text:
    John CHILDS et al., Appellants, v. REUNION BANK and Charles N. Brewer, Appellees.
    No. 19961.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 6, 1979.
    Rehearing Denied Sept. 10, 1979.

      Henry M. Wade, Dist. Atty., Charles Bowling, Jr., Asst. Dist. Atty., Dallas, for appellants.
    Before AKIN, ROBERTSON and HUM-PHREYS, JJ.
   AKIN, Justice.

This is an appeal by the Tax Assessor-Collector and the Board of Equalization of Dallas County from a permanent injunction commanding them to desist from assessing or collecting 1977 and 1978 ad valorem taxes on the stock of Reunion Bank. The suit was brought by appellee bank as agent for its shareholders and by appellee Charles N. Brewer, a shareholder and president of the bank and representative of a class consisting of all its shareholders. The trial court held that appellants’ tax scheme was arbitrary, deliberate, and erroneous, and enjoined its implementation as to these taxpayer-plaintiffs. The tax collector raises four principal contentions on appeal. First, he claims the trial court erred in denying appellants’ plea that this suit for injunction was filed too late because the tax plan had already been put into effect. Secondly, he contends the trial court erred in granting the injunction because the taxpayers did not sustain their burden of proof, they did not seek to do equity, and the injunction constituted an improper tax exemption for appellees. Thirdly, the tax collector maintains the trial court erred in denying his request for a jury trial, and lastly, the trial court erred in assessing court costs against him. We overrule the tax collector’s contentions and affirm the trial court’s judgment.

This is the second suit enjoining the tax collector from collecting ad valorem taxes under Tex.Rev.Civ.Stat.Ann. art. 7166 (Vernon 1960) on the shares of Reunion Bank. Article 7166 provides as follows:

Every banking corporation, State or national, doing business in this State shall, in the city or town in which it is located, render its real estate to the tax assessor at the time and in the manner required of individuals. At the time of making such rendition the president or some other officer of said bank shall file with said assessor a sworn statement showing the number and amount of the shares of said bank, the name and residence of each shareholder, and the number and amount of shares owned by him. Every shareholder of said bank shall, in the city or town where said bank is located, render at their actual value to the tax assessor all shares owned by him in such bank; and in case of his failure so to do, the assessor shall assess such unrendered shares as other unrendered property. Each share in such bank shall be taxed only for the difference between its actual cash value and the proportionate amount per share at which its real estate is assessed. The taxes due upon the shares of banking corporations shall be a lien thereon, and no banking corporation shall pay any dividend to any shareholder who is in default in the payment of taxes due on his shares; nor shall any banking corporation permit the transfer upon its books of any share, the owner of which is in default in the payment of his taxes upon the same. Nothing herein shall be so construed as to tax national or State banks, or the shareholders thereof, at a greater rate than is assessed against other moneyed capital in the hands of individuals.

In the first suit the bank successfully enjoined the tax collector from collecting the taxes from the bank. The tax collector then attempted to collect the tax from the individual shareholders, and these taxpayers brought this suit.

The tax collector’s first contention is that the trial court erred in failing to hold that the suit was filed too late. He claims that the taxpayers’ suit for injunction was not filed until after the county’s tax scheme had been certified and a substantial amount of taxes had been collected. He cites City of Arlington v. Cannon, 153 Tex. 566, 271 S.W.2d 414, 416-17 (1954), for the proposition that the remedies of mandamus and injunction are lost to a taxpayer challenging a taxing plan if they are not asserted before the taxing authority puts the plan into effect. The Cannon court held as follows:

In the recent case of State v. Whittenburg [, Tex.Sup., 265 S.W.2d 569] . we recognized the right to relief from such an arbitrary plan of taxation. However, if the taxpayer fails to avail himself of the remedies of mandamus and injunction to prevent a taxing authority from putting such a plan into effect, . his right to relief is limited Once such a plan is put into effect the litigant may defeat the recovery of taxes only to the extent that they are excessive and he must assume the burden of proving excessiveness . . . The difficulties to be encountered in making the necessary proof as a basis for relief is the penalty the taxpayer must pay for sitting idly by while taxing authorities put into effect a plan of taxation which deliberately permits certain classes of property to escape taxation. 271 S.W.2d at 416-17 [Emphasis added]

We cannot agree that the case here falls within the ambit of the rule enunciated in Cannon with respect to appellees’ property because the record before us shows that appellees were diligent at all times under the standard set forth in Cannon. Under the rationale of Cannon, the taxpayer must lack diligence before that rule is applicable. In our case, the shareholders received their tax notices in January 1978. Appellee Charles N. Brewer obtained permission on May 31, 1978, to appear before the Board of Equalization, individually and on behalf of all shareholders, in the Board’s first series of meetings in July. At his appearance Brewer presented a position paper explaining the nature of his complaint against the county’s tax scheme. The tax scheme had not yet been certified or implemented. After his appearance, Brewer understood that the Board of Equalization would seek an attorney general’s opinion before approving the enrollment of the tax against the bank stock, and would not place the Reunion Bank shares on the taxrolls unless the attorney general so advised. Immediately after Brewer’s appearance, he met with the tax collector who agreed not to enroll the Reunion Bank shareholders on the taxrolls until an attorney general’s opinion on the legality of the tax scheme was obtained. A second meeting confirming this agreement was held on or about August 15, 1978.

Notwithstanding these assurances, on September 29, 1978, Brewer received a tax statement for ad valorem taxes on the bank shares. This was his first notification since his appearance before the Board of Equalization that the contested tax scheme would be implemented. He immediately directed his attorney to bring this lawsuit, which was filed on October 5, 1978. Although implementation of the tax scheme had already begun at this filing, we hold that the taxpayers’ diligence, coupled with their invited reliance on the appellants’ representations, takes this case out of the rule announced in Cannon. Consequently, these taxpayers still had the remedy of injunction available to them, and they had no burden to show excessiveness in attacking the tax scheme.

To hold otherwise would place these taxpayers in an unjust dilemma. See Burklund v. Hackett, 575 S.W.2d 389, 393 (Tex.Civ.App.—Tyler 1978, no writ). If they had brought suit prior to notification that the taxing authorities were going to proceed with their tax scheme, in other words, during the time when the tax collector’s agreement not to proceed with the tax scheme was still in effect, the injunction would have been premature since there was no probability of substantial injury to the taxpayers. The tax collector, however, would have us hold that these taxpayers have waived their injunction remedy by not bringing a premature injunction action. Such a ruling would allow taxing authorities to escape any injunction or mandamus attack on their taxing schemes by promising not to implement the scheme against the complaining taxpayer until such a time as the scheme has already been certified and implemented against other noncom-plaining taxpayers. We note that the taxpayers filed suit within a week of notification that the tax scheme was being implemented. In view of the promises by the taxing authorities and the continuing diligence of these taxpayers in challenging this tax scheme, they were not required to do more than is shown in this record to preserve their right to injunctive relief. Where a taxpayer challenges the imposition of taxes upon his property in a direct attack upon a constitutional infirmity and prosecutes his suit with diligence, nothing further is required. Burklund v. Hackett, 575 S.W.2d 389, 393 (Tex.Civ.App.—Tyler 1978, no writ); Atlantic Richfield Co. v. Warren Ind. School Dist., 453 S.W.2d 190, 196 (Tex.Civ.App.—Beaumont 1970, writ ref’d n.r.e.). We hold, therefore, that the tax collector’s plea in bar was properly denied.

The tax collector’s second contention is that the injunction was improper. Specifically, he claims that the taxpayers failed to carry their burden of proof, that they did not seek to do equity, and further, that the injunction constituted an improper tax exemption for these taxpayers. We turn first to the sufficiency of the proof offered by the taxpayers.

Whether injunctive relief is sought before or after an assessment plan is put into effect, the taxpayers must show that the plan is illegal. They must also show a likelihood of substantial injury; that is, they must show that the plan would discriminate against them by deliberately assessing their property at a greater percentage of its true value than the percentage assessed for other properties subject to the tax. City of Arlington v. Cannon, 153 Tex. 566, 271 S.W.2d 414, 417 (1954); Lancaster Ind. School Dist. v. Pinson, 510 S.W.2d 380, 383 (Tex.Civ.App.—Dallas 1974, writ ref’d n.r.e.). If the plan wholly excludes some classes of property from the assessment rolls, injury from such a plan may be shown without establishing the market value of the plaintiffs’ property. Lancaster Ind. School Dist. v. Pinson, 510 S.W.2d 380, 383 (Tex.Civ.App.—Dallas 1974, writ ref’d n.r.e.). The record shows, by the tax collector’s own testimony, that numerous classes of taxable property were wholly and deliberately excluded from the taxrolls. This testimony is sufficient under the above authorities to show that the assessments against these taxpayers were discriminatory and to relieve them of the burden of establishing the market value of their property.

