more an accommodation than anything else, I agreed to do that for two weeks.
Q Did you tell him to dráw a Customer’s Draft on you?
A Yes, he needed the money right then.

Thus, Mrs. Fisher admits that Roden initially purchased and paid for the 158 head of cattle, yet maintains that Roden had no rights in the collateral to which the Bank’s security interest could attach.

In the case of In re Samuels & Company, Inc., 526 F.2d 1238 (5th Cir.) cert. denied, 429 U.S. 834, 97 S.Ct. 98, 50 L.Ed.2d 99 (1976), the court, construing § 9.204(a) of the Code, held that a defaulting buyer of cattle acquired rights in them sufficient for a security interest to attach under an after-acquired property clause in a security agreement, even though the cattle were purchased with a check that was dishonored. In its thorough analysis, the court recognized that the debtor’s interest upon delivery of the cattle was defined under the Code and that however “slight or tenuous or marginal” the interest, it was “necessarily great enough to permit attachment of the lien.”

In the case at'bar, Roden purchased the cattle in question with a check, the disposition of which is not shown, took possession of the cattle, and placed them in his feedlot. When this occurred, Mr. Roden’s interest in the cattle was defined under the Code. Thus, Mr. Roden had rights in the collateral, i. e., the 158 head of cattle, to which the security interest could attach under the agreement executed in conjunction with the $350,000 promissory note.

II.

The summary judgment proof conclusively established that Mr. Roden was a farmer at all times pertinent to this case. This point is unchallenged. Thus, when the Bank’s lien attached to the 158 head of cattle, it continued in the collateral notwithstanding the sale from Mr. Roden to Mrs. Fisher, unless the sale was authorized by the Bank in the security agreement or otherwise. See Tex.Bus. & Com.Code Ann. §§ 9.306(b), 9.307(a) (Vernon Supp. 1978-1979).

The security agreement provides that the debtor will not sell, lease, or otherwise transfer the collateral without the Bank’s consent. Mrs. Fisher contends, however, that although the security agreement did not authorize the sale in question, the Bank has nevertheless impliedly waived its lien on the 158 head of cattle by a prior course of conduct in which it permitted Roden to sell other cattle subject to the lien without requiring its prior consent.

In support of her position, Mrs. Fisher relies on Clovis National Bank v. Thomas, 77 N.M. 554, 425 P.2d 726 (1967). In Thomas, the New Mexico Supreme Court determined that Clovis National Bank waived its lien in certain collateral by consenting to and acquiescing in the sale of collateral without requiring the debtor to obtain prior consent as required by the security agreement. This decision was made notwithstanding § 50A-1—205(4), N.M.S.A.1953, which provided:

(4)The express terms of an agreement and an applicable course of dealing or usage of trade shall be construed wherever reasonable as consistent with each other; but when such construction is unreasonable express terms control both course of dealing and usage of trade and course of dealing controls usage of trade.

This provision is identical to Tex.Bus. & Com.Code Ann. § 1.205(d) (Vernon 1968).

The Bank responds that Mrs. Fisher’s contention is contrary to § 1.205(d) of the Code and advances the case of Wabasso State Bank v. Caldwell Packing Co., 308 Minn. 349, 251 N.W.2d 321 (1976), in support of such an interpretation. In Wabasso State Bank the Minnesota Supreme Court determined that the bank did not waive its lien and impliedly authorize the sale of the collateral in question by virtue of a prior course of conduct whereby the bank failed to require its debtor to obtain permission to sell the collateral, as required by the security agreement. In so determining, the court stated:

‘As we have pointed out the mere failure to rebuke the seller, the reasonable acceptance of the proceeds of the sale when actually delivered to apply upon the debt, are not acts which indicate intention to waive a security interest, but in the event such unreasonable act is inconsistent and contradictory of the express agreement, then the express terms control both the course of dealing and the usage of trade between the parties. The action of the lender and the debtor and their course of dealings between themselves is reasonable and is consistent with the underlying policy of the code and the provision prohibiting waiver of the security interest unless expressed in writing.’

Wabasso State Bank v. Caldwell Packing Co., supra, at 324-25, quoting Garden City Production Credit Ass’n v. Lannan, 186 Neb. 668, 186 N.W.2d 99, 103 (1971). See also Baker Production Credit Ass’n v. Long Creek Meat Co., Inc., 266 Or. 643, 513 P.2d 1129 (1973); Vermilion County Production Credit Ass’n v. Izzard, 111 Ill.App.2d 190, 249 N.E.2d 352 (1969); Colorado Bank & Trust Co. v. Western Slope Investments, Inc., 539 P.2d 501 (Colo.App.1975).

We are of the opinion, in light of the specific enactment by our legislature of § 1.205(d) and the provisions giving the financing of farm products preferred treatment, that the reasoning of Wabasso State Bank effectuates this legislative policy. We further note that the New Mexico Legislature, by enactment of N.Mex.Stat.Ann. 50A — 1—205(3), (4) (1975), set aside the Thomas rule. Under these circumstances, we respectfully decline the invitation to follow Clovis National Bank v. Thomas, supra.

We are also persuaded that Mrs. Fisher failed to establish a genuine question of fact on all of the essential elements of her affirmative defense of waiver. Where a plaintiff moves for summary judgment in an action in which defendant has pleaded an affirmative defense, the plaintiff is entitled to the summary judgment if he demonstrates by evidence that there is no material factual issue upon the elements of his claim and defendant fails to come forward with a showing that there is a disputed fact issue upon the affirmative defense. Gulf, Colorado & Santa Fe Railway Co. v. McBride, 159 Tex. 442, 322 S.W.2d 492, 500 (1958).

Waiver is commonly defined as the intentional release, relinquishment, or surrender of a known right. Ford v. Culbertson, 158 Tex. 124, 308 S.W.2d 855, 865 (1958). In Nixon Construction Co. v. Downs, 441 S.W.2d 284, 286 (Tex.Civ.App.— Houston [1st Dist.] 1969, no writ), the court stated:

‘A waiver, involving as it does the idea of intention, may be express or implied. Waiver may be shown by such conduct as will warrant the inference of the relinquishment of a known right. But waiver by implication will be applied only to prevent fraud or inequitable consequences. To establish an implied waiver of a legal right, there must be a clear, unequivocal, and decisive act of the party showing such a purpose or acts amounting to an estoppel on his part.. In the absence of an express renunciation a waiver will not be presumed or implied contrary to the intention of the party whose rights would be injuriously affected thereby, unless by his conduct the opposite party has been misled to his prejudice into the honest belief that such waiver was intended or consented to ’ (emphasis ours). 60 Tex.Jur.2d 191 — 192, Waiver, §9.

In essence, conduct which misleads no one does not constitute a waiver. See Hines v. Jordan, 228 S.W. 633, 634 (Tex.Civ.App.— Texarkana 1921, writ ref’d).

The summary judgment proof fails to demonstrate that Mrs. Fisher was prejudi-cially misled by the Bank’s conduct into believing that the Bank intended to waive its lien on the cattle in question. The proof also fails to show whether the Bank had actual or constructive knowledge of the transaction between Mr. Roden and Mrs. Fisher. Nor does the proof show whether Mrs. Fisher had knowledge of, or made any inquiry concerning, the existence of the Bank’s lien on the cattle in question, although it was shown that Mrs. Fisher was a person experienced in cattle buying and their financing.

Mrs. Fisher contends that the most persuasive proof of waiver is the following testimony of Mr. Haulby Dean, vice president of the Bank:

Q You did not claim a lien on those ins and outs, turn arounds?
A No, no quick turn arounds.
Q Would that be true with any operation where he [Jimmy Roden] might take delivery and might sell them in a matter of days, without putting them out on the place?
A I think these particular cattle in question, I don’t think the bank paid for those cattle.

This testimony refers to quick turn around sales of cattle whereby Roden bought cattle at auctions and sold them without bringing them to his feeding and grazing operation. In the case at bar, the 158 head of cattle were purchased from Hatcher in August 1976, delivered to Ro-den’s feedlot, sold to Mrs. Fisher, and remained in Roden’s possession until shortly before this action commenced. There is no evidence of probative force which would support the contention that the transaction in question was a quick turn around not intended to be covered under the security agreement.

We conclude that the summary judgment proof conclusively establishes that Roden defaulted on a promissory note to the Bank; that the note was secured by an agreement for value in which a security interest was created in named collateral and after-acquired collateral of a similar nature; that Roden had rights in the collateral, i. e., 158 head of cattle, to which the security agreement attached; and that the Bank was entitled to the proceeds from the agreed sale of the cattle by virtue of its security interest. The proof fails to raise a genuine issue of fact on all of the essential elements of Mrs. Fisher’s affirmative defense of waiver. Therefore, the Bank was entitled to summary judgment. See Gulf, Colorado & Santa Fe Railway Co. v. McBride, supra.

III.

In her final point of error, Mrs. Fisher contends that the trial court erred in severing this cause of action from the Bank’s cause of action against Mr. Roden and others claiming an interest in the collateral. We disagree.

A trial court is vested with broad discretion in determining whether to sever a cause of action. The trial court’s action in this regard will not be disturbed upon appeal unless it has abused its discretion. Tex.R.Civ.P. 41; Womack v. Berry, 156 Tex. 44, 291 S.W.2d 677, 682 (1956); Sheppard v. Citizens National Bank of Austin, 567 S.W.2d 613, 615 (Tex.Civ.App. — Austin 1978, writ ref’d n.r.e.). In Marshall v. Garcia, 514 S.W.2d 513, 517 (Tex.Civ.App.— Corpus Christi 1974, writ ref’d n.r.e.), the court said:

Rule 166-A, Subsection (d) clearly authorizes the trial court to grant summary judgment as to parties or issues not in controversy. The trial court should, if possible, enter a severance of that phase of the case. A summary judgment which does not dispose of all parties and all issues in a pending suit is interlocutory in nature. .

