author: YOUNG, Justice.

text:
    William Lester FULCHER, Jr., Appellant, v. TEXAS STATE BOARD OF PUBLIC ACCOUNTANCY et al., Appellees.
    No. 1280.
    Court of Civil Appeals of Texas, Corpus Christi.
    Aug. 29, 1978.
    Rehearing Denied Oct. 5, 1978.

      Randall P. Crane, San Benito, James H. Denison, Jr., Denison & Mann, Harlingen, for appellant.
    Sloan B. Blair, Cantey, Hanger, Gooch, Munn & Collins, Fort Worth, Bill Campbell, Asst. Atty. Gen., Austin, for appellees.
   OPINION

YOUNG, Justice.

In this instructed verdict case the trial court granted to appellees, the Texas State Board of Public Accountancy and the Texas Society of Certified Public Accountants, a permanent injunction against appellant, William Lester Fulcher, preventing him from using the words “public accounting officers”, “accounting offices”, “accounting practitioner”, “account”, “accounting”, “accountant” or any abbreviation or derivation thereof in connection with his business. Fulcher brings this appeal. We affirm.

This action relates to our prior decision in Texas State Board of Public Accountancy v. Fulcher, 515 S.W.2d 950 (Tex.Civ.App.— Corpus Christi 1974, writ ref’d n. r. e.), where we held that William L. Fulcher, the appellant herein should be enjoined from using the word “accountant” on his signs and business envelopes while not licensed under the Public Accountancy Act of Texas, Tex.Rev.Civ.Stat.Ann. art. 41a (1969). Following that decision appellant Fulcher dropped the designation “accountant” and substituted the word “accounting” combined with other words to represent himself as follows: “Fulcher, Bill & Associates Accounting & Taxes” on his building directory; “Public Accounting Offices” on the door to his office and in announcements sent concerning his new office; “Accounting Offices” on his card, letterhead and envelopes; and “Accounting practitioner” on his tax form covers.

The Texas State Board of Public Accountancy, represented initially by the Attorney General, and the Texas Society of Certified Public Accountants brought the present suit to enjoin Fulcher’s representations. Immediately prior to the trial, Joe K. Hend-ley, District Attorney for Cameron County, placed himself on record as also representing the Texas State Board of Public Accountancy. Our prior opinion well describes the types of services that appellant provides his customers; we will not here repeat those matters. At the time of this trial, he was not registered as a certified public accountant or public accountant under the Public Accountancy Act of Texas. Trial was to the court with a jury. At the close of all the evidence the court granted an instructed verdict in appellees’ favor from which judgment Fulcher appeals.

Appellant brings six points of error. His point 1 asserts that the trial court’s order violates the First and Fourteenth Amendments to the United States Constitution. We need not consider the merits of this point, though, in that appellant failed to pursue and to receive a trial court determination upon this issue. See Westinghouse Credit Corporation v. Kownslar, 496 S.W.2d 531 (Tex.Sup.1973); Setliff v. Gorrell, 466 S.W.2d 74, 79 (Tex.Civ.App.— Amarillo 1971, no writ); Van Hoose v. Moore, 441 S.W.2d 597, 619 (Tex.Civ.App.— Amarillo 1969, writ ref’d n. r. e.); Walter E. Heller & Company v. Allen, 412 S.W.2d 712, 718 (Tex.Civ.App. — Corpus Christi 1967, writ ref’d n. r. e.); Rule 373, T.R.C.P. The First and Fourteenth Amendments to the United States Constitution were not mentioned in appellant’s trial pleadings or anywhere in the record. And, the general term constitutionality was only mentioned twice in the statement of facts. The first mention was made at a pre-trial hearing one week before trial. There the appellant’s attorney stated, “The question is simply whether or not his constitutional rights are being invaded by their attempting to make him stop using the designation of accounting practitioner . . . ” This comment did not direct the court to which constitution appellant was referring, whether state or federal, or what sections of which constitution were being violated. In addition, the record reflects no attempt by appellant to have the court pass upon any constitutional issues whatsoever after this casual comment was made. The second reference to a constitutional matter was made during the trial. After all of the evidence had been submitted, the trial court stated that this Court of Civil Appeals in Texas State Board of Public Accountancy v. Fulcher, supra, had “passed on the constitutionality on the thing back there” (here evidently referring to the constitutionality of the Act). The appellant’s attorney then replied “as far as the law is concerned, we are not asking that, Your Honor.” Thus, appellant was stating he was making no challenge to the constitutionality of the Act. Accordingly, we find that any issues concerning the First and Fourteenth Amendments of the United States Constitution were not passed upon by the trial court and we need not consider them on appeal.

Even if we were to consider appellant’s constitutional argument we could not agree with his reasoning. He relies primarily upon Virginia State Board of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 96 S.Ct. 1817, 48 L.Ed.2d 346 (1976) and Bates v. State Bar of Arizona, 433 U.S. 350, 97 S.Ct. 2691, 53 L.Ed.2d 810 (1977). Both of these cases dealt with the public’s First Amendment right to the dissemination of information about a product or service. Appellant, on that ground, reasons that any truthful information, i. e., that he provides accounting services, is protected by the First Amendment, and that he has a right to release it to the public. The Court in Bates, however, stated that advertising which is false, deceptive or misleading remains subject to restraint, Bates, 433 U.S. 350 at 383, 97 S.Ct. 2691, and as we will hereafter show, some usages of the term “accounting” can mislead or deceive the public.