Furthermore, the tax collector’s testimony establishes that the taxing scheme is illegal; The last sentence of article 7166 provides that “Nothing herein shall be so construed as to tax national or State banks, or the shareholders thereof, at a greater rate than is assessed against other moneyed capital in the hands of individuals.” (Emphasis added). The tax collector testified that no intangible personal property in Dallas County is taxed except for bank stock, and no other moneyed capital in the hands of individuals is taxed. Individuals are not asked to render or pay taxes on any of their moneyed capital other than bank stock or on various types of tangible personal property. A tax scheme that levies against only one type of moneyed capital, bank stock, while not levying against any other moneyed capital in the hands of individuals is in obvious violation of article 7166. We hold, therefore, that the taxpayers sustained their burden to show that the taxing scheme was illegal.

The tax collector also claims that the taxpayers did not show the likelihood of a sufficient substantial injury to entitle them to an injunction. The trial court found that the injury would have been between $2,669.00 and $8,007.00. The tax collector points out that this was the total potential injury to 163 shareholders, and that about 68% of the stockholders faced losses ranging from $6.67 to $20.02. He argues that such small sums were not sufficient injuries to justify the injunction. We cannot agree. The taxpayers had the burden to show the likelihood of a substantial injury, Lancaster Ind. School Dist. v. Pinson, 510 S.W.2d 380, 383 (Tex.Civ.App.—Dallas 1974, writ ref’d n.r.e.), which they sustained by proving that the taxing scheme was discriminatory and that a total injury of between $2,699.00 and $8,007.00 would result. This was sufficient, even in view of the fact that 163 shareholders made up the class of plaintiffs. The tax collector cites no authority to support his position that a class of taxpayers challenging a taxing scheme should not be allowed to aggregate their injuries in order to show the likelihood of a substantial injury. Indeed, a substantial injury is shown, as a matter of law, by appellants’ discriminatory taxing scheme. Accordingly, we overrule the tax collector’s complaint on this ground and hold that substantial injury has been shown.

The tax collector next argues that the appellees should not be granted an injunction because they failed to do equity in that they did not voluntarily render their personal property for taxing purposes. There is no evidence in the record to support this contention. Furthermore, the tax collector did not raise this point in the trial court and he cannot now raise it for the first time on appeal. Department of Mental Hygiene v. Bank of the Southwest, 163 Tex. 314, 354 S.W.2d 576, 581 (1962).

The tax collector’s final attack on the injunction is that the injunction granted an illegal exemption from taxation. We disagree. A taxpayer’s right to an injunction, when timely filed, against an illegal tax scheme is well-established where the tax scheme is discriminatory and the taxpayer can show that it will cause him a substantial injury. City of Arlington v. Cannon, 153 Tex. 566, 271 S.W.2d 414, 416 (1954); Atlantic Richfield Co. v. Warren Ind. School Dist., 543 S.W.2d 190 (Tex.Civ.App.—Beaumont 1970, writ ref’d n.r.e.); City of Houston v. Baker, 178 S.W. 820, 824 (Tex.Civ.App.—Galveston 1915, writ ref’d).

The tax collector’s third contention attacks the trial court’s refusal to grant his motion for a jury trial. He filed his jury demand seven days before the date of trial. Thus, his request was not made within the ten-day period prior to trial provided by Tex.R.Civ.P. 216. The general rule is that a party has a right to a trial by jury even though the jury fee is paid late, if a jury panel is available, unless it causes a postponement of the trial and unless it causes an undue interference with the handling of other business of the court. Erback v. Donald, 170 S.W.2d 289, 294 (Tex.Civ.App.—Fort Worth 1943, writ ref’d w.o. m.). When a demand for a jury fails to comply with Rule 216 in that the fee is paid late, the trial judge has discretion to deny a jury and on appeal the burden is on the appellant to show an abuse of that discretion. Wooten v. Dallas Fishing and Hunting Club, 427 S.W.2d 344, 346 (Tex.Civ.App.—Dallas 1968, no writ); Aronoff v. Texas Turnpike Authority, 299 S.W.2d 342, 344 (Tex.Civ.App.—Dallas 1957, no writ). Since there is nothing in the record to show any of the circumstances surrounding the denial except that the request was denied and that the motion did not comply with Rule 216, no reversible error is shown. Aronoff v. Texas Turnpike Authority, 299 S.W.2d 342, 344 (Tex.Civ.App.—Dallas 1957, no writ); Lebman v. Sullivan, 198 S.W.2d 280 (Tex.Civ.App.—San Antonio 1946, writ ref’d n.r.e.).

In his final contention, the tax collector argues that the trial court erred in' taxing costs against him. He argues that under article 7297 and section 6 of article 7345b, Tex.Rev.Civ.Stat.Ann. (Vernon 1960), costs may not be assessed against taxing authorities that bring suit to collect delinquent taxes. Ordinarily, in the absence of a statute exempting a governmental unit from the payment of court costs, it is liable just as any other litigant. Ibanez v. State, 123 S.W.2d 704 (Tex.Civ.App.—El Paso 1938, no writ); Reed v. State, 78 S.W.2d 254, 257 (Tex.Civ.App.—Austin 1934, writ dism’d). The statutes urged here by appellants are not applicable to this suit, which is a suit brought by taxpayers to enjoin collection of an illegal tax. Consequently, the trial judge did not err in assessing costs against the tax collector. City of Amarillo v. Paramount Terrace Christian Church, 530 S.W.2d 323, 324 (Tex.Civ.App.—Amarillo 1975, writ ref’d n.r.e.); Glass v. Great Southern Life Insur. Co., 170 S.W.2d 247 (Tex.Civ.App.—Galveston 1943, writ ref’d w.o.m.).

Affirmed.


source: Caselaw Access Project

author: STOREY, Justice.

license: Public Domain

text:
    Joyce DUNCAN, Appellant, v. John HORNING, D. D. S., Appellee.
    No. 19918.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 7, 1979.

      Charles M. Wilson, III, Carter, Jones, Magee, Rudberg, Moss & Mayes, Dallas, for appellant.
    John H. Martin, Thompson & Knight, Dallas, for appellee.
    Before GUITTARD, C. J., and STOREY and HUMPHREYS, JJ.
   STOREY, Justice.

This is an appeal from a summary judgment granted in a dental malpractice suit. The primary question is whether the affidavit of an expert witness who is a party to the suit may constitute sufficient proof to support summary judgment. We hold that it can. We also conclude that plaintiff’s controverting affidavits are not sufficient to raise a fact issue; and that her answers to interrogatories may not be used by her to raise a fact question. Accordingly, we affirm.

Plaintiff sued the defendant, a dentist who had been treating her for about seven years, alleging eight grounds of negligence: (1) he failed to properly diagnose her tooth and jaw prior to extraction; (2) he failed to obtain a medical history; (3) he failed to use clean instruments; (4) he administered excessive anesthetics; (5) he failed to properly treat the wound after extraction; (6) he pulled an infected tooth; (7) he failed.to offer her alternatives to extraction; and (8) he failed to properly care for her teeth during the years of treatment. Defendant answered and propounded interrogatories to plaintiff. Among those interrogatories was a series of questions inquiring about plaintiff’s expert witness or witnesses. Plaintiff’s answers revealed that she had no expert testimony to offer, whereupon defendant filed his motion for summary judgment accompanied by his supporting affidavit. On the day before the summary judgment hearing, plaintiff filed controverting affidavits, one signed by her and one signed by Dr. Glenn Clark. The trial court, after considering the summary judgment record, granted defendant’s motion.

The first question is whether an interested expert witness, the defendant in a malpractice case, can obtain summary judgment based solely on his uncontroverted testimonial evidence. We have concluded that he can. Rule 166-A(c), as amended effective January 1, 1978, provides in part:

A summary judgment may be based on uncontroverted testimonial evidence of an interested witness, or of an expert witness as to subject matter concerning which the trier of fact must be guided solely by the opinion testimony of experts, if the evidence is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and could have been readily controverted. [Emphasis added].

Prior to the 1978 amendment, the rule did not expressly authorize the consideration of either the testimonial evidence of an interested witness or the opinion of an expert in support of a motion for summary judgment. The supreme court’s construction of the rule, however, had authorized use of the interested witness’ evidence, under certain conditions, while denying that a summary judgment could be based on expert opinion testimony under any conditions. Gibbs v. General Motors Corp., 450 S.W.2d 827 (Tex.1970); Great American Reserve Insurance Co. v. San Antonio Plumbing Supply Co., 391 S.W.2d 41, 47 (Tex.1965). The conditions authorizing consideration of the interested witness’ testimony as set out in Great American Reserve Insurance Co. are that it be uncontradicted, clear, direct and positive, free of circumstances tending to discredit or impeach, and readily controverted. These are the tests which our courts have traditionally applied to an interested witness’ testimony, whether in summary judgment proceedings or in jury or non-jury trials, involving the question of whether a fact is established or negated as a matter of law. Great American Reserve Insurance Co., supra; Valley Stockyards Co. v. Kinsel, 369 S.W.2d 19, 20 (Tex.1963); Taylor and Son, Inc. v. Arlington Independent School District, 160 Tex. 617, 335 S.W.2d 371, 376 (1960); Owen Development Co. v. Calvert, 157 Tex. 212, 302 S.W.2d 640, 642 (1957); McGuire v. City of Dallas, 141 Tex. 170, 170 S.W.2d 722, 728 (1943); Simonds v. Stanolind Oil & Gas Co., 134 Tex. 332, 136 S.W.2d 207, 208 (1940). The amended rule expressly provides for the consideration of both types of testimony in support of a motion for summary judgment and places the same conditions upon their use. Additionally, the expert opinion is limited to subject matter concerning which the trier of fact must be guided solely by the opinion testimony of an expert.