The trial court’s judgment severing this cause of action inures to the benefit of Mrs. Fisher. Under the circumstances, we conclude that the court did not abuse its discretion in granting the severance.

In summary, Mrs. Fisher’s points of error are overruled. Accordingly, the judgment of the trial court is affirmed.

COUNTISS, J., not participating.

      . By agreement of the parties, 135 of the 158 head of cattle were sold for $25,723.91, which was placed in a trust account. The fate of the remaining 23 head of cattle is unexplained.

      . This section provided:
      (a) A security interest cannot attach until there is agreement (Subdivision (3) of Section 1.201) that it attach and value is given and the debtor has rights in the collateral. It attaches as soon as all of the events in the preceding sentence have taken place unless explicit agreement postpones the time of attaching.
      Tex.Bus. & Com.Code Ann. § 9.204(a) (Vernon 1968).

      . In this case, the court said: “ ‘Waiver’ is an intentional abandonment of a known right. ‘There can be no waiver unless so intended by one party and so understood by the other party, or one party has so acted as to mislead the other and is estopped thereby.’ ”


source: Caselaw Access Project

author: CLAYTON, Justice.

license: Public Domain

text:
    Selena R. MAHATHY, a minor, et al., Appellants, v. GEORGE L. INGRAM AND ASSOCIATES, Appellee.
    No. 8322.
    Court of Civil Appeals of Texas, Beaumont.
    June 28, 1979.
    March H. Coffield, Jasper, for appellants.
    Thomas G. King, Beaumont, for appellee.
   CLAYTON, Justice.

This is a personal injury action brought by appellants, Selena Rechell Mahathy, a minor, suing by and through her mother, Hellen Gillis as next friend, and by the mother in her individual capacity, against George L. Ingram and Associates, appellee herein. The suit is based upon injuries received by the minor on May 5,1978, when she was 15 years of age, and a student at the Middle School in Jasper, Texas. Her injuries were sustained when she attempted to go through a door of the school building and cut her arm on glass that formed a portion of the door. Appellants alleged various acts of negligence in the design of the door and breach of implied warranties.

Appellee filed a motion for summary judgment, based upon the limitation provisions of Tex.Rev.Civ.Stat.Ann. art. 5536a (Vernon Supp.1978), asserting the applicability of that 10-year statute of limitations. Following appellants’ reply to such motion, an order was entered by the trial court severing appellants’ cause of action against the general contractor on this school project. Summary judgment was rendered for appellee, from which judgment appellants have appealed.

Appellants, in their sole point of error, contend that Tex.Rev.Civ.Stat.Ann. art. 5536a (Vernon Supp.1978) does not bar their cause of action for the reason that the minor appellant is and was, at all material times, under a disability as a minor and that the tolling provisions of Tex.Rev.Civ. Stat.Ann. art. 5585 (Vernon1958) is controlling, and, therefore, as a matter of law, their cause of action is not barred by the 10-year limitations as provided in Article 5586a.

It is undisputed that appellee, Ingram, was and is a Registered Architect within the State of Texas, and, as such, designed the school building in question and was responsible for planning and inspecting the construction of improvements, equipment, and structures in connection with such building. The school building had been completed on or about October 13, 1964, more than thirteen years prior to the date of the injuries made the basis of this suit.

Briefly stated, Section 1 of Article 5536a provides that all actions or suits for damages or injuries sustained by any individual arising out of a defective or unsafe condition of any real property shall be commenced and prosecuted within ten years from the “substantial completion” of any improvements to such real property. This section of the statute applies to registered or licensed engineers or architects who performed or furnished the design, planning, inspection, or construction of such improvements to real property. This section of Article 5586a became effective on September 1,1969. Section 2 of such Act, effective September 1, 1975, enumerates certain provisions which could extend the limitation period beyond the tenth year from the date of substantial compliance, none of which are applicable to the case at bar.

Appellants contend that the 10-year limitation stated in Article 5536a is tolled during the minority of the minor under the express provisions of Article 5535. This contention has been answered adversely to appellants in Hill v. Forrest & Cotton, Inc., 555 S.W.2d 145 (Tex.Civ.App. — Eastland 1977, writ ref’d n.r.e.). The Hill case specifically holds that Article 5536a is constitutional and that it was to be applied retroactively.

In the case at bar, the date the minor appellant’s alleged cause of action accrued against appellee Ingram was on May 5, 1978, the date of her injuries. At the timé the minor’s cause of action accrued the 10-year period of limitations provided for in Article 5536a had already expired. The limitation period could not be tolled because it had already expired and barred any cause of action accruing after the expiration of the 10-year period. At the time of the occurrence of the minor’s injuries, she had no maintainable cause of action against ap-pellee. Hill v. Forrest & Cotton, Inc., supra. The minor appellant having no such cause of action, the mother, as next friend and in her individual capacity, had none. This point is overruled.

There being no error, the judgment of the trial court is affirmed.

AFFIRMED.

DIES, C. J., not participating.


text:
    TEXAS RESOURCES, INC., et al., Appellants, v. DIAMOND SHAMROCK CORPORATION, Appellees.
    No. 8316.
    Court of Civil Appeals of Texas, Beaumont.
    June 28, 1979.

      James W. Christian, Houston, for appellant.
    W. C. McClain, Conroe, for appellees.
   CLAYTON, Justice.

This is an eminent domain proceeding brought by Diamond Shamrock Corp., ap-pellee, against Texas Resources, Inc., and Julian Hawes, appellants (and others who are not parties to this appeal), to condemn an easement for pipeline purposes upon and across certain lands in Montgomery County.

The petition for condemnation was filed by appellee in the County Court of Montgomery County. After the Commissioners were appointed and qualified, they gave notice of the hearing and, on July 24, 1970, made their award which was properly filed on July 27, 1970. On August 10, 1970, appellants filed their objections and exceptions to the award; on August 27, 1970, they filed amended objections and exceptions. No citation was issued and served upon appellee, nor was any further action taken in the ease until June 11, 1976, at which time appellants filed written interrogatories which were served upon appellee. These interrogatories were not answered. On May 30, 1978, appellants filed a motion to compel answers. Appellee answered this motion August 28, 1978, setting forth that, subsequent to the filing of such interrogatories, appellants had abandoned their appeal from the award of the commissioners, and appellees moved for a dismissal of such appeal.

On June 27,1978, this cause was transferred, upon appellants’ motion, to the 9th District Court of Montgomery County. On September 22, 1978, the trial court heard the motions to compel and to dismiss. On December 13, 1978, the trial court entered its order dismissing appellants’ “appeal” from the commissioners’ award. The court further ordered that the award of the commissioners, dated July 24, 1970, be entered of record in the County Clerk’s Office of Montgomery, Texas. Appellants’ motion for new trial and motion to reinstate the cause were overruled.

Appellants’ first point complains of the trial court’s abuse of discretion in “finding that appellants failed to act with reasonable and/or due diligence in prosecuting their suit. . . .”

An intent to abandon is not a part of the test for a trial court to apply in passing upon a motion to dismiss for lack of prosecution. The sole test is whether the case was prosecuted with due diligence. See Bevil v. Johnson, 157 Tex. 621, 307 S.W.2d 85 (1957); Callahan v. Staples, 139 Tex. 8, 161 S.W.2d 489 (1942); Missouri Pacific Railroad v. Liberty County Water Control & Improvement District No. 6, 483 S.W.2d 50 (Tex.Civ.App. — Beaumont 1972, writ ref’d n. r. e.). A party who files a petition must prosecute his claim to judgment with reasonable diligence. If he fails to do this, the court has the inherent power to dismiss his claim for want of diligence in its prosecution. The matter rests in the sound discretion of the trial court. Bevil v. Johnson, supra; Pollok v. McMullen Oil & Royalty Co., 383 S.W.2d 837 (Tex.Civ.App. —San Antonio 1964, writ ref’d).

In the case at bar, when appellants filed their objections and exceptions to the award of the commissioners, the filing became a cause pending in the County Court. Such a cause so filed should be tried and determined as in other civil cases. The appellee became the plaintiff, and appellants became the defendants. Although appellants were defendants in the case, they had the burden of causing the issuance of citation and obtaining service of such citation upon appellee.

Even though appellee had the burden of proving its right to condemnation and the burden of going forward to trial, it was under no legal obligation to do so unless and until it had been served with citation. Denton County v. Brammer, 361 S.W.2d 198 (Tex.1962).

The record before us clearly establishes that upon the filing of the objections and exceptions to the commissioners’ award in 1970, a period of approximately eight years elapsed until the date of the dismissal order. During this period of time, citation had not been issued or served upon appellee. The only activity undertaken by appellants prior to the filing of appellee’s motion to dismiss was the filing of appellants’ written interrogatories, approximately six years after the filing of their objections and exceptions, and the filing of their motion to compel, two years after the filing of their written interrogatories. Appellee had never been served with citation and was under no legal obligation to respond thereto. Based upon these facts, the trial court found and held that appellants did not exercise due diligence and that such failure to do so were adequate grounds to dismiss the suit for failure to prosecute it with due diligence. We hold that such finding and conclusion was not an abuse of discretion. See Reed v. Reed, 158 Tex. 298, 311 S.W.2d 628 (1958); Bevil v. Johnson, supra; Petroleum Refining Co. v. McGlothlin, 429 S.W.2d 676 (Tex.Civ.App. — Eastland 1968, writ ref’d n. r. e.); Farr v. Jefferson Amusement Co., 396 S.W.2d 434 (Tex.Civ.App. — Texarkana 1965, writ dism’d); Moss v. State, 361 S.W.2d 408 (Tex.Civ.App. — Eastland 1962, no writ).

At the time of the hearing on appellee’s motion to dismiss, appellants did not offer any evidence in an attempt to explain their unreasonable delay in the prosecution of their case. The circumstances of this case with reference to unreasonable delay and lack of due diligence raises a rebuttable presumption of abandonment and lack of due diligence. Appellants’ failure or refusal to offer proof showing good reason for such delay causes the presumption to become conclusive, and the motion for dismissal should have been granted. See Denton County v. Brammer, supra; Bevil v. Johnson, supra; Missouri Pacific Railroad v. Liberty County Water Control & Improvement District No. 6, supra. This point is overruled.

In Appellants’ second point complaint is made that the trial court erred in denying appellants the opportunity to “explain their undue delay” in the prosecution of this case. The record before us reflects appellants’ motion to compel answers to interrogatories was filed on June 1, 1978. On August 28, 1978, appellee filed its answer to such motion and included therein its motion to dismiss appellants’ case. On that same date, appellants were advised by the District Clerk’s Office that a hearing on the motion to compel answers was set for September 22, 1978. Appellants had twenty-five days advance notice of the hearing date. On the date of the hearing, the record reflects appellants and appellee announced ready for the hearing. During the course of the hearing, appellants argued their motion to compel, and appellee argued its motion to dismiss. Presumably, appellants knew they were in a position of being required to offer evidence in excusing their long delay. They offered no such evidence and did not attempt to offer any. At the conclusion of the hearing, the court indicated he would grant appellee’s motion to dismiss, at which time appellants, for the first time, asked “for a re-setting so I may bring in witnesses. . . .” The court then stated, “I am not going to reset it for another hearing.” The trial court did not refuse to hear or to consider any evidence offered by appellants. At the conclusion of the hearing, the court refused to “reset it for another hearing”. Appellants had ample notice of the hearing and opportunity to prepare for the hearing. Even though they did not have any witnesses present at the hearing, they announced ready and proceeded to hear the motions. They offered no evidence and did not attempt to offer any evidence. The trial court did not refuse to hear any evidence. After the conclusion of the hearing, the court merely refused to reset it for another hearing. We find no error in the court’s action. We recognize the rule to be, as stated in our discussion under appellants’ first point, that whenever the question arises as to due diligence upon a motion to dismiss, the plaintiff has the right to be heard to explain, if he can, his delay in prosecuting his suit. Appellants were given a hearing on their motion to compel and appellee’s motion to dismiss, and appellants were given the right to offer evidence as to their excuse for undue delay, but did not exercise such right. They chose, after learning of the trial court’s indication to grant the motion to dismiss, to present any evidence they may have had at a later time at another hearing. In this connection, we point out that appellants subsequently filed their motion to reinstate • the cause, and at the time of hearing such motion, on January 5, 1979, they made no offer of any evidence as to any excuse for the unreasonable delay in prosecuting their case. Again they chose not to exercise their right to offer evidence as to their excuse for delay. This point is overruled.

In view of our disposition of appellants’ first two points, the remaining points 3, 4, and 5 are without merit and are overruled.

Finding no error, the judgment of the trial court is affirmed.

AFFIRMED.


author: KEITH, Justice.

text:
    TEXAS EMPLOYERS’ INSURANCE ASSOCIATION v. SECOND INJURY FUND of the State of Texas.
    No. 8275.
    Court of Civil Appeals of Texas, Beaumont.
    June 28, 1979.
    Robert L. LeBoeuf, Houston, for appellant.
    Donald M. Hugins, Houston, Paul R. Ga-via, Austin, for appellee.
   KEITH, Justice.

The defendant below appeals from an adverse judgment involving a death claim under the Workers’ Compensation Statute.

Percy Hall Smith, Jr., died of injuries he received in the course of his employment with Cities Service Company. His adult sons and estranged wife filed claims for death benefits under the compensation statute and the Industrial Accident Board made and entered its final award in the case.

Texas Employers’ Insurance Association, the compensation insurance carrier for the deceased’s employer, duly perfected an appeal from the final award to the district court naming the adult sons, the estranged wife, and the Second Injury Fund as defendants. All claimants thereafter filed pleadings seeking the maximum death benefits under the Act.

In effect, the jury found that the wife had abandoned the deceased without good cause for a period of three years before his death and that the sons were not dependent upon him. The judgment denied the wife and sons any benefits, and no appeal has been perfected from that portion of the judgment.

The Court entered judgment in favor of the Second Injury Fund for the maximum benefits payable in a lump sum after discount, and the carrier has appealed.

The rights and liabilities are governed by the provisions of Tex.Rev.Civ.Stat.Ann. art. 8306, § 12c — 2 (Supp.1978-79), quoted in the margin.

It was shown by answers to interrogatories that on June 6, 1978, the Second Injury Fund had a gross balance of $294,343.25, with existing liabilities of $14,729.00, or a net balance of $279,614.25. Although the trial did not commence until August 28, 1978, the Fund went to trial without amending its answers to interrogatories as is required by Tex.R.Civ.P. 168. Therefore, it is bound to these undisputed answers as they were offered and accepted into evidence at trial. See Richards v. Boettcher, 518 S.W.2d 286, 288 (Tex.Civ.App. — Texarkana 1974, writ ref’d n.r.e.); Barnwell v. Fox & Jacobs Constr. Co., 469 S.W.2d 199, 205-06 (Tex.Civ.App. — Dallas 1971, no writ); Hercules, Inc. v. Eilers, 458 S.W.2d 221, 232-33 (Tex.Civ.App. — Beaumont 1970, writ ref’d n.r.e.), cert. denied, 403 U.S. 937, 91 S.Ct. 2251, 29 L.Ed.2d 717 (1971).

In every death case arising under the Workers’ Compensation Act the Fund is a contingent claimant of the benefits payable because of the death of the employee. The statutes both create and measure the rights of the parties. Second Injury Fund v. Keaton, 162 Tex. 250,345 S.W.2d 711, 713 (1961). But, as held in Industrial Accident Board v. Texas Employers’ Ins. Ass’n, 162 Tex. 244, 345 S.W.2d 718, 720 (1961), the Fund is not entitled to receive payments under the Act until it establishes that “there [are] no person[s] entitled to compensation surviving the deceased employee.”

Also, as was held in Industrial Accident Board, supra, “It is elementary that the party seeking recovery of benefits must establish that he or it is entitled to such benefits.” The Court noted that the Act was silent as to the burden of proof and held that “the burden of proof was properly placed upon the Board to show that the facts entitle it to recover.” Id.

Another well-established rule should be mentioned at this point, namely, that when a state voluntarily submits itself to the jurisdiction of the courts, it becomes subject to the rules governing other litigants. See and compare Anderson, Clayton & Co. v. State, 122 Tex. 530, 62 S.W.2d 107, 110 (1933).

Making application of these elementary rules, we now hold that the Fund labored under the burden of proving two facts to the satisfaction of the trier of the facts before it was entitled to judgment under the Act: (1) that the deceased was not survived by beneficiaries entitled to receive the compensation benefits; and (2) that there was not in the fund a sum more than $250,000 in excess of all existing liabilities.

The Fund was entitled to recover the benefits only upon a showing that there was less than $250,000 in the fund; it made no such showing. On the contrary, it established that there was more than that sum in the fund. Consequently, the Fund “has not qualified under the statute for the benefits sought.” Industrial Accident Board v. Texas Employers’ Ins. Ass’n, supra (345 S.W.2d at 720).

There are hints in the brief filed by the Fund that the figures given under oath may have been erroneous. We are not authorized to consider out-of-the-record statements contained in briefs. See generally Joiner v. Federal Deposit Ins. Corp., 488 S.W.2d 953, 954 (Tex.Civ.App. — Amarillo 1972, no writ); Dale Truck Line, Inc. v. R. & M. Well Serv. & Drilling Co., 286 S.W.2d 446, 450 (Tex.Civ.App. — Galveston 1956, writ ref’d n.r.e.).

The time for the Fund to have made proof of its right to recover was in August, 1978, in the trial of the cause in the District Court and by sworn testimony. Suggestions in the brief constitute no evidence of probative force.

We conclude that the Fund has not established its right to recover benefits under the rationale of Industrial Accident Board v. Texas Employers’ Ins. Ass’n, supra. Consequently, we enter the judgment which the trial court should have entered: that the Fund as a claimant have and recover nothing from the carrier. This disposition of the case makes it unnecessary for us to consider the other points of error brought forward by the carrier.

REVERSED and RENDERED.

DIES, C. J., not participating.

      . Section 12c-2: “The special fund known as the ‘Second Injury Fund’ shall be created in the following manner:
      “(a) In every case of the death of an employee under this Act where there is no person entitled to compensation surviving said employee, the association shall pay to the Industrial Accident Board the full death benefits, but not to exceed 360 weeks of compensation, as provided in Section 8, of Article 8306, Revised Civil Statutes of Texas, 1925, as amended, to be deposited with the Treasurer of the State for the benefit of said Fund and the Board shall direct the distribution thereof.
      “(b) When the total amount of all such payments into the Fund, together with the accumulated interest thereon, equals or exceeds Two Hundred Fifty Thousand Dollars ($250,000) in excess of existing liabilities, no further payments shall be required to be paid to said Fund; but whenever thereafter the amount of such Fund shall be reduced below One Hundred Twenty-Five Thousand Dollars ($125,000) by reason of payments from such Fund, the payments to such Fund shall be resumed forthwith, and shall continue until such Fund again amounts to Two Hundred Fifty Thousand Dollars ($250,000) including accumulated interest thereon.”

      . It is stated in the brief of the Fund, more in the nature of an apology than as a fact: “[W]hile the answers of Jerry Belcher, Executive Director of the Industrial Accident Board of the State of Texas, given in his deposition and the answers to the written interrogatories propounded by TEIA to the Second Injury Fund were believed to be correct when given, it now appears that the net balance of the Second Injury Fund as of the date of trial was under $250,000.00, net of existing liabilities. The discrepancy between the answers given under oath and the actual figures are attributable to accounting errors which were not corrected by the Board’s accountants until April, 1979.
      "The actual figures were not made known to the undersigned [counsel] until May 10, 1979.”
      We refrain from commenting upon accounting procedures involving public funds, simply noting that judgment was entered on December 18, 1978, and Fund’s brief was served upon opposing counsel May 15, 1979.


author: DIES, Chief Justice.

text:
    Jim SEYMOUR and James Vowell, Appellants, v. R. L. GILLESPIE, Appellee.
    No. 8207.
    Court of Civil Appeals of Texas, Beaumont.
    June 28, 1979.
    Rehearing Denied July 31, 1979.