We find nothing in the language of the amended rule which prohibits an interested witness from giving an expert opinion. Because the supreme court was considering both types of testimonial evidence at the same time for inclusion in the rule, we must conclude that it intended the opinion of an interested expert to be competent summary judgment proof; otherwise the amendment would have contained an express prohibition. The question then is whether the affidavit in this case meets the tests required by the rule.

The defendant’s affidavit sets out his qualifications, describes the services he performed for plaintiff, states that he acted in accordance with the standard of care prevalent in Dallas County, specifically denies each of the allegations of negligence contained in plaintiff’s petition and states the opinion based upon a reasonable degree of dental probability, that no act or omission on his part caused any damage to plaintiff. The evidence furnished by the affidavit is clear, positive and direct, otherwise credible and free from contradictions and inconsistencies, and the subject matter is such that the trier of fact must be guided solely by the opinion testimony of an expert. Hart v. Van Zandt, 399 S.W.2d 791, 792 (Tex.1965); Bowles v. Bourdon, 148 Tex. 1, 219 S.W.2d 779, 782 (1949).

The remaining test required by Rule 16fr-A(c) is whether the defendant’s testimonial evidence “could have been readily controverted.” Plaintiff made no complaint to the trial court that she was unable to controvert. We believe the better practice would require plaintiff to make such a complaint under subdivision (f) of Rule 166-A; however, the Supreme Court has never placed this burden upon a non-movant, but instead has made its own determination from the record before it. See Great American, 391 S.W.2d at 47; Kinsel, 369 S.W.2d at 20; Arlington, 335 S.W.2d at 376; Calvert, 302 S.W.2d at 642; McGuire, 170 S.W.2d at 728; Simonds, 136 S.W.2d at 208. Further, the court has never defined “readily controverted.” There is some authority for the proposition that it means only the opportunity to controvert. (See Simonds, 136 S.W.2d at 208 where the court said the opposing party had the opportunity because he took the witness’ deposition prior to trial). The weight of authority seems to be, however, that there must not only be the opportunity to controvert, but also the testimony must be such that it is susceptible of controverting. See Great American, supra; Kinsel, supra; See also Collora v. Navarro, 574 S.W.2d 65, 69 (Tex.1978). Plaintiff in this case had the opportunity to controvert as demonstrated by her filing of Dr. Clark’s affidavit. Also, defendant’s testimonial evidence was susceptible of controverting. However, Dr. Clark was apparently not furnished with sufficient discoverable information about defendant’s records, procedures and treatment to express a specific opinion; but instead, for lack of sufficient information, was able to make only the general statements found in his affidavit. We conclude that in this case, the statements in defendant’s affidavit could have been readily controverted, and, therefore are sufficient to negate a fact issue unless controverting summary judgment proof is presented. Consequently, we must consider whether plaintiff’s summary judgment proof raises a fact issue.

Plaintiff’s personal controverting affidavit is insufficient to raise a fact issue because she makes medical conclusions about defendant’s medical treatment and standard of care which she is not qualified to make. Mere conclusions of a lay witness are not competent evidence and therefore cannot be considered for the purpose of controverting expert opinion evidence. Tex.R.Civ.P. 166-A(e); Hart v. Van Zandt, 399 S.W.2d 791, 792 (Tex.1965); Bowles v. Bourdon, 148 Tex. 1, 219 S.W.2d 779, 782 (1949). The testimonial evidence offered by Dr. Glenn Clark, plaintiff’s expert witness, is also insufficient. His affidavit addresses in general terms only two of the acts alleged by plaintiff to constitute negligence. His opinion was that the general dentistry work received by plaintiff over the past few years would probably not meet the average standards because several teeth were extracted without replacement of prosthesis and several large fillings had massive overhangs. Neither of these acts or omissions were attributed to the work done by defendant, and the record shows that defendant extracted only one tooth; and, further, that other dentists had performed general dentistry work for plaintiff. Dr. Clark also stated that a proper standard of care prior to extraction would be to inform a patient of possible alternatives. These alternatives, according to the affidavit of Dr. Clark, were immediate extraction or the performance of a root canal. While there is some evidence that the defendant failed to offer alternatives to plaintiff, there is no evidence that defendant was negligent in his choice of one of the alternatives, or that there was any causal connection between his failure to advise of the alternative and the injury allegedly sustained by plaintiff. The affidavit of Dr. Clark contains no statement that in reasonable medical probability there was any causal connection between any act or omission on the part of the defendant and plaintiff’s alleged injury. Plaintiff must show that the diagnosis or treatment complained of was performed in a negligent manner and that such negligence was the proximate cause of her injuries. Bowles v. Bourdon, 148 Tex. 1, 219 S.W.2d 779, 782 (1949).

Plaintiff further contends that the two controverting affidavits together with her answers to defendant’s written interrogatories are sufficient to controvert defendant’s motion for summary judgment. Tex.R.Civ.P. 168 provides that answers to interrogatories can be used only against the party filing answers. See Jeffrey v. Larry Plotnick Co., Inc., 532 S.W.2d 99, 102 (Tex.Civ.App.—Dallas 1975, no writ). Plaintiff argues that because defendant relied on the interrogatories as part of his summary judgment proof, the court should consider them as a part of plaintiff’s opposing summary judgment proof as well, relying upon General Plywood Corp. v. Collins, 414 S.W.2d 224 (Tex.Civ.App.—Amarillo 1967, no writ). Plaintiff’s reliance on General Plywood Corp. is misplaced. In that case, the court considered the opposing party’s answer as part of the summary judgment proof and concluded that the answers were insufficient to show absence of a fact issue. That case does not stand for the proposition plaintiff suggests, and we therefore do not consider plaintiff’s answers to interrogatories as part of her response to the motion for summary judgment.

Because we conclude that plaintiff’s affidavits are insufficient and that the interrogatories may not be considered in determining whether a fact issue exists, it follows that the trial court properly granted defendant’s motion for summary judgment.

Affirmed.

      . Subdivision (f) provides: Should it appear from the affidavits of a party opposing the motion that he cannot for reasons stated present by affidavit facts essential to justify his opposition, the court may refuse the application for judgment or may order a continuance to permit affidavits to be obtained or depositions to be taken or discovery to be had or may make such other order as is just.


author: CARVER, Justice.

text:
    William R. GIFFORD, Appellant, v. James A. SULLIVAN, Appellee.
    No. 19905.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 8, 1979.
    Royal H. Brin, Jr., Strasburger & Price, Dallas, for appellant.
    Don W. Davis, Collie, McSpedden, Roberts & Davis, Dallas, for appellee.
    Before AKIN, ROBERTSON and CARVER, JJ.
   CARVER, Justice.

This is an appeal from the refusal of the trial court to set aside a judgment granted when appellant was “in default of appearance for trial.” We hold the trial court erred in failing to set aside the judgment when the record reflected the failure of appellant to appear for trial was not deliberate or the result of conscious indifference, and appellant had set upon in his pleadings a meritorious defense. Accordingly, we reverse and remand for trial.

Appellee filed his suit on the 26th day of June, 1978, and, after some delay, service was perfected, defendant answered and appellee’s amended petition was filed October 28, 1978. The cause was set for trial on its merits for the 2nd day of November, 1978. The day before trial, the appellant, a licensed attorney representing himself, called the attorney for appellee and discussed the shortness of time between the commencement of the suit and the trial setting together with the absence of an opportunity for discovery. The conversation concluded with agreement that the first setting of the cause would be postponed by consent of the parties and that the attorney for appellee would not demand or require a motion for continuance to be filed. The following morning, the day of trial, appellant nevertheless prepared and filed a motion for continuance, and appeared personally at the courtroom. The appellant tendered his motion to the clerk and advised her that his opposing counsel offered no contest to the motion whereupon appellant left the courthouse for other business. Late on the afternoon on the day of trial, the court reached the case, called it, and appellee answered with a report to the court of appellant’s filing of his motion for continuance with the clerk, appellant’s verbal recitation of the agreement, and appellant’s departure from the courthouse. The trial court overruled the motion for continuance and, without any effort to advise appellant of the court’s ruling on the motion, proceeded to the trial as if appellant were “in default of appearance for trial.” Upon learning of the entry of judgment, appellant filed his motion for new trial and an amended motion for new trial, supported by affidavit, showing substantially the above facts and urging that his absence from the trial was not deliberate or the result of conscious indifference, but was solely in reliance upon his agreement with appellee’s counsel that the cause be continued. The trial court refused to set aside the judgment and this appeal follows.