      L. Roger Ratliff, Silsbee, Danny W. Womack, Austin, for appellants.
    George E. Chandler, Lufkin, for appellee.
   DIES, Chief Justice.

Plaintiffs below, Jim Seymour and James Vo well, while conducting research for a project they were doing on the Big Ticket, proceeded onto the sawmill premises of R. L. Gillespie, defendant below. Plaintiffs had no prior arrangement or permission to enter defendant’s property. While there, an affray took place between the parties, which resulted in a lawsuit wherein plaintiffs contended defendant committed an assault and battery against them resulting in personal injuries.

Trial was to a jury, which found for the defendant, and from which plaintiffs have brought this review.

The only question presented here is the admissibility of a tape recording. One of the plaintiffs had such a device on his person at the time, and he says he only discovered it was operating when he got back to his car after the altercation. The trial judge refused to admit the tape recording into evidence.

The leading Texas case discussing the admissibility of a tape recording is Cummings v. Jess Edwards, Inc., 445 S.W.2d 767 (Tex.Civ.App. — Corpus Christi 1969, writ ref’d n. r. e.). That court (at 773) said:

“We further hold that exclusion of the tape recording, under the circumstances, was at least discretionary, and abuse of discretion by the trial court is not shown.”

The following cases have also held that such admissibility rests largely within the discretion of the trial judge: Schwartz v. State, 158 Tex.Cr.R. 171, 246 S.W.2d 174, 177-178 (Tex.Cr.App.1951); Drake v. State, 488 S.W.2d 534, 538 (Tex.Civ.App. — Dallas 1972, writ ref’d n. r. e.). See also Matter of Bates, 555 S.W.2d 420, 432 (Tex.1977); Edwards v. State, 551 S.W.2d 731, 733 (Tex.Cr.App.1977).

In the instant case, the trial judge refused to admit the tape because “some of it is very garbled and it is ununderstandable to the court.” The County Sheriff testified, “. . . but I couldn’t understand heads nor tails on it because all of it was loud scratching and fussing. . . . ”

Under these circumstances, we are unable to say the trial court abused his discretion and accordingly overrule plaintiffs’ points of error and affirm the judgment of the trial court.

AFFIRMED.


text:
    ALLIED BANKERS LIFE INSURANCE COMPANY, Appellant, v. Mary De La CERDA, as Community Administratrix of the Estate of Paul A. De La Cerda, Appellee.
    No. 8975.
    Court of Civil Appeals of Texas, Amarillo.
    June 29, 1979.
    Rehearing Denied Aug. 1, 1979.

      Harold W. McCracken, Dallas, Hall & Tollett, Littlefield, for appellant.
    Kirby, Raltiff, Sansom, Manning & Greak, Nolan E. Greak, Littlefield, for ap-pellee.
   DODSON, Justice.

Defendant Allied Bankers Life Insurance Company appeals from a judgment awarding Mary De.La Cerda, community adminis-tratrix of the Estate of Paul A. De La Cerda, $9,000 under a certificate of insurance together with statutory damages, prejudgment interest, attorney’s fees, and post-judgment interest. We affirm, conditioned on remittiturs of appellate attorney’s fees; otherwise, we affirm in part and reverse and remand in part.

On December 27, 1976, Paul A. De La Cerda secured a $9,000 group credit life insurance certificate from defendant Allied Bankers Life Insurance Company. The certificate, obtained in conjunction with a loan from Citizens National Bank of Earth, Texas, contained a statement that the insured had not been, nor was being, treated for certain diseases and that he was in good health. The certificate named the bank and insured’s estate first and second beneficiaries, respectively.

On February 3, 1977, insured died. The cause of death was diagnosed as acute myocardial infarction superimposed upon a previous anterolateral infarction. The bank filed its claim under the certificate, which was denied by defendant. Thereafter, the bank assigned its interest to Mrs. De La Cerda.

Mrs. De La Cerda brought this action against the Insurance Company to recover the proceeds under the life insurance certificate. The Insurance Company defended on the grounds that insured breached the good health warranty and made false representations concerning his good health which rendered the certificate unenforceable. Trial was to a jury, who found that insured did not know that any statements in his application were false at the time it was made; that $3,000 would fairly and reasonably compensate Mrs. De La Cerda for attorney’s fees through the trial court, $1,000 in the event of appeal to the Court of Civil Appeals sitting in Amarillo, and $750 in the event of an appeal to the Texas Supreme Court. Based on these findings, the trial court entered its judgment awarding Mrs. De La Cerda $9,000 plus $1,080 in statutory damages, $430.52 prejudgment interest, attorney’s fees as' found by the jury, and post-judgment interest.

I.

Defendant maintains in its first two points of error that the trial court erred in overruling its motion for instructed verdict and motion for judgment notwithstanding the verdict because the breach of warranty defense was conclusively established as a matter of law, or alternatively, that the court erred in failing to submit the warranty defense to the jury because it was raised by the evidence. Both of these points are predicated upon a determination that the good health statement in the certificate is a warranty rather than a representation.

The Texas Supreme Court has recognized that a warranty in an insurance contract is “ ‘a statement made therein by the insured, which is susceptible of no construction other than that the parties mutually intended that the policy should not be binding unless such statement be literally true.’ ” Lane v. Travelers Indemnity Company, 391 S.W.2d 399, 402 (Tex.1965), quoting Phoenix Assur. Co. v. Munger Imp. Cotton-Mach. Mfg. Co., 92 Tex. 297, 49 S.W. 222, 225 (1898). In other words, the parties must have intended that the policy stand or fall on the literal truth or falsity of the statement in question. Such warranties which cause forfeiture are disfavored in the law. Lane v. Travelers Indemnity Company, supra. See also 12 J. A. Appleman, Insurance Law & Practice § 7342 (1943).

A representation is “an oral or written statement which precedes the contract of insurance and is no part thereof, unless it be otherwise stipulated, * * * and relates to the facts necessary to enable the underwriter to form his judgment whether he will accept the risk, and at what premium.” See Lane v. Travelers Indemnity Co., supra, 391 S.W.2d at 401; Doyle v. Great Southern Life Ins. Co., 126 S.W.2d 735, 737 (Tex.Civ.App. — Galveston 1939), affirmed, 136 Tex. 377, 151 S.W.2d 197 (1941). Thus, by definition a representation is not a part of the contract. This, however, does not preclude the inclusion of representations within the policy itself. “Such statements will be given effect only as representations and not as warranties when it is expressly stipulated that they are merely representations, or if it appears from the contract read as a whole that they were so intended.” 7 G. J. Couch, Insurance 2d, § 35:9 (1961); Lane v. Travelers Indemnity Co., supra.

In the case at bar, the certificate of insurance signed by Mr. De La Cerda contains the following statement:

I hereby certify that I am not being treated, nor have I been treated for any disease or disorder of the heart, the liver, stroke, high blood pressure, tuberculosis, emphysema, ulcers, paralysis, urinary or kidney disorder, cancer, diabetes, and to the best of my knowledge and belief I am in good health as of the above effective date.

The certificate further provides:

In consideration of the premium and. the representation of good health arid gainful employment, as shown above, hereby insures the person/persons named above as Insured Debtors for the benefits under the Plan or Plans for which premiums are specified in the Schedule above (but none other), subject to all of the terms, conditions and provisions of this Policy (emphasis added).

This language is clear and unambiguous. The certificate expressly provides that the named person is insured “in consideration of the premium and the representation of good health.” In light of the rule of contract construction providing that clear and unambiguous terms be given their plain and ordinary meaning, De La Cruz v. Combined American Insurance Co., 527 S.W.2d 820, 821 (Tex.Civ.App. — Amarillo 1975, writ ref’d n.r.e.), we are persuaded that the good health statement is a representation rather than a warranty. Moreover, we find no provision in the certificate which requires a construction that the parties mutually intended that the certificate of insurance not be binding unless such good health statement be literally true.

In essence, defendant would have us rewrite the good health statement in the certificate to comport with the statement contained in Great American Reserve Insur ance Company v. Britton, 406 S.W.2d 901 (Tex.1966), which defendant cites in support of its position. In Britton, the statement in question provided:

[T]he policy shall not take effect until it has been delivered to its owner during the lifetime and good health of the Insured.

See also Texas Prudential Insurance Co. v. Dillard, 158 Tex. 15, 307 S.W.2d 242, 243 (1957); Travis Life Insurance Co. v. Rodriguez, 326 S.W.2d 256, 257 (Tex.Civ.App.— Austin), writ ref’d n. r. e. per curiam, 160 Tex. 182, 328 S.W.2d 434 (1959). By its very language, the statement in Britton is distinguishable from the statement in the case at bar. We therefore do not consider Britton controlling.

We note that misrepresentation is also an affirmative defense. This defense was submitted to the jury, who found that insured did not know that any statements in his application were false at the time it was made. Defendant does not attack this finding.

We conclude, as a matter of law, that the statement of good health is a representation rather than a warranty. Therefore, the trial court did not err in overruling defendant’s motion for instructed verdict and motion for judgment notwithstanding the jury’s verdict, nor was defendant entitled to have a breach of warranty defense submitted to the jury.

II.

Defendant maintains that the trial court erred in awarding prejudgment interest because this action was brought under Tex. Ins.Code Ann. art. 3.62 (Vernon 1963), which does not specifically authorize the recovery of prejudgment interest. We do not agree.

This is an action in part to recover $9,000 under a contract of insurance. Article 5069-1.03 of Tex.Rev.Civ.Stat.Ann. (Vernon 1971) provides, in part:

When no specified rate of interest is agreed upon by the parties, interest at the rate of six percent per annum shall be allowed on all written contracts ascertaining the sum payable, from and after the time when the sum is due and payable .

This article has been held to sustain an award of prejudgment interest in an action on an insurance contract. Combined Insurance Co. of America v. Kennedy, 495 S.W.2d 306, 308 (Tex.Civ.App. — Eastland 1973, writ ref’d n. r. e.).

Defendant relies on Duffer v. American Home Assurance Co., 512 F.2d 793 (5th Cir.1975). Duffer involved a suit for $100,000 due under a group traveler insurance policy. Prejudgment interest under Art. 5069-1.03, supra, was allowed on the $100,000 sum. The court, however, did strike prejudgment interest on the portion of the judgment awarding damages and attorney’s fees under article 3.62 of Tex.Ins.Code Ann., supra.

In the case at bar, the six percent prejudgment interest is limited to the $9,000 due under the certificate of insurance. The judgment specifically excludes prejudgment interest on the award of damages and attorney’s fees under article 3.62 of the Insurance Code. Under these circumstances, we conclude that the trial court did not err in awarding prejudgment interest totaling $430.52.

III.

Defendant claims that the trial court erred in overruling its Motion in Limine to prohibit testimony that insured could read little, if any, English and in allowing such testimony to be introduced during the trial. Defendant also maintains that the court erred in admitting certain certificates of insurance previously issued to insured by defendant, but which had expired prior to the time the certificate of insurance in question was effectuated. Defendant objected to the admissibility of this evidence on grounds that it was irreleyant, immaterial, and highly prejudicial.

Defendant raised the affirmative defense of misrepresentation. Thus, it was incumbent upon defendant to show that the statement of the insured was material, false, made with the intent to deceive, and that it was relied on by defendant. Clark v. National Life & Accident Ins. Co., 145 Tex. 575, 200 S.W.2d 820, 823 (1947). The defense was submitted to the jury in substantially this form. We are persuaded that the challenged testimony is relevant and material to some, if not all, of these issues.

Assuming, arguendo, that the evidence was improperly admitted, we are also persuaded, after a review of the entire record, that such error was not reasonably calculated to cause nor probably did cause the rendition of an improper judgment. Therefore, such error would be harmless. Tex.R.Civ.P. 434. See also State v. Parrish, 159 Tex. 306, 320 S.W.2d 330, 332-33 (1958); Walker v. Texas Employers’ Insurance Ass’n, 155 Tex. 617, 291 S.W.2d 298, 301 (1956).

We conclude that the trial court committed no reversible error in admitting the challenged testimony.

IV.

Defendant’s final points of error attack the following award of attorney’s fees, as found by the jury and reduced to judgment:

. attorney’s fees in the amount of $3,000.00, and attorney’s fees in the amount of $1,000.00 in the event an appeal of this suit to the Court of Civil Appeals sitting at Amarillo, Texas, and attorney’s fees in the amount of $750.00 in the event of an appeal of this lawsuit to the Supreme Court of Texas.

Defendant maintains that Mrs. De La Cerda is precluded from recovering attorney’s fees because she had a contingent fee arrangement with her attorney. We disagree. In determining the award of attorney’s fees under Tex.Ins.Code Ann. art. 3.62, supra, the contract arrangement is immaterial. See First Bankers Insurance Co. v. Howell, 446 S.W.2d 711, 714 (Tex.Civ.App. — Amarillo 1969, no writ).

Defendant next attacks the legal sufficiency of the evidence to support the award of attorney’s fees in the amount of $3,000, and further contends that there is no evidence that the amount is reasonable. In determining the legal sufficiency of the evidence, we must consider only the evidence which supports the jury’s findings and disregard all evidence to the contrary. Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965).

The evidence shows that Mrs. De La Cerda’s attorney spent more than fifty hours in preparation of the case prior to trial. The trial consumed one and one-half days. The attorney testified that he charged $50 per hour for his services and that a more experienced attorney in the area charged a much greater hourly rate. This constitutes some evidence of probative force that Mrs. De La Cerda’s attorney rendered service valued at $3,000. Furthermore, it is the responsibility of the trier of facts to determine the reasonable value of an attorney’s services. Harlow v. Southern Farm Bureau Casualty Ins. Co., 439 S.W.2d 365, 368 (Tex.Civ.App. — Austin 1969, writ ref’d n. r. e.). We overrule defendant’s contentions.

The Insurance Company next contends that the $1,000 award for attorney’s fees in the event of an appeal to this court and the $750 award for attorney’s fees in the event of an appeal to the Supreme Court of Texas is excessive because the evidence supports awards of $750 and $500, respectively. We agree. An attorney from Littlefield, Texas, gave the only testimony concerning attorney’s fees for an appeal to these courts. He related some of the matters incident to appeal, both as appellant and appellee, and stated that $750 would be a reasonable attorney’s fee for an appeal to this court and $500 would be a reasonable attorney’s fee for an appeal to the Supreme Court of Texas. We conclude that the evidence supports only an award of $750 and $500 in reasonable attorney’s fees in the event of an appeal to the respective courts. Therefore, we suggest a remittitur of $250 in each instance. See Tex.R.Civ.P. 440.

Defendant also contends that the judgment is invalid because the matter of attorney’s fees is not definite and certain. In support of its position, defendant says that International Security Life Ins. Co. v. Spray, 468 S.W.2d 347, 350 (Tex.1971), requires the form of the judgment to provide for a remittitur of appellate court attorney’s fees if there is no appeal. We do not give Spray this limiting construction. In Spray, the court said, inter alia:

So long as the judgment of the court makes the figure which the clerk is to place in the writ of execution determinable by ministerial act, the judgment cannot be said to lack definiteness.

In the case before us, the judgment regarding appellate attorney’s fees meets the definiteness test of Spray. See Twin City Fire Ins. Co. v. Cortez, 562 S.W.2d 940, 945 (Tex.Civ.App. — Amarillo), rev’d on other grounds, 576 S.W.2d 786 (Tex.1978).

In summary, defendant’s points of error one through twelve and fourteen are overruled. The thirteenth point of error is sustained to the extent that attorney’s fees in the amount of $1,000 for an appeal to this court is excessive by $250 and that attorney’s fees in the amount of $750 in the event of appeal to the Supreme Court of Texas is excessive in the amount of $250. Any other contentions raised in the thirteenth point are overruled.

Accordingly, if Mary De La Cerda files in this court within fifteen days from the date of this opinion and judgment a remittitur of $250 from the award of attorney’s fees in the amount of $1,000 in the event of appeal to this court and a remittitur of $250 from the award of attorney’s fees in the amount of $750 in the event of an appeal to the Supreme Court of Texas, the judgment will be affirmed; otherwise, the portion of the judgment pertaining to appellate attorney’s fees will be severed and reversed and that portion of the judgment will be remanded, and the remainder of the judgment will be affirmed.

The judgment of the trial court is affirmed, conditioned on the suggested remit-titurs.

COUNTISS, J., not participating.

ADDENDUM

On July 3, 1979, Mary De La Cerda filed remittiturs as suggested in our original opinion dated June 29, 1979. Accordingly, that portion of the trial court’s judgment awarding attorney’s fees “in the amount of $1,000.00 in the event of an appeal of this suit to the Court of Civil Appeals sitting at Amarillo, Texas,” is reformed to read $750.00 and that portion of the judgment awarding attorney’s fees “in the amount of $750.00 in the event of an appeal of this lawsuit to the Supreme Court of Texas” is reformed to read $500.00. As reformed, the judgment is affirmed.

COUNTISS, J., not participating.

      . The remainder of the statement provides:
      I hereby authorize any licensed physician, medical practitioner, hospital, clinic or other medical or medically related facility, insurance company or other organization, institution or person, that has any records or knowledge of me or my health, to give to the Allied Bankers Life Insurance Company any such information, and waive all provisions of law forbidding disclosures of such information. A photographic copy of this authorization shall be as valid as the original.


author: RALEIGH BROWN, Justice.

text:
    Mike DUNN et al., Appellants, v. Benny BROWN et ux., Appellees.
    No. 5338.
    Court of Civil Appeals of Texas, Eastland.
    July 5, 1979.
    Rehearing Denied July 26, 1979.

      Samuel B. Moore, Jr., Robinson, Hanna, Moore & Holloway, Inc., Abilene, for appellants.
    Cletus C. Schenk, Wichita Falls, for ap-pellees.
   RALEIGH BROWN, Justice.

This is a venue case. Benny Brown and Mona Boatright Brown sought damages in Baylor County against Eagle Bonding Company and its employees, Mike Dunn and Danny Morgan, for alleged injuries caused by defendants’ withdrawal from criminal surety bonds. Plaintiffs took a nonsuit as to Morgan and Dunn. Eagle Bonding Company’s plea of privilege to be sued in its residence, Taylor County, was overruled after plaintiffs filed their controverting plea invoking Exceptions 9, 23 and 30 of Tex. Rev.Civ.Stat.Ann. art. 1995 and Section 17.-56 of the Texas Business and Commerce Code, the special venue provisions of the Deceptive Trade Protective-Consumer Protection Act. The Company appeals. We reverse and order the cause transferred to Taylor County.

Eagle Bonding Company made criminal surety bonds for Benny and Mona Brown in the amount of $10,000 each to guarantee their appearance in Taylor County before Justice of the Peace Clark to respond to a fugitive complaint from the State of Oklahoma. The agreement to make the bond was made in Taylor County and the bond fee was paid in Taylor County.

Four days after making the bonds and their release from the Taylor County jail, plaintiffs were arrested in Baylor County on five felony warrants each from Baylor County and two felony warrants each from Throckmorton County. Two days after such arrests, Mona Brown was released from the Baylor County jail on bonds made by her attorney, Cletus Schenk, as to the Baylor County and Throckmorton County charges. Benny Brown remained in jail in lieu of similar bonds.

Approximately forty-five days after her release, Mona Brown was arrested while visiting Benny Brown in jail on warrants issued by Justice of the Peace Clark after Eagle Bonding Company had made application to be released from its bond obligations. By letter dated one day after Mrs. Brown's subsequent arrest, Mona Brown's attorney also notified the Sheriff of Baylor County that he had been relieved of his bond obligations as to Mona Brown.