In Ivy v. Carrell, 407 S.W.2d 212 (Tex. 1966), our Supreme Court held that the same rule applied to “default in appearance for trial” cases as was applied to “default in answer” cases as reflected in Craddock v. Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124, 126 (1939). As the Court said:

A default judgment should be set aside and a new trial ordered in any case in which the failure of the defendant to answer before judgment was not intentional, or the result of conscious indifference on his part, but was due to a mistake or an accident; provided the motion for a new trial sets up a meritorious defense and is filed at a time when the granting thereof will occasion no delay or otherwise work an injury to the plaintiff.

The facts as to appellant’s failure to appear for trial are undisputed. Although the judge may not have been bound by the agreement of counsel, appellant might reasonably have expected it to be honored in the absence of notice to the contrary. We conclude that appellant’s failure to appear in reliance on the agreement was not “intentional, or the result of conscious indifference.”

We turn now to the question of whether the appellant also “set up a meritorious defense”. The cause of action asserted by appellee against appellant was founded upon the appellant’s alleged membership in a joint venture. In his answer, appellant set up both a general denial to appellee’s allegations as well as a specific denial that the appellant was a member of the joint venture. In Ivy, our Supreme Court held that “set up a meritorious defense” meant “facts” in the pleadings, the truth of which will constitute a defense. Since appellant pled non-membership in the alleged joint venture, this was “a fact the truth of which would constitute a defense” to appellee’s whole case. Thus, appellant had set up a meritorious defense as required by Ivy.

Reversed and remanded.


text:
    James Herrin GRIFFIN, Temporary Guardian of the Estate of Willie Pearl Barr, Incompetent, Appellant, v. Willie Pearl BARR, Appellee.
    No. 19822.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 9, 1979.
    Rehearing Denied Oct. 1, 1979.
    John W. Henvey, Office of Timothy E. Kelley, Dallas, for appellant.
    Burt Berry, Dallas, for appellee.
    Before GUITTARD, C. J., and CARVER and HUMPHREYS, JJ.
   CARVER, Justice.

Following the termination of a temporary guardianship proceeding, a jury trial was conducted in the probate court to fix the reasonable and necessary expenses, including attorneys’ fees, to be allowed to the temporary guardian. The probate court entered its judgment on the jury’s verdict and the temporary guardian appeals. The temporary guardian asserts that the probate court erred in submitting the issues to the jury, in submitting the amount of attorney’s fees to the jury, and that, in any event, there was no evidence to support the jury’s findings. We affirm the trial court’s judgment on the grounds that the conduct of a trial on these issues was directed by the mandate following a prior appeal, that the right to trial by jury on issues at the request of either party was mandatory, and that the jury’s verdict was supported by the evidence.

A detailed history of the dispute leading to the present case may be gained from the prior appeal styled Barr v. Griffin, 554 S.W.2d 305 (Tex.Civ.App.—Waco 1977, no writ). Briefly, a daughter-in-law of the alleged incompetent instituted these proceedings and secured an ex parte appointment of a temporary guardian. By the time of the first evidentiary hearing, the parties were satisfied to announce to the court a settlement terminating the guardianship and reserving to the court the later determination of necessary expenses, including attorneys’ fees, incurred by the temporary guardian. The settlement was subsequently repudiated by the alleged incompetent. Nevertheless, the probate court entered its order fixing expenses and attorneys’ fees without any further agreement or evidence. On the former appeal, the trial court was directed to hear evidence on these issues, and we hold that there was no error in so doing.

The trial court in response to the prior mandate, and upon a timely jury demand by the alleged incompetent, tried the issues to a jury as directed by Tex.Prob. Code Ann. § 21 (Vernon 1973) which states:

In all contested probate and mental illness proceedings in the district court or in the county court or statutory probate court, county court at law or other statutory court exercising probate jurisdiction, the parties shall be entitled to trial by jury as in other civil actions.

Appellant asserts that, notwithstanding section 21, the particular issue of attorneys’ fees has been reserved to the “court,” meaning the trial judge as opposed to the jury, by Tex.Prob.Code Ann. § 242 (Vernon 1955) which states:

Personal representatives of estates shall also be entitled to all necessary and reasonable expenses incurred by them in the preservation, safe-keeping, and management of the estate, and in collecting or attempting to collect claims or debts, and in recovering or attempting to recover property to which the estate has a title or claim, and all reasonable attorney’s fees, necessarily incurred in connection with the proceedings and management of such estate, on satisfactory proof to the court. [Emphasis added].

The question presented to this court is whether the legislature, by amending section 21 of the Probate Code in 1973 to provide for trial by jury of “all contested probate and mental illness proceedings” in the probate court, intended to include all issues of fact previously tried “to the court” but appealable and triable de novo with a jury in the district court. We conclude that this was the evident legislative intent.

We note that before abolition of trials de novo, the practice in probate was well established to appeal and try in the district court issues concerning allowances for attorneys’ fees and other expenses of guardians and administrators. Salmon v. Salmon, 395 S.W.2d 29 (Tex.1965); Rowe v. Dyess, 213 S.W. 234 (Tex.Comm’n App. 1919, holding approved); Legler v. Legler, 189 S.W.2d 505 (Tex.Civ.App.—Austin 1945, writ ref’d w. o. m.); Dallas Joint-Stock Land Bank v. Maxes, 112 S.W.2d 305 (Tex.Civ.App.—Dallas 1937, no writ); Mathews v. Autry, 65 S.W.2d 798 (Tex.Civ.App.—Austin 1933, no writ); Morton’s Estate v. Ferguson, 45 S.W.2d 419 (Tex.Civ.App.—Eastland 1932, writ ref’d). In some of these cases, the issue of the amount of an attorney’s fee was submitted to the jury in the district court as in Salmon and Mathews. So far as we have been able to discover, this practice was never questioned. Presumably, the practice was familiar to the legislature in 1973 when it amended section 21 to provide for trials by jury in the probate court. No indication of an intent to restrict the issues to be tried by jury can be found in the 1973 statute. Indeed, an. intention not to impose such a restriction is made clear by the language granting that right in “all contested probate and mental illness proceedings.” Moreover, the phrase “to the court” in section 21 does not necessarily require trial by the judge without a jury because a jury, when demanded, is part of the court. Ex parte Lowery, 518 S.W.2d 897 (Tex.Civ.App.—Beaumont 1975, no writ). Accordingly, we hold that the trial court did not err in trying these issues to the jury.

No problem arises concerning legislative power to require a jury trial of these issues in view of our decision in Welch v. Welch, 369 S.W.2d 434 (Tex.Civ.App.—Dallas 1963, no writ). In that case, an attack was made on the constitutionality of a statute granting the right of trial by jury in child custody cases which had previously been tried by the judge without a jury. This court rejected that contention and held that where the legislature so directs, equity proceedings shall include a jury. Since a guardian is not a creature of equity, but one of statute, we have even less reason to avoid the legislative direction to provide for a jury trial in all contested probate and mental illness proceedings.

Appellants also urge, apart from a construction of the Probate Code, that a temporary guardian is to be likened to a receiver whose fees must be fixed by the court apart from the jury as prescribed by this court in Bergeron v. Sessions, 561 S.W.2d 551 (Tex.Civ.App.—Dallas 1978, writ ref’d n. r. e.). That case is distinguishable in the light of our discussion of the former trial de novo practice. Administrators and guardians who have been subject to detailed statutory regulation differ from receivers, who have always been supervised by the appointing court under the customs and usages of equity. The cited opinions show that the probate court’s control of administrators and guardians was not personal to the probate judge, but was subject to revision on appeal and trial de novo by the district court, sitting with a jury if demanded. Consequently, the considerations which led this court in Bergeron to deny the right to a jury trial with respect to the fees of receiver and his attorneys can have no application to personal representatives appointed under the provisions of the Probate Code.

As to the amount of the attorneys’ fees, the appellant asserts that the probate court’s fact finding as to reasonable attorneys’ fees in the earlier judgment was not challenged before the court of civil appeals in Barr; hence, upon remand, only the right to fees was the proper subject of trial. We conclude that the appellant has misread the opinion of the court in Barr. That court condemned any reliance upon the agreement of the parties concerning either the right to or the amount of fees, because the agreement had been repudiated. In particular, Barr held:

Although the judgment is dated January 15,1976, and recites that it was signed on April 23, 1976, the record shows without question that it was not actually rendered as to the amounts of attorneys’ fees awarded in it until the latter date. It must be reversed for two reasons: First, it is clear under the record that appellant never agreed to the amounts of attorneys’ fees allowed by the court. Second, before the judgment was finally rendered the court knew that appellant had disavowed her agreement to pay attorneys’ fees and that she had expressed dissatisfaction with the agreement to give up ownership of her certificates of deposit. [Emphasis added].