One month later, June 3, 1977, the charges in Taylor County were dismissed because no warrants had been received from the Governor of Oklahoma. On July 1, 1977, Benny and Mona Brown were released from the Baylor County jail on criminal surety bonds made by their attorney, Cletus Schenk, as to the Baylor County and Throckmorton County charges.

Subdivision 30 of Tex.Rev.Civ.Stat.Ann. art. 1995 provides:

Special venue — Whenever in any law authorizing or regulating any particular character of action, the venue is expressly prescribed, the suit shall be commenced in the county to which jurisdiction may be so expressly given.

Section 17.56 of the Texas Business and Commerce Code, the special venue provision of the Deceptive Trade Practice-Consumer Protection Act, provides:

An action brought which alleges a claim to relief under Section 17.50 of this subchapter may be commenced in the county in which the person against whom the suit is brought resides, has his principal place of business, or has done business.

Benny and Mona Brown failed to plead any of the acts or practices which are declared unlawful by Section 17.46 of the Deceptive Trade Practices-Consumer Protection Act. They also failed to plead that Eagle Bonding Company’s withdrawal as surety on their bonds constituted unconscionable conduct.

Articles 17.16 and 17.19 of the Code of Criminal Procedure, Tex.Rev.Civ.Stat.Ann., provide for surrender of a principal by a surety or sureties. Article 17.16 states:

Those who have become bail for the accused, or either of them, may at any time relieve themselves of their undertaking by surrendering the accused into the custody of the sheriff of the county where he is prosecuted.

Article 17.19 provides:

Any surety, desiring to surrender his principal, may upon making affidavit of such intention before the court or magistrate before which the prosecution is pending, obtain from such court or magistrate a warrant of arrest for such principal, which shall be executed as in other cases.

These statutes permit a surety to relieve himself of his obligation under the bond at any time, ex parte, without any form of hearing and such statutes have been held to be constitutional. Ex parte Vogler, 495 S.W.2d 893 (Tex.Cr.App. — 1973).

Eagle Bonding Company has complied with the statutory requirements to withdraw as surety on the Brown bonds. If its withdrawal is without reasonable cause, Benny and Mona Brown’s remedy lies in Article 2372p-3(13), Tex.Rev.Civ.Stat.Ann., if the county of prosecution has a population of 124,000 according to the last federal census or in a civil action for breach of contract against the bonding company. Karakey v. Mollohan, 15 S.W.2d 692 (Tex.Civ. App.—El Paso 1929, no writ); Ex parte Vogler, supra.

Plaintiffs failed to sustain venue in Baylor County under Subdivision 30, Art. 1995, Tex.Rev.Civ.Stat.Ann. and Section 17.56 of the Texas Business and Commerce Code.

Subdivision 9 provides:

Crime or trespass.—A suit based upon a crime, offense, or trespass may be brought in the county where such crime, offense, or trespass was committed by the defendant, or by his agent or representative, or in the county where the defendant has his domicile. This subdivision shall not apply to any suit based upon negligence per se, negligence at common law or any form of negligence, active or passive.

Benny and Mona Brown contend that Eagle Bonding Company committed a crime or trespass against them in that the company violated Article 2372p-3(13), Tex.Rev.Civ. Stat.Ann. Neither Baylor County nor Taylor County had population of 124,000 according to the last federal census and, therefore, Article 2372p-3(13), Tex.Rev.Civ. Stat.Ann. has no application in the instant cause. Even assuming the applicability in the case at bar, it does not provide any criminal sanctions for failure to comply with its provision but merely authorizes the court to order refund of part or all of the bond fee if withdrawal is without reasonable cause.

Eagle Bonding Company cannot be held to have falsely imprisoned the plaintiffs. They were being held on several charges from Baylor and Throckmorton counties as well as the warrant from Taylor County. They remained in jail in Baylor County for approximately one month on the other charges after the felony fugitive complaint in Taylor County was dismissed.

The court in Black v. Kroger Co., 527 S.W.2d 794 (Tex.Civ.App.—Houston (1st Dist.) 1975, no writ) said:

False imprisonment in Texas is the direct restraint by one person of the physical liberty of another without adequate legal justification. Its essential elements are: (1) a wilful detention of the person; (2) a detention without authority of law; and (3) a detention without the consent of the party detained. J. C. Penney Co. v. Duran, 479 S.W.2d 374 (Tex.Civ.App.— San Antonio, 1972, writ ref’d n. r. e.).

Eagle Bonding Company complied with Article 17.16 and 17.19, Code of Criminal Procedure and, therefore, the confinement of Benny and Mona Brown as to the Taylor County matter was with legal authority. Plaintiffs failed to sustain venue in Baylor County under Subdivision 9 of Article 1995, Tex.Rev.Civ.Stat.Ann.

Subdivision 23, Article 1995, Tex. Rev.Civ.Stat.Ann., provides:

Corporations and associations.—Suits against a private corporation, association, or joint stock company may be brought in the county in which its principal office is situated; or in the county in which the cause of action or part thereof arose; or in the county in which the plaintiff resided at the time the cause of action or part thereof arose, provided such corporation, association or company has an agency or representative in such county; .

It is undisputed Eagle Bonding Company’s principal office is located in Taylor County and there is no pleading or proof that it had an agent or representative in Baylor County at the time the alleged cause of action arose. The cause of action, if any, arose in Taylor County when Eagle Bonding Company withdrew as surety on the bonds.

Benny and Mona Brown failed to sustain venue in Baylor County under Subdivision 23, Article 1995, Tex.Rev.Civ.Stat.Ann.

The trial court erred in overruling the plea of privilege. The judgment is reversed and the cause ordered transferred to Taylor County.


author: HALL, Justice.

text:
    Wallinda Gray RANKIN, Appellant, v. Ralph D. GRAY, Appellee.
    No. 6096.
    Court of Civil Appeals of Texas, Waco.
    July 5, 1979.
    Rehearing Denied Aug. 2, 1979.

      William B. Ray, Copperas Cove, for appellant.
    Jerry B. Donaldson, Byron L. McClellan, Jr., Donaldson & McClellan, Copperas Cove, for appellee.
   HALL, Justice.

This suit began as a habeas corpus proceeding brought by the father against the mother for possession of their two children, under the provisions of V.T.C.A. Family Code § 14.10. The mother filed a cross action for custody. Judgment was rendered in favor of the father. The mother appeals. We reverse the judgment and remand the case for further proceedings.

§ 14.10 of the Family Code provides as follows:
“§ 14.10. Habeas Corpus
(a) If the right to possession of a child is presently governed by a court order, the court in a habeas corpus proceeding involving the right to possession of the child shall compel return of the child to the relator if and only if it finds that the relator is presently entitled to possession by virtue of the court order.
(b) The court shall disregard any cross action or motion pending for modification of the decree determining managing con-servatorship, possession, or support of or access to the child unless it finds that:
(1) the previous order was granted by a court that did not have jurisdiction of the parties; or
(2) the child has not been in the relator’s possession and control for at least 6 months immediately preceding the filing of the petition for the writ.
(c) The court may issue any appropriate temporary order if there is a serious immediate question concerning the welfare of the child.
(d) While in this state for the sole purpose of compelling the return of a child through a habeas corpus proceeding, the relator is not amenable to civil process and is not subject to the jurisdiction of any civil court except the court in which the writ is pending and in that court only for the purpose of prosecuting the writ.
(e) If the right to possession of a child is not governed by a court order, the court in a habeas corpus proceeding involving the right of possession of the child shall compel return of the child to the relator if, and only if, it finds that the relator has a superior right to possession of the child by virtue of the rights, privileges, duties, and powers of a parent as set forth in Section 12.04 of this code.
(f) The court shall disregard any motion for temporary or permanent adjudication relating to the possession of the child in a habeas corpus proceeding brought under Subsection (e) of this section unless at the time of the hearing an action is pending under this subtitle, in which case the court may proceed to issue any temporary order as provided by Section 11.11 of this code.”

The facts are undisputed. Appellant-mother Wallinda Gray Rankin and appellee-father Ralph D. Gray were divorced by judgment of the Superior Court of Coos County, New Hampshire, on February 14, 1978. The custody of their two children, a son born in 1970 and a daughter born in 1972, was awarded to appellant. Appellee was ordered to pay child support, and he complied with the order. Prior to the divorce the parties resided with the children in New Hampshire. It was provided in the divorce decree that in the event appellant moved from New Hampshire appellee would have the right to have the children visit with him in New Hampshire for a reasonable period of time during their school vacations in the summers. Appellant moved with the children to the City of Copperas Cove, Coryell County, Texas, in February, 1978, where they have resided continuously since that time. Appellant has remarried, and she and her husband and the children live together. Her husband is in the United States Army, and he is seeking to be permanently stationed in Coryell County. Appellee resides in New Hampshire with a woman not his wife, and her two children.

In June or July, 1978, appellee contacted appellant by telephone and expressed the desire to exercise his visitation right with the children. After talking with the children, appellant refused to permit appellee visitation in New Hampshire, asserting that notice to the children of their impending visit with appellee, there, had resulted in bed-wetting and crying by the children. Her offer to let appellee visit with the children in Texas was declined by appellee.

In October, 1978, appellee petitioned the Court in New Hampshire which granted the divorce for an order modifying the original decree to change custody of the children to him. Appellant was served in Coryell County, Texas, with citation in that proceeding, but she did not answer the suit and did not make any appearance in it. On November 9, 1978, the New Hampshire Court amended the original decree and awarded custody of the children to appellee. He then ceased paying child support. Appellant learned of the amended order in January, 1979, when she contacted court personnel in New Hampshire concerning the support payments.