554 S.W.2d at 306-307. After the repudiation of the agreement, the probate court had neither the settlement nor any record which would support the assessment of a fee in any amount. The remand left for trial both the right to attorneys’ fees and expenses as well as the true amount thereof, in an adversary proceeding, in which either party was entitled to a jury upon demand.

Appellant further urges that there was “no evidence” to support the amount of the jury’s award in that the only testimony before the jury was the uncontested testimony of attorneys Kelly and Holloway, who gave opinions on amounts far in excess of the amounts awarded by the jury. Thus, it is urged that the amount of a proper attorneys’ fee was established conclusively by the evidence. O’Neil v. Mack Trucks, Inc., 542 S.W.2d 112 (Tex.1976). To the contrary, our Supreme Court has held that opinion evidence as to attorneys’ fees is not conclusive and it is the province of the jury to determine the reasonable value of an attorney’s services. Gulf Paving Co. v. Lofstedt, 144 Tex. 17, 188 S.W.2d 155 (1945). It is also the rule that attorneys testifying as to reasonable attorneys’ fees assessing their own work, and for whose benefit the award is sought, are “interested witnesses” whose “believability cannot be forced upon the jury.” Aetna Casualty & Surety Co. v. Moss, 336 S.W.2d 748 (Tex.Civ.App.—San Antonio 1960, no writ). The jury is free to believe all or none of such testimony or to accept it in part while rejecting another part. Freeman v. Shannon Construction, Inc., 560 S.W.2d 732 (Tex.Civ.App.—Amarillo 1977, writ ref’d n. r. e.). Since the jury had before it only the testimony of Kelly and Holloway and did award each of them a sum of money under a proper issue and instruction of the probate court, it is clear the jury did not reject all of their testimony, but neither did the jury believe all of their testimony. The jury believed some of the testimony of Holloway and Kelly resulting in their award. The appellant’s point of error is “no evidence” point and we conclude there was evidence by Kelly and Holloway to support the jury’s verdict. No point is urged invoking our fact jurisdiction to determine whether the verdict is against the great weight and preponderance of the evidence.

The judgment of the trial court is affirmed.

ON REHEARING

Appellant’s motion for rehearing reurges the point that the jury’s award of attorney’s fees is against the great weight and preponderance of the evidence. We have reviewed the record and we conclude that the jury’s verdict is not so against the great weight or preponderance of the evidence as to be manifestly unjust or clearly wrong, nor was the result of passion, prejudice, or improper motive, and that it was not in obvious conflict with justice so as to render it unconscionable. Simmes v. Price, Dallam Dig., 618 (Tex.1844); Bowen v. Merrit, Inc., 417 S.W.2d 313 (Tex.Civ.App.—Fort Worth, 1967, no writ).

Rehearing denied.


text:
    Chris JACOBSEN, Appellant, v. CITIZENS STATE BANK, Appellee.
    No. 19927.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 10, 1979.
    Rehearing Denied Sept. 17, 1979.
    Willard A. Herbert, Dallas, for appellant.
    John R. Stooksberry, Boyd, Veigel & Gay, Inc., McKinney, for appellee.
    Before AKIN, ROBERTSON and CARVER, JJ.
   CARVER, Justice.

This is an appeal from a summary judgment denying appellant Jacobsen any relief against Citizens State Bank, for an alleged invasion of privacy. We hold that a bank’s exhibition to an Internal Revenue agent of the transactions of a customer of the bank in response to a summons authorized by an act of Congress is not an invasion of privacy. Consequently, we affirm the judgment.

Jacobsen alleged in his petition and stated in his affidavit filed in opposition to the motion for summary judgment that he opened an account with the bank in 1975. At that time, he asserts he gave both oral and written instructions to the bank that his account was to be kept confidential between himself and the bank; additionally, handwritten instructions were given on the signature card which read “Transaction strictly confidential—available only to me.” In 1976, Jacobsen was notified that the Internal Revenue Service had issued a summons to the bank requiring the bank to appear before an agent named in the summons and to produce certain records pertaining to Jacobsen’s bank account and relating to his potential tax liability. Jacob-sen asked the bank to withhold the information unless required by a court order to comply. Disregarding this request, the bank complied with the summons and exhibited the records to the Internal Revenue Service.

Summary judgment was granted on the bank’s motion asserting that it had merely complied with a valid summons from the Internal Revenue Service as it was required to do by I.R.C. § 7602. Jacobsen appealed, contending that by turning over the records without a court order, the bank breached its contract with him and also violated its fiduciary and statutory duties of confidentiality thus invading his privacy.

We conclude that the depositor’s right of privacy is subordinate to the bank’s duty to comply with federal internal revenue laws. The right of the government to use the summons involved here and the citizens’ duty to respond is well established by statutory and case authority. The United States Internal Revenue Code, I.R.C. § 7602 provides, in pertinent part:

For the purpose of ascertaining the correctness of any return, making a return where none has been made, determining the liability of any person for any internal revenue tax or the liability at law or in equity of any transferee or fiduciary of any person in respect of any internal revenue tax, or collecting any such liability, the Secretary or his delegate is authorized—
(1) To examine any books, papers, records, or other data which may be relevant or material to such inquiry;
(2) To summon the person liable for tax or required to perform the act, or any officer or employee of such person, or any person having possession, custody, or care of books of account containing entries relating to the business of the person liable for tax or required to perform the act, or any other person the Secretary or his delegate may deem proper, to appear before the Secretary or his delegate at a time and place named in the summons and to produce such books, papers, records, or other data, and to give such testimony, under oath, as may be relevant or material to such inquiry; and
(3) To take such testimony of the person concerned, under oath, as may be relevant or material to such inquiry.

Under this section there is no legally recognized privilege entitling the bank to withhold such records on behalf of its depositor. United States v. Bremicker, 365 F.Supp. 701 (D.Minn.1973). A depositor’s threat to sue the bank on the loss of confidentiality, otherwise to be given the customer, is not a legal excuse for disobeying the summons. Ibid. The bank must cooperate with the summons even in the absence of a court order, Ibid. Cooperating with a summons does not breach any fiduciary duty the bank owes the customer. Calvin v. Alexander, 36 T.C. 75-5946 (1975). Obedience to the summons by the bank does not violate the customer’s right to privacy. United States v. Raabe, 431 F.Supp. 424 (D.S.D.1977). We conclude that the acts of the bank in obedience to the summons gave rise to no cause of action in favor of Jacobsen.

Jacobsen’s contention of an “invasion of privacy” is based on Billings v. Atkinson, 489 S.W.2d 858 (Tex.1973). In Billings, a tap on a home telephone used by Billings and his wife, occasioned our Supreme Court to announce: “Measured by these considerations, we follow the rule that an unwarranted invasion of the right of privacy constitutes a legal injury for which a remedy will be granted.” 489 S.W.2d at 860.

In support of this contention, Jacob-sen urges also that the bank has violated Tex.Rev.Civ.Stat.Ann. art. 342 — 705 (Vernon 1943), providing in pertinent part:

. neither shall any bank be required to disclose the amount deposited by any depositor to third parties except where (i) the depositor or owner of such deposit is a proper or necessary party to a proceeding in a court of competent jurisdiction in which event the records pertaining to the deposit of such depositor or owner shall be subject to disclosure or (ii) the bank itself is a proper or necessary party to a proceeding in a court of competent jurisdiction or (iii) in response to a subpoena issued by a legislative investigating committee of the Legislature of Texas, or (iv) in response to a request for examination of its records by the Attorney General of Texas pursuant to Article 1302-5.01 et seq. of the Texas Miscellaneous Corporation Laws Act.

This statute has been recognized as: “a reasonable restriction enacted by our Legislature for the protection of our banking institutions and their depositors from disclosing confidential information to third parties except under reasonable and well-defined circumstances.” Wilson v. City of Port Lavaca, 407 S.W.2d 325 (Tex.Civ.App.—Corpus Christi 1966, writ ref’d n. r. e.). We need not determine whether the bank was “unwarranted” in responding to the summons under Billings or “unreasonable” under the Texas statute construed in Wilson as this question has been preempted by the federal statute and the court rulings pursuant thereto under the supremacy clause of the Constitution of the United States Art. VI, clause 2. The supremacy clause applies to internal revenue laws as well as other federal statutes. In United States v. Dallas National Bank, 152 F.2d 582 (5th Cir. 1945), the court specifically held: “[Internal revenue statutes] Having been enacted within the scope of power delegated to the Federal Government, . are a part of the supreme law of the land. If they are in conflict with State law, constitutional or statutory, the latter must yield.” 152 F.2d at 585. Accordingly, we hold that neither the Texas statute nor the Texas decisions can impose a cause of action upon the bank in favor of Jacobsen for the bank’s obedience to the summons authorized by an act of Congress.