On March 6, 1979, appellee initiated the present suit in the District Court of Coryell County, Texas, by way of a petition for writ of habeas corpus to secure custody of the children from appellant. Appellee pleaded the order of the New Hampshire Court vesting custody in him. The matter was set for hearing on March 15th. Appellant was served with citation on March 13th. On the day set for the hearing appellant answered the petition for writ of habeas corpus and alleged the court in New Hampshire did not have jurisdiction to modify the original custody order. Also, prior to the hearing on the writ, appellant filed a cross action for modification of the order of the New Hampshire Court vesting custody in appel-lee in which she alleged that the children had resided with her in Texas continuously since February, 1978; that it was in the best interest of the children that their custody be awarded to her; and that the court had jurisdiction of the cross action under the provisions of Texas Family Code § 14.-10(b)(2). She also pleaded for the court to order “a social study to determine the environment of both households seeking conser-vatorship.”

After a hearing without a jury on March 15th, final judgment was signed by the court on May 9, 1979, ordering appellant to deliver the children and their possessions to appellee on June 14th. Formal findings of fact and conclusions of law were not requested by the parties nor filed by the court. However, in the judgment the court set forth the conclusions that the modification order of the New Hampshire Court was entitled to full faith and credit and that appellee’ was entitled to possession of the children as a matter of law.

Among other arguments for reversal, appellant contends the court erred in refusing to consider and permit proof of her cross action for custody. We agree.

It is clear from the record and the final judgment in the case that the trial court refused to hear appellant’s cross action for custody, and that the issues of fitness of the parents and the best interests of the children relating to the question of custody were not considered by the court. It is equally clear from the record the court based the judgment on one of these two theories: (1) The provisions of § 14.10(b)(2) were not applicable under the facts and it therefore did not have jurisdiction to consider the cross action; or (2) if the terms of § 14.10(b)(2) were triggered under the record, the consideration or not of appellant’s cross action was discretionary with the court. Appellee urges those theories for affirmance of the judgment.

It is our view the court had jurisdiction of the cross action, and that it erred in refusing to hear it. § 14.10(b)(2) provides that in a habeas corpus proceeding like this one where the relator is entitled to custody or possession of the child by virtue of a court order, the court shall disregard a cross action for custody or possession unless it finds the child has not been in the relator’s possession and control for at least six months immediately preceding the filing of the petition for the writ. Our record shows without contradiction that during the six months immediately preceding the filing of appellee’s petition for writ of habeas corpus on March 6, 1979, the children in question had been physically present in Texas with appellant and had not been in appellee’s possession and control. Appellee’s lack of possession and control during that term was not brought about by appellant’s violation of his visitation rights, and we need not decide what effect such circumstance might have had on the parties’ rights in this case.

Appellee argues that the possession and control referred to in paragraph (b)(2) means the legal right to possession and control which he had under the modification order of the New Hampshire Court for four months prior to filing his petition. We believe the statute means actual, physical possession and control by the relator. Paragraph (a) vests a prima facie right to possession in the party armed with a valid court order entitling him to possession. Paragraph (b)(2) is plainly an exception to that right. It assumes the existence of the court order in relator’s favor. It speaks to that order. Without the order the relator would have no standing under paragraph (a) of § 14.10; and he would be required to bring his custody suit under another section of the Family Code. The “relator” whose possession and control is addressed in paragraph (b)(2) is the relator referred to in paragraph (a) who has an outstanding custody order. To construe the words “possession and control” in paragraph (b)(2) to mean legal right to possession and control would render the terms of that paragraph meaningless, because the relator must come to court with the legal right which necessarily would be held by him “immediately preceding” the filing of his petition.

§ 14.10 was enacted by the Legislature to change the rule permitting the retrial of the right to custody of the child in a habeas corpus proceeding. Trader v. Dear (Tex.1978) 565 S.W.2d 233, 235; Lamphere v. Chrisman (Tex.1977) 554 S.W.2d 935, 937.

In Strobel v. Thurman (Tex.1978), 565 S.W.2d 238, 239, the Court said that under § 14.10 the writ should be granted “upon proof of the bare legal right to possession,” but the Court continued as follows:

“There are some exceptions to this use of the remedy. A writ may be denied if the prior order ‘was granted by a court that lacked jurisdiction,’ section 14.-10(b)(1), ‘if the child has not been in the relator’s possession for at least 6 months,’ section 14.10(b)(2), ‘if there is a serious immediate question concerning the welfare of the child,’ section 14.10(c), or ‘if the right to possession of a child is not governed by a court order.’ Section 14.-10(e).” None of those exceptions exist in this case.
The father [respondent in the habeas corpus proceeding] suggests that there may be a serious question concerning the welfare of the child because of his threat to run away from home. The court’s order [granting relator possession of the child under an Indiana custody decree] was not placed on that ground, and the brief record does not show any serious immediacy for a disregard of the Indiana decree.”

In Lamphere v. Chrisman (Tex.1977) 554 S.W.2d 935, 937, the. court first determined that the facts of that case did not bring it within the provisions of paragraph (b)(2), and then held: “The exception of Section 14.10(b)(2) therefore did not come into play, and Judith [the relator-mother under a Missouri decree] was entitled to the issuance of the writ without the relitigation of the right to possession question [under the father’s pleadings for custody].”

Under the cases cited above (and others by our Supreme Court dealing with the problem) it is settled that if the exception in § 14.10(b)(2) is not raised on the hearing for writ of habeas corpus, the rela.tor meeting the requirement of paragraph (a) of the statute is entitled to immediate possession of the child without relitigation of the issues of right of possession and the best interest of the child. Nevertheless, we believe those cases implicitly stand for the rule that when the exception is triggered by the filing of the cross action, and by the finding of the court under disputed facts or by undisputed evidence (as in our case) of the existence of the six-months period, then it is the duty of the court to hear evidence on the cross action before he grants or denies the writ. Under the contrary holding sought by appellee, the court could arbitrarily disregard the cross action and grant the writ under the provisions of paragraph (a) even though the relator had neither possession or custody of the child nor any contact with the child for any term longer than six months, perhaps several years, regardless of its length, without right of review by the respondent. We do not believe that was the Legislature’s intent in enacting the exception. It might be proper to grant the writ in favor of a relator wh.o had not had possession and custody or contact with the child for the minimum term required in the exception, or for a much longer term, after hearing the cross action, but a record would have been made for reviewing the court’s action on appeal.

In the light of the court’s rulings during the course of the trial on its jurisdiction and discretion under the statute, the parties did not develop their respective positions on the cross action. Also, appellant did not develop her case by bill of exception. Nevertheless, the evidence we have recited is the only evidence touching upon the present circumstances surrounding the parties and the children, and their relationships. Although meager it stands alone and undisputed in the record, we hold it supports the conclusion that the court abused its discretion in granting the writ.

The remaining contentions of both parties are without merit and are overruled.

The judgment is reversed. The case is remanded to permit the parties to try the cross action.


author: HUGHES, Justice.

text:
    Charles Glenn CUNNIFF, Appellant, v. Ethel May JOHNSON, Appellee.
    No. 18122.
    Court of Civil Appeals of Texas, Fort Worth.
    July 5, 1979.
    Rehearing Denied Aug. 2, 1979.
    Norman & Bates, and Gerald A. Bates, Fort Worth, for appellant.
    Messer, Potts & Messer, Belton, McBryde, Bogle & Green, and James H. Harp, Fort Worth, for appellee.
   OPINION

HUGHES, Justice.

Charles Cunniff has appealed a judgment rendered against him for arrearages in child support payments. Such payments were ordered years before in a divorce decree. The question for review is whether the trial court abused its discretion in granting his former wife’s motion to reduce the arrear-age to judgment because the trial court failed to find that the action is barred by laches.

We affirm.

Cunniff was ordered to pay $300.00 per month in support of his two children pursuant to a decree of divorce made on June 25, 1970. It is undisputed that Cunniff is about $14,000.00 in arrears. Mrs. Johnson, Cun-niff’s ex-wife, filed a motion to reduce this arrearage to judgment pursuant to § 14.09 of the Texas Family Code. The trial court heard the matter without a jury and found that Cunniff had made only partial monthly child support payments during the period of time from September 1,1970, until October 15, 1977. The record reflects that Cunniff paid $150.00 per month for most of this time and $75.00 per month for the remaining months.

The trial court also found that Mrs. Johnson had orally agreed to reduce Cunniff’s child support obligations upon the condition that Cunniff would maintain medical insurance on the children of the marriage. There is a dispute as to whether Mrs. Johnson agreed to a reduction to $200.00 or $150.00. However, it is undisputed that Mrs. Johnson accepted $150.00 per month for a number of years. It is also undisputed that neither party sought to modify or enforce the support order through a proper judicial proceeding until Mrs. Johnson filed a motion for contempt on February 6, 1978 and then amended her pleading with a motion to reduce to judgment on April 11, 1978.

Cunniff has complained of the trial court’s judgment in three points of error. Basic to each point is his contention that the trial court abused its discretion by failing to apply the equitable doctrine of laches to bar Mrs. Johnson’s recovery. Cunniff has admitted that his oral agreement with Mrs. Johnson to reduce his support obligation is unenforceable and that the statute of limitations for reduction of child support arrearage to judgment is ten years. Houtchens v. Matthews, 557 S.W.2d 581 (Tex.Civ.App. — Fort Worth 1977, writ dism’d). However, his position is that Mrs. Johnson, by waiting over seven years, waited too long to decide not to honor her oral agreement; that this delay has prejudiced him, and thus her recovery should be barred by laches.

Cunniff has not cited (nor can we find) a case where laches has been applied to bar recovery in a child support case in Texas. The Supreme Court has held that, without some element of estoppel, laches will not bar an action before the limitation period has run. Delta County Levee Improv. Dist. No. 2 v. Leonard, 516 S.W.2d 911 (Tex.1975), and K & G Tool & Service Co. v. G & G Fishing Tool Service, 158 Tex. 594, 314 S.W.2d 782 (1958). However, child support was not involved in either of these cases. Cunniff has cited as authority for the application of laches to child support cases Mitchell v. Mitchell, 575 S.W,2d 311 (Tex.Civ.App. — Dallas 1978, no writ). In Mitchell the court refused to apply laches because no basis for estoppel existed. The trial court in Mitchell had found that there was no agreement for any reduction in child support. The court did not comment whether laches would have applied if there had been such.an agreement.