Affirmed.


text:
    WORDWORKS, INC., Appellant, v. DALLAS COUNTY STATE BANK, Appellee.
    No. 19899.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 10, 1979.
    Rehearing Denied Sept. 19, 1979.

      Robert H. Bezucha, Carter, Jones, Magee, Rudberg, Moss & Mayes, Dallas, for appellant.
    William H. Shields, McCracken, Shields & Taylor, Carrollton, for appellee.
    Before GUITTARD, C. J., and STOREY and HUMPHREYS, JJ.,
   STOREY, Justice.

This is an appeal from a summary judgment granted in favor of defendant, Dallas County State Bank. Plaintiff urges on appeal that its controverting affidavits, including one filed nine days after the summary judgment hearing and without leave of court, created a fact issue as to whether defendant wrongfully offset funds from plaintiff’s bank account and charged usurious interest on plaintiff’s installment loan. We hold that plaintiff’s affidavits were insufficient to preclude summary judgment under Tex.R.Civ.P. 16&-A. Accordingly, the summary judgment is affirmed.

Plaintiff sued defendant alleging wrongful offset of funds from plaintiff’s bank account and for usurious interest. Plaintiff alleged that pursuant to an oral agreement between the parties, it was required to keep a compensating balance in its bank account equal to at least one-fourth of the outstanding balance of the loan which defendant had made to plaintiff. According to plaintiff’s allegations, this had the effect of reducing the principal amount loaned, so that interest was properly chargeable on no more than three-fourths of the recited principal in the note. When plaintiff became delinquent on the note, defendant exercised its right of offset against plaintiff’s account and applied this offset against the balance remaining on the note. Defendant counterclaimed for the balance remaining on the note, for foreclosure of its security interest on plaintiff’s equipment, and joined third parties as guarantors on the note.

Defendant moved for summary judgment, attaching the note, security agreement, and guaranty contracts of plaintiff’s president and secretary as summary judgment proof. By way of response to defendant’s motion, plaintiff timely filed the affidavits of its vice-president and accountant. Nine days after the summary judgment hearing, plaintiff, without the court’s permission, filed another affidavit of its vice-president, and the parties dispute whether this affidavit was properly before the trial court for consideration. We conclude that this last affidavit was not properly before the court, and that those properly filed failed to raise a fact issue. In order for plaintiff to prevail on its wrongful offset and usury allegations, it must establish an agreement between the parties requiring plaintiff to keep a compensating balance which effectively reduced the amount of principal loaned by defendant; and in order to controvert defendant’s motion for summary judgment, the record must show that a fact question has been raised regarding the existence of the agreement. None of the three affidavits which are conceded to be timely filed raise this question.

In the first affidavit of C. D. Stephens, vice-president of Wordworks, Inc., he states that neither the note nor the security agreement was complete at the time the parties signed those instruments. He further states that plaintiff was required to move all of its banking business to defendant’s bank, thereby causing “a great inconvenience” to it. Neither of these conditions, however, raise an issue of usury. The two affidavits of plaintiff’s accountant contain calculations showing that usurious interest rates were charged on the principal amount of the loan only after the compensating balance had been subtracted from the original amount loaned. The accountant’s affidavit assumes that the agreement to maintain the compensating balance existed, and proceeds to calculate the interest rate accordingly. Moreover, Stephens’ first affidavit fails to prove up any additional agreement between the parties. These affidavits, therefore, fail to show the existence of a dispute as to the terms of the loan transaction. See 4 R. McDonald, Texas Civil Practice §§ 17.26.9 (rev.1971).

Plaintiff argues that Stephens’ second affidavit filed nine days after the summary judgment hearing without leave of court, was properly before the trial court and should have been considered by the court in determining whether a fact issue was presented. In this affidavit, Stephens stated that when he originally contacted Dallas County State Bank concerning the loan, he was told that in order to obtain the loan, plaintiff would be required to move its banking to Dallas County State Bank and maintain a compensating balance equal to one-fourth of the outstanding balance of the loan.

The question is whether this affidavit was properly before the court under Rule 166-A(c) which provides in part: “Except on leave of court, the adverse party, not later than seven days prior to the day of the hearing may serve opposing affidavits or other written response.” Plaintiff urges on the authority of Robinson v. Bullock, 574 S.W.2d 882 (Tex.Civ.App.—Austin 1978, writ ref’d n.r.e.), that because defendant never objected to the timeliness of the affidavit, it cannot assert this as error for the first time on appeal. Plaintiff further argues that because the trial court’s judgment states that it considered “the Motion, the pleadings and the affidavits filed herein .,” it is apparent that the court considered the affidavit even though the record shows no leave of court was obtained. We disagree with both contentions.

The appellant in Robinson failed to object to the form of appellee’s affidavits in the trial court and attempted to point out the defects for the first time on appeal. The court held that under Rule 166-A(e), any claimed defects in the form of the affidavit or attachments must be specifically pointed out in the trial court, and cannot be grounds for reversal on appeal. 574 S.W.2d at 883. The court did not, however, address the question of timeliness of the controverting affidavit under Rule 166-A(e). Lack of timeliness in filing an affidavit differs from a mere defect of form because Rule 166-A(e) places the burden on the party filing the affidavits to bring it to the trial court’s attention by motion or by specifically obtaining leave to file. In the absence of such a procedure, a party would be permitted to further file affidavits that might or might not reach the attention of the trial judge. In this case, we cannot determine whether defendant was given the opportunity to respond to plaintiff’s affidavit because the record fails to show that this affidavit was served on defendant. In addition, plaintiff’s argument that the language in the court’s judgment establishes that the affidavit was considered is without merit. That language means only that the court considered all affidavits properly on file at the time of the summary judgment hearing.

Plaintiff further relies on Aztec Pipe and Supply Company, Inc. v. Sundance Oil Company, 568 S.W.2d 401 (Tex.Civ.App.—Houston [1st Dist.]), writ ref’d n.r.e. per curiam, 576 S.W.2d 780 (Tex.1978), for the proposition that the late filing of an affidavit does not preclude the court from properly considering it as summary judgment proof. Aztec is distinguishable from this case because in that case, appellant’s affidavit was filed prior to the summary judgment hearing. Since the trial court never expressly refused to consider or order the affidavit stricken, the court held that the trial court apparently considered it. 568 S.W.2d at 403. In this case, however, the affidavit was filed nine days after the hearing, and the trial court therefore was not obligated to consider any summary judgment proof filed after the hearing on the summary judgment motion. DeBord v. Muller, 446 S.W.2d 299, 300 (Tex.1969); Silcott v. Wilson, 579 S.W.2d 291, 293 (Tex.Civ.App.—Dallas 1979, no writ); Aztec, 568 S.W.2d at 403. Here the record fails to show that plaintiff was granted leave of court to file the affidavit as required by Rule 166-A(c) and further, there is no evidence that defendant ever received notice of its filing or that it was ever brought to the attention of the judge. We therefore conclude that this affidavit was not properly before the court.

Because plaintiff’s summary judgment proof was insufficient to establish the existence of an agreement between the parties that plaintiff keep a compensating balance in its bank account, no fact issue is raised on plaintiff’s claim of usury. Consequently, defendant had the right to set off against the amount plaintiff had on deposit an amount equal to the indebtedness owed by plaintiff to defendant which was established by the summary judgment proof. Sears v. Continental Bank and Trust Co., 562 S.W.2d 843, 844 (Tex.1977); First National Bank of Bellaire v. Hubbs, 566 S.W.2d 375, 377 (Tex.Civ.App.—Houston [1st Dist.] 1978, no writ). We hold therefore that the trial court properly granted summary judgment.

Affirmed.


author: AKIN, Justice.

text:
    WHITE-WELD & COMPANY, INCORPORATED, Appellant, v. James C. MOSSER, Appellee.
    No. 19836.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 13, 1979.
    Rehearing Denied Sept. 17, 1979.

      John Andrew Martin, William G. Milne, Carrington, Coleman, Sloman, Johnson & Blumenthal, Dallas, for appellant.
    David Watkins, Jenkins & Watkins, Inc., Dallas, for appellee.
    Before AKIN, ROBERTSON and CARVER, JJ.
   AKIN, Justice.

This is an appeal by White-Weld & Company, a member of the New York Stock Exchange, from an adverse judgment obtained against it by a former employee, appellee Mosser. The principal question on appeal is whether the trial judge erred in refusing to abate the suit pending arbitration pursuant to a written agreement between the parties to arbitrate. We hold that the trial judge erred in refusing to abate the suit pending arbitration. Accordingly, we reverse the judgment and remand with instructions.

Mosser filed suit against White-Weld claiming that it owed him commissions that he had earned while employed by White-Weld. Mosser had sold government bonds in several states for White-Weld. In response to Mosser’s petition, White-Weld filed a motion to stay pending arbitration. White-Weld’s motion to stay rested upon a written contract between the parties which provided that all controversies arising out of Mosser’s employment would be settled by arbitration. The trial judge overruled White-Weld’s motion to stay pending arbitration and ordered the parties to trial, at which Mosser was granted judgment against White-Weld.