Here the trial court did find there was an agreement for the reduction of child support. However, it made a further finding that the essential elements of estoppel were not present. Thus the trial court concluded that even though there was an agreement to reduce the amount of child support, Cun-niff failed to show any estoppel. Although no point of error is directed toward estop-pel, Cunniff’s brief is replete with assertions that at least some element of estoppel has been shown and that this is sufficient for the application of laches.

•We have carefully reviewed the record in this case. We conclude that, although there may be some evidence which might support the finding of some element of estoppel, reasonable minds could differ. However, the conclusion made upon facts, that estop-pel was not shown, is certainly not so against the great weight and • preponderance of the evidence as to be manifestly wrong and unjust. Certainly it was not an abuse of discretion for the trial court to conclude that even though there was an agreement, Mrs. Johnson was not estopped from prosecuting her motion to reduce to judgment.

Although we have not discussed each of appellant’s points of error, each point presented in complaint of the trial court’s judgment has been severally considered and each is overruled. The trial court did not abuse its discretion.

The judgment of the trial court is affirmed.


author: O’QUINN, Justice.

text:
    CITY OF EL PASO, Texas, et al., Appellants, v. PUBLIC UTILITY COMMISSION of Texas, et al., Appellees.
    No. 12971.
    Court of Civil Appeals of Texas, Austin.
    July 11, 1979.
    Rehearing Denied July 25, 1979.
    Larry A. Baskind, Diamond, Rash, Leslie & Smith, El Paso, for appellants.
    Mark White, Atty. Gen., Joyce Beasley, Asst. Atty. Gen., Austin, for Public Utility Commission.

      David H. Wiggs, Jr., Michael D. McQueen, Kemp, Smith, White, Duncan & Hammond, El Paso; and Barry K. Bishop, Clark, Thomas, Winters & Shapiro, Austin, for El Paso Elec. Co.
   O’QUINN, Justice.

From judgment of the district court approving in substantial part an order of the Public Utility Commission under which the El Paso Electric Company was granted a rate increase, the City of El Paso and the City of Anthony, municipalities served by the electric company, have appealed and bring two points of error.

Appellants contend that (1) it was error to affirm action of the Commission by which $306,899.00 of electric plant held for future use was included in the rate base, and (2) error to affirm the Commission order setting a rate higher than the maximum rate provided in the franchise agreement between the City of El Paso and the electric company. We will overrule both points of error and affirm the judgment of the trial court.

Appellants argue that only property “used and useful” in providing service should be included in the rate base, but concede that there can be exceptions to the rule.

The property held for future use, as scheduled by El Paso Electric Company under the uniform accounting system adopted and required by rules of the Utility Commission, consisted of six plots of land, five of which lie in El Paso County. The total value shown by the schedule was $396,-819.00. In its findings of fact, the Commission listed, as an adjustment to be included in the rate base, “Electric plant held for future use” at a total of $306,899.00.

To this listing was added the statement, “Electric plant held for future use is included as it constitutes property purchased by the company in anticipation of future needs and as such will ultimately result in more savings to its ratepayers than if all plant were purchased for immediate use only.”

To be classified in the accounting system, “Electric Plant Held for Future Use” must meet the definition prescribed: “This account shall include the original cost of electric plant (except land and land rights) owned and held for future use in electric service under a definite plan for such use. . This account shall also include the original cost of land and land rights owned and held for future use in electric service under a plan for such use . . . ”

A witness for the electric company, qualified as a rate engineer, testified at the rate hearing, “Plant held for future use was allocated on the basis of demand responsibility since the plant so classified consists primarily of sites for future transmission and generation site.” The listing found in the findings of fact, already referred to, would indicate that the Commission, upon considering the potential uses to be made of the sites, determined that the property should be included in the rate base.

Appellants find comfort in language of the Supreme Court in Southwestern Bell Telephone Company v. Public Utility Commission, 571 S.W.2d 503, 516 (Tex.1978), where the Court said, “In the future, the Commission should consider the nature and present usefulness of the parcels of land and determine whether or not such property should be included in the rate base.” The Court there was not reviewing a substantial evidence point of error, which is the issue in this appeal.

We are of the view that the Commission’s finding, to include the land sites in the rate base, was supported by substantial evidence. In review of an administrative proceeding, as pointed out by the Supreme Court in 1977, “ . . .it has not taken much evidence under our decisions to qualify as substantial. In fact, the evidence may be substantial and yet greatly preponderate the other way.” Lewis v. Metropolitan Savings and Loan Association, 550 S.W.2d 11, 13 (Tex.1977).

The Court, in Southwestern Bell, also said that the Commission had “ . . . erred in its blanket exclusion of this property from the rate base. However, we do not consider such action, under the record, confiscation.” As pointed out in a dissenting opinion, the majority of the Court considered the value of the land excluded too small to render the rate, arrived at without that land in the rate base, confiscatory or unreasonably inadequate.

In this lawsuit the situation is reversed, where the contested sum of $306,899 was added, not excluded, and the total rate base was determined to be $157,894,307. In Southwestern Bell the property omitted had a value of $1,136,000, whereas the total rate base amounted to $3,000,000,000. In the present case, the property included was about 2/ioth of one percent of the total rate base.

The Supreme Court in Southwestern Bell considered the reduction of the telephone company’s rate, by reason of “blanket exclusion” of $1,136,000 from the rate base of three billion dollars, so inconsiderable as not to amount to confiscation, and by implication applied the principle of “De minimis non curat lex,” usually translated to say, “The law does not notice trifling matters.” We consider the principle of de minimis appropriate in this case and conclude that by including the disputed $308,899 in the rate base, an amount was added which was so minimal as not to result in a rate to the consumer that was exorbitant, unreasonable, oppressive, unfair, unjust, or unlawful. The first point of error is overruled.

Under their second point of error appellants contend that the franchise contract between the City of El Paso and the El Paso Electric Company should prevail to prevent rate schedules “higher than the corresponding lowest rate schedules at any other point served by the Company’s system,” which the rates set by the Commission would permit.

The trial court found that the Commission’s order “ . . . effectively held that the rates provided for [in the order] were controlling over the Franchise Agreement . . . ” The trial court adjudged that the franchise agreement “ . . . does not serve to limit the power of the . . . Commission ... to set just and reasonable rates, and when established, said rates shall take precedence over franchise rates and be the rates actually imposed and placed into effect.”

The City Council of the City of El Paso, in March of 1971, passed an ordinance granting a franchise to the El Paso Electric Company, which the company accepted. Provision was made in the franchise that “The rate schedules in the City of El Paso shall never be higher than the corresponding lowest rate schedules at any other point served by the Company’s system.” The City contends that the rates fixed by the Commission, if charged by the electric company, will be in excess of the “corresponding lowest rate schedules” at other points served by the company, and therefore in violation of the franchise agreement.

Constitutional control of privileges and franchises granted by the Legislature, or created under its authority, was established for the first time in Texas under the Constitution of 1876. The final portion of Section 17, Article I, of the Constitution provides: “ . . .no irrevocable or uncontrollable grant of special privileges or immunities, shall be made; but all privileges and franchises granted by the Legislature, or created under its authority shall be subject to the control thereof.”

It is settled that cities have no inherent power to regulate rates of public utilities, and such powers as municipalities do exercise in rate making must be conferred by the State. Southwestern Bell Telephone Company v. Houston Independent School District, 397 S.W.2d 419, 421 (Tex.1965); Texas-Louisiana Power Company v. City of Farmersville, 67 S.W.2d 235, 238 (Tex.Comm’n App.1933); State v. Lone Star Gas Company, 86 S.W.2d 484, 497 (Tex.Civ.App. Austin 1935, writ ref’d), reversed on other grounds, 304 U.S. 224, 58 S.Ct. 883, 82 L.Ed. 1304 (1938).

With passage of the Public Utility Regulatory Act in 1975 (Art. 1446c, V.A.T.S.), exclusive appellate jurisdiction in rate making matters was vested by the Legislature in the Public Utility Commission, to which the Legislature delegated such power. Section 21 of the Utility Act preserved the right of municipalities to grant or refuse franchises to use the streets and alleys, “ . . . but no provision of any franchise agreement shall limit or interfere with any power conferred on the commission . . . ” including rate making powers.

It is clear from the Utility Act that the Legislature intended that franchise agreements, tending to interfere with the power to determine rates, would be ineffective and in no way controlling in the rate making process. The El Paso franchise contract with the electric company was made subject to the paramount constitutional authority of the Legislature to regulate utilities and determine rates to be charged by utilities, inasmuch as such contracts may be superseded at any time by the Legislature, or the Commission, as the authorized agency of the Legislature. General Telephone Company of the Southwest v. City of Perryton, 552 S.W.2d 888, 891 (Tex.Civ.App. Amarillo 1977, writ ref’d n. r. e.); City of Wink v. Wink Gas Company, 115 S.W.2d 973, 976 (Tex.Civ.App. El Paso 1938, writ ref’d).

We have examined with care the several authorities relied upon by appellants under which appellants urge that the Commission was bound to make findings that setting aside the franchise provision, purportedly fixing a maximum for rates charged by the electric company, was in the public interest.

We conclude that ample authority is given the Legislature under the Constitution to delegate to the Commission power to determine rates under the Utility Regulatory Act, and to disregard the franchise as interfering with such power, without the necessity of an affirmative finding that to do so was in the public interest. The Legislature declared in the Utility Act that it was “ . . . enacted to protect the public interest inherent in the rates and services of public utilities . . .” (Sec. 2, Art. 1446c, emphasis added). Point of error two is overruled.

The judgment of the trial court is in all things affirmed.

Affirmed.

      . Minimis, genitive of minimus, the superlative of parva (small); “de minimis” thus literally means “of the least of the small.”