White-Weld’s motion to stay pending arbitration was based upon the following arbitration clause:

I agree that any controversy between me and any member or member organization or affiliate or subsidiary thereof arising out of my employment or the termination of my employment shall be settled by arbitration at the instance of any such party in accordance with the arbitration procedure prescribed in the Constitution and Rules then obtaining of the New York Stock Exchange, Inc.

This clause appears in an application for employment that both Mosser and a representative of White-Weld signed when Mos-ser commenced work for White-Weld. This application for employment is referred to as Form U^f and is supplied by the New York Stock Exchange. The form contains, in addition to the above arbitration clause, various covenants and ethical considerations which a registered representative of the New York Stock Exchange, such as Mosser, agrees to abide by. Apart from Form U — 4, Mosser had an oral employment contract with White-Weld concerning his financial compensation. Mosser’s suit against White-Weld stems from the parties’ disagreement as to the manner in which his commissions were to be computed under the oral contract.

On appeal, White-Weld argues that the arbitration clause is binding on Mosser, and the trial judge erred in not following the provisions of the Federal Arbitration Act, 9 U.S.C. §§ 1-14 (1976). Specifically, sections two and three of the Act provide:

2. A written provision in any maritime transaction or a contract evidencing a transaction involving commerce to settle by arbitration a controversy thereafter arising out of such contract or transaction, or the refusal to perform the whole or any part thereof, or an agreement in writing to submit to arbitration an existing controversy arising out of such a contract, transaction, or refusal, shall be valid, irrevocable, and enforceable, save upon such grounds as exist at law or in equity for the revocation of any contract. [Emphasis added].
3. If any suit or proceeding be brought in any of the courts of the United States upon any issue referable to arbitration under an agreement in writing for such arbitration, the court in which such suit is pending, upon being satisfied that the issue involved in such suit or proceeding is referable to arbitration under such an agreement, shall on application of one of the parties stay the trial of the action until such arbitration has been had in accordance with the terms of the agreement, providing the applicant for the stay is not in default in proceeding with such arbitration. [Emphasis added].

White-Weld contends that according to section three, the trial judge was required to grant its motion to stay pending arbitration.

Mosser, on the other hand, argues that the trial judge correctly overruled White-Weld’s motion to stay pending arbitration. First, Mosser contends that the subject matter of this suit, the method of computing commissions under his oral employment contract with White-Weld, is not covered by the arbitration clause. Second, Mosser contends that the employment contract does not involve commerce so as to fall within 9 U.S.C. § 2 (1976). Third, Mosser argues that he falls within the exemption of a worker engaged in interstate commerce under 9 U.S.C. § 1 (1976), which provides that the Act shall not apply to “workers engaged in foreign or interstate commerce.” Fourth, Mosser claims that Form U — 4 is a contract of adhesion and that this court should not enforce an arbitration clause contained in such a one-sided agreement. We overrule all of Mosser’s contentions because substantially the same arguments have been rejected by other courts in cases involving similar New York Stock Exchange arbitration clauses.

In Dickstein v. du Pont, 320 F.Supp. 150 (D.Mass.1970), aff’d, 443 F.2d 783 (1st Cir. 1971), an employee of a brokerage firm sued the firm for a finder’s fee because he helped secure a new client for the firm. The Circuit Court of Appeals first held that the arbitration clause in that case, which is the same clause that appears in Mosser’s employment application, compelled the employee to submit his claim for compensation to arbitration. The court also ruled that “the creation of an employment relationship which involves commerce is a sufficient ‘transaction’ to fall within section 2 of the Act.” 443 F.2d at 785. In addition, the court held that the employee was not exempt under 9 U.S.C. § 1 (1976) because the federal courts have construed this section to be limited to persons actually engaged in the movement of goods in interstate commerce. 443 F.2d at 785. This case, therefore, disposes of Mosser’s first three arguments. See Legg, Mason & Co., Inc. v. Mackall & Coe, Inc., 351 F.Supp. 1367 (D.D.C.1972); Youmans v. District Court, 589 P.2d 487 (Colo.1979) (en banc). Likewise, Mosser’s contention that the employment application is a contract of adhesion has also been rejected. Katz v. Shearson Hayden Stone, Inc., 438 F.Supp. 637, 641 (S.D.N.Y.1977); Rust v. Drexel Firestone, Inc., 352 F.Supp. 715, 718 (S.D.N.Y.1972).

Next, Mosser argues that although similar arbitration clauses may have been enforced by federal courts, state courts should not enforce them because the Federal Arbitration Act was not intended to replace a state’s law concerning the enforceability of arbitration clauses. We cannot agree. Our prior opinion in Mamlin v. Susan Thomas, Inc., 490 S.W.2d 634 (Tex.Civ.App.-Dallas 1973, no writ), resolves this argument because that case held that arbitration clauses falling within the Federal Arbitration Act will be enforced by Texas courts. See generally, Youmans v. District Court, 589 P.2d 487 (Colo.1979) (en banc); Episcopal Housing Corp. v. Federal Insurance Co., 269 S.C. 631, 239 S.E.2d 647 (1977); Miller v. Puritan Fashions Corp., 516 S.W.2d 234 (Tex.Civ.App.-Waco 1974, writ ref’d n.r.e.).

Finally, Mosser contends that White-Weld has made no demand for arbitration and does not want arbitration. Obviously, White-Weld desires arbitration as evidenced by its motion to stay in the trial court and by its point of error in this court on that ground. With respect to making a formal demand for arbitration, 9 U.S.C. § 3 (1976) does not require a party to make an actual demand for arbitration as a condition precedent to filing and obtaining a motion to stay. To remedy any potential delay tactics, however, the trial judge may impose a reasonable time limit on the parties in which to complete arbitration. See Katz v. Shearson Hayden Stone, Inc., 438 F.Supp. 637, 642 (S.D.N.Y.1977); Legg, Mason & Co., Inc. v. Mackall & Coe, Inc., 351 F.Supp. 1367, 1372 (D.D.C.1972).

Accordingly, the judgment is reversed and this cause is remanded to the trial court, with instructions that the trial judge shall abate this proceeding and afford the parties a reasonable period of time in which to proceed to arbitration in accordance with their contract.


author: HUMPHREYS, Justice.

text:
    HI-LINE ELECTRIC COMPANY, Appellant, v. The TRAVELERS INSURANCE COMPANIES, Appellee.
    No. 19964.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 14, 1979.
    Rehearing Denied Sept. 19, 1979.

      John D. Griggs, Dallas, for appellant.
    Timothy R. McCormick, Thompson & Knight, Dallas, for appellee.
    Before AKIN, ROBERTSON and HUM-PHREYS, JJ.
   HUMPHREYS, Justice.

This appeal concerns whether appellant Hi-Line Electric Company is a consumer under the Deceptive Trade Practices-Consumer Protection Act, Tex. Bus. & Com. Code Ann. §§ 17.41 — 17.63 (Vernon Supp. 1978 — 1979) (DTPA). Appellant Hi-Line alleged that it purchased services and leased goods from third parties in reliance on misrepresentations of an adjuster for appellee, Travelers Insurance Company. Summary judgment was granted for appellee Travelers on the ground that appellant did not have a cause of action under the DTPA or the Insurance Code. We affirm and hold that appellant is not a consumer for the purposes of the DTPA because appellant did not seek or acquire goods or services from appellee. We also hold that appellant has no cause of action under either the Unfair Claim Settlement Practice Act, Tex. Ins. Code Ann. art. 21.21-2 (Vernon Supp. 1978), or under the unfair practices provisions of the Insurance Code, Tex. Ins. Code Ann. art. 21.21 (Vernon 1963 & Supp. 1978) because article 21.21-2 does not confer a private cause of action and any private action under article 21.21 must be based on the DTPA, which, we hold, does not apply to this case.

This case arose from an automobile accident between appellant and appellee’s insured. Appellant sued appellee’s insured for negligence and sued appellee, the insurance carrier, for breach of contract, fraud, and for violations of the DTPA and of the Insurance Code. After appellant’s action against appellee was severed, partial summary judgment was granted denying appellant’s claims against appellee under section 17.50 of the DTPA and the Insurance Code. The case then proceeded to trial on the grounds of breach of contract and fraud, and appellant was awarded judgment in the amount of $519.64. Appellant complains only of the court’s grant of partial summary judgment and its failure to set aside the summary judgment.

According to appellant, after the accident, appellee agreed to pay for repairs to appellant’s truck, rental of another truck, and the cost of transferring merchandise between the damaged truck and the leased truck. It also contends that appellee made recommendations as to where to have repairs performed and where to rent the vehicle. Appellant claims that it was forced to pay the repair and rental costs when appel-lee refused to do so , and that its own insurance company would have paid these bills if appellee had not promised to pay them. Appellant also alleged that appellee agreed to pay without intending to do so and consequently, violated the DTPA.

Appellee seeks to justify the summary judgment on the ground that the petition shows on its face that appellant is not a “consumer” with respect to appellee within the ambit of the DTPA. Appellee points out that in order to sue under section 17.50 of the DTPA, plaintiff must be a consumer, which is defined in section 17.45(4) as “an • individual, partnership, corporation, or governmental entity who seeks or acquires by purchase or lease, any goods or services.” Appellee cites Russell v. Hartford Casualty Insurance Co., 548 S.W.2d 737 (Tex.Civ. App.-Austin 1977, writ ref’d n. r. e.), for the proposition that appellant is not a consumer. Russell is not controlling here because in that case, plaintiffs did not purchase or lease any goods or services. As in the present case, the plaintiffs in Russell were involved in a collision with defendant’s insured. After defendant Hartford provided a rental car for seven days and then can-celled the agreement, plaintiffs sued Hartford under the DTPA. The court held that the plaintiffs in that case were not consumers because they did not purchase or lease anything. 548 S.W.2d at 741. In this case, appellant purchased services and leased goods from third parties at appellee’s suggestion but not from appellee. Our question then is whether the DTPA provides a cause of action when the services and leased items were sought and obtained from third parties.

Appellee contends that a consumer must seek or acquire goods or services from the person he is suing. We agree. Although the plaintiff and defendant need not be in privity or in a contractual relationship, a consumer must seek or acquire goods or services furnished by defendant. In this case, appellee only represented to appellant that it would pay money to appellant for appellant’s purchase of goods and services from others. The DTPA was not intended to cover situations where the defendant is not engaged in any sale or lease transaction, or any offer or advertisement of a sale or lease, with plaintiff. The Act was designed to protect consumers from misleading business practices made in connection with a sale, lease, advertisement, etc. We hold that appellant is not a consumer with respect to appellee because the alleged misrepresentation was not made in connection with any actual or prospective sale or lease transaction in which appellant was seeking or acquiring goods, or services supplied by appellee.

We also deny appellant’s claims under articles 21.21-2 and 21.21 of the Insurance Code. Article 21.21-2 of the Insurance Code regulates unfair claims practices of insurance companies. It empowers the State Board of Insurance to revoke licenses of violators and issue other orders, but it does not confer a private cause of action. Lone Star Life Insurance Co. v. Griffin, 574 S.W.2d 576, 580 (Tex.Civ.App.-Beaumont 1978, writ ref’d n. r. e.); Russell v. Hartford Casualty Insurance Co., 548 S.W.2d 737, 742 (Tex.Civ.App.-Austin 1977, writ ref’d n. r. e.). Article 21.21 is primarily directed to unfair competition and trade practices of insurance companies such as false advertising, defamation, and discrimination. Section 16(a) of article 21.21 states: “Any person who has been injured by another’s engaging in . any practice defined by Section 17.46 of the Business & Commerce Code, as amended, as an unlawful deceptive trade practice may maintain an action against the company or companies engaging in such acts or practices.” The application of article 21.21, therefore, depends on whether there was a violation of the DTPA.

We note that article 21.21(16)(a) grants a cause of action to a “person” injured by a deceptive act under section 17.46 of the DTPA. A “person” as used in article 21.-21(16)(a) must be a consumer as defined in section 17.50 of the DTPA because article 21.21 of the Insurance Code and the DTPA refer to each other. Section 17.50(a)(4) of the DTPA allows only a consumer to recover for violations of article 21.21 of the Insurance Code. Accordingly, the two statutes must be read together. See General Accident, Fire & Life Assurance Corp. v. Legate, 578 S.W.2d 505, 506 (Tex.Civ.App.-Texarkana 1979, writ ref’d n. r. e.); Mobile County Mutual Insurance Co. v. Jewell, 555 S.W.2d 903, 910 (Tex.Civ.App.-El Paso 1977, writ ref’d n. r. e.). Neither were intended to apply to a situation where the plaintiff and defendant were not engaged in a prospective or actual sale or lease of goods or services between them. Since we have held that appellant is not a consumer within section 17.50 of the DTPA, we likewise hold that it is not a person within article 21.-21(16)(a) and has no cause of action under that article.

Affirmed.


text:
    HENRY S. MILLER CO., Appellant, v. Walter H. STEPHENS, Appellee.
    No. 19951.
    Court of Civil Appeals of Texas, Dallas.
    Aug. 14, 1979.
    Rehearing Denied Sept. 19, 1979.
    Harold Hoffman, Donald C. McCleary, Wynne & Jaffe, Dallas, for appellant.
    Bill C. Hunter, Hunter, Stewart, Salzber-ger & Vineyard, Dallas, for appellee.
    Before AKIN, ROBERTSON and HUM-PHREYS, JJ.
   AKIN, Justice.

This is an appeal by Henry S. Miller Company, the vendee, from a judgment granting specific performance of a real estate contract of sale in favor of the vendor, appellee Walter H. Stephens. Appellant Henry S. Miller Company contends that the trial court erred in granting specific performance because the vendor did not hold title to the land at the time of trial. We agree with appellant and reverse the trial court’s judgment.

The contract in question was for the sale of approximately 490 acres of land in Travis County, Texas, between Stephens as vendor and Henry S. Miller Company as vendee. The contract was executed on September 13, 1973, and the sale was to close on or before July 1, 1974. Henry S. Miller Company refused to close, however, and appel-lee Stephens brought suit for specific performance. Appellee held the land for approximately two years after the closing date. Six weeks prior to trial, however, appellee lost title to the land through a foreclosure sale and title was transferred to Travis Lake Properties, Ltd. Travis Lake Properties was not a party to this lawsuit. Despite appellee’s lack of title and the absence of Travis Lake Properties as a party to the suit, the trial court granted specific performance of the land sale contract and ordered appellant Henry S. Miller Company to pay the contract purchase price of $1,446,531.00.

When a party seeks specific performance, he is required at all times to remain ready, willing and able to perform his contractual responsibilities according to the terms of the contract. Kluck v. Leuschner, 70 S.W.2d 768, 769 (Tex.Civ.App.—Waco 1934, writ ref’d) (per Alexander, J.). Both parties agree that specific performance will not usually be ordered for the vendor unless he has legal title to the property at the time of trial. E. g., Buhler v. McIntire, 365 S.W.2d 237, 239 (Tex.Civ.App.—Austin 1963, writ ref’d n.r.e.); Clifton v. Charles, 53 Tex.Civ.App. 448, 116 S.W. 120, 122 (1909, writ ref’d). Appellee maintains, however, that an exception to these rules applies if the vendor loses title after the closing date but prior to trial and the vendor’s loss was due to a contingency, known to both parties at the time of contract, which the vendee caused or could have prevented. In this respect, appellee argues that Henry S. Miller Company failed to close the sale and refused to make a cash payment to appellees which was due at the closing. Appellee claims that this payment was designed to provide the funds required to prevent foreclosure and that Miller also failed to take any other steps to prevent the foreclosure. Thus, appellee argues that these failures on appellant’s part directly caused the foreclosure, and therefore appel-lee falls within the exception to the requirement that a vendor seeking specific performance must hold title at the time of trial. In support of its position, appellee relies on Fant v. Howell, 410 S.W.2d 294 (Tex.Civ.App.—Austin 1966, writ dismd.), and Manley v. Holt, 161 S.W.2d 857 (Tex.Civ.App.—Amarillo 1942, writ ref’d w.o.m.).

These cases do not support the proposition that a vendor seeking specific performance will be excused from holding title at the time of trial if the vendee could have prevented the vendor’s loss of title. They stand for the significantly different proposition that the vendor will be excused if the loss of title occurred as a result of a contingency or obligation assumed directly by the vendee. In Fant v. Howell, supra, both parties knew at the time of contract that third parties were holding adverse possession to the land. After the vendee took possession of the land, the third parties’ title by adverse possession ripened. The court held that the vendor was not precluded from bringing an action for specific performance, despite the loss of title to the land, because the vendee was responsible for the loss of title through adverse possession. In Manley v. Holt, supra, the vendee expressly assumed the obligation to pay the vendor’s creditors. Foreclosure resulted when the vendee failed to make these payments. The Holt court also held that the vendor was not precluded from bringing an action for specific performance because the loss of title was caused by the vendee’s failure to carry out his obligations.

The contract before us in this case does not contain any provision obligating the vendee to satisfy the vendor’s creditors or otherwise prevent the vendor’s loss of title. Consequently, the vendor was not relieved of the requirement that he hold title at the time of the trial of his specific performance action. Since appellee did not hold title, the trial court’s judgment for specific performance was error. Accordingly, the judgment of the trial court is reversed. In the interest of justice, we remand rather than render, so that plaintiff may plead and prove whatever damages that he may have. Morrow v. Shotwell, 477 S.W.2d 538, 542 (Tex.1972).