The expressed purpose of the Act (Article 41a) is, to wit: “the regulation and licensing of persons to practice public accounting in this state.” Texas State Board of Public Accountancy v. Fulcher, supra, at 956. In this connection, the Legislature prohibited the use of certain terms which might deceive or mislead the public. Of particular importance are portions of Sections 8(c) and 8(g). Section 8(c) provides in part:

(c) No person shall assume or use the title or designation ‘public accountant’ or any other title, designation, words, letters, abbreviation, sign, card, or device tending to indicate that such person is a public accountant, unless such person is registered as a public accountant under Section 11 or Section 13 . holds a live permit issued under Section 9 of this Act and all of such person’s offices in this state for the practice of public accounting are maintained and registered as required under Section 10 hereof, . . ” (Emphasis supplied.)

Section 8(e) further provides in part:

“(e) No person shall assume or use the title or designation ‘certified accountant,’ ‘chartered accountant,’ ‘enrolled accountant’ ‘licensed accountant,’ or any other title or designation likely to be confused with ‘certified public accountant’ or ‘public accountant,’ or any of the abbreviation, ‘CA,’ ‘PA,’ ‘EA,’ ‘RA,’ or ‘LA,’ or similar abbreviations likely to be confused with ‘CPA’; provided, however, that only a person holding a live permit issued under Section 9 of this Act and all of whose offices in this state for the practice of public accounting are maintained and registered as required under Section 10 hereof may hold himself out to the public as an ‘accountant’ or ‘auditor’ or combination of said terms, . . . ” (Emphasis supplied.)

See also § 10(d) of the Act. Evident in the above mentioned subsections is the Legislative intent to register all offices which practice “public accounting.” Further evident is the Legislative intent to prevent one from using any designation likely to be confused with “public accountant.” Finally, Section 8(g) provides:

“(g) No person shall sign or affix his name or any trade or assumed name used by him in his profession or business, with any wording indicating that he is an accountant or auditor, or with any wording indicating that he has expert knowledge in accounting or auditing, to any accounting or financial statement, or to any opinion on, report on or certificate to any accounting or financial statement, unless he has complied with the applicable provisions of this Act . . . ” (Emphasis supplied)

While this last section applies only to the affixation of deceptive titles to financial statements and opinions, it clearly indicates the Legislature’s belief that one signifying to possess expert accounting knowledge might mislead the reader of the financial statement into believing that he is a public accountant.

In this regard, when determining the Legislature’s intent in section 8(e) and its prohibition against using any designation likely to be confused with “public accountant,” we must construe all of these sections together. 53 Tex.Jur.2d, Statutes § 160 (1964). We think that Section 8(g) taken in conjunction with Section 8(e) and 8(c) evidences a legislative purpose to prevent anyone from holding himself out as having expert knowledge in accounting or auditing no matter what the representation is printed or lettered upon. Accordingly, that terminology appellant used in this case to hold himself out as having expert knowledge in accounting would be in violation of Section 8(e). In accord with this result is People v. Hill, 66 Cal.App.3d 320, 136 Cal.Rptr. 30 (1977). In Hill, the California Court of Appeals held that a firm’s calling itself “A-Accounting” violated the provisions of the California Accountancy Act. The California Act states that one would be in violation of the Act if he “holds himself or herself out to the public in any manner as one skilled in the knowledge, science and practice of accounting, and as qualified and ready to render professional service therein as a public accountant for compensation”. This provision is similar to Texas Section 8(g) except that the California Statute prohibits holding oneself out to the public as having expert accounting knowledge. Texas, on the other hand, prohibits this manner of representation on financial statements without mention of other methods of representation. The California case places special reliance on this particular provision of their statute. We do not think, however, that this distinction is significant enough to render the California decision inapplicable to our situation. The underlying intention of both statutes is to prevent the deception of the public, and we think that its rationale applies to this case also. See also in this connection the Texas Engineering Practice Act, Tex.Rev.Civ.Stat.Ann. art. 3271a § 18 (1968).

In sum, then, we think Virginia Pharmacy, supra, and Bates, supra do not control in this situation. Appellant’s holding himself out as possessing expert knowledge in accounting is misleading and remains subject to restraint as stated in Bates, supra. Appellant’s point 1 is overruled.

Appellant’s point 2 contends that the court’s order improperly hinders his use of his purported federal license to practice before the Internal Revenue Service as an “enrolled agent”. Appellant’s point 3 contends that the trial court’s order is an ove-rextention of the State’s police power and is thus violative of Tex.Const. Art. I § 19. We need not consider the merits of these contentions though, in that there is no indication in the record that these specific theories were brought to the attention of or decided by the trial court. See Westinghouse Credit Corporation v. Kownslar, supra.

Appellant also argues in point 3, as well as in point 2, that the court’s judgment is overly broad in its prohibition against the usage of the words “public accounting offices,” “accounting offices,” “accounting practitioner,” “accounts,” “accounting,” “accountant,” or any abbreviation or derivation thereof. The only place in the record where the appellant objected to this type of language was in his special exception 5. There the appellant gave as his basis for objection the obscurity and ambiguity of these words in the appellees’ original petition. This special exception was overruled. Appellant does not appeal the decision on the special exception. No claim is made herein that the decision on the special exception was incorrect. The appellant is, however, claiming that the judgment is overly broad. Because this specific argument was not made in the trial court, we cannot consider it here for the first time on appeal. Westinghouse Credit Corporation v. Kownslar, supra. Appellant’s points 2 and 3 are overruled.

Appellant’s point 4 submits that the trial court erred in treating as a question of law, rather than of fact, the issue of whether appellant’s use of the before mentioned terms are likely to be confused with “public accountant.” We disagree.

Settling upon which terms may or may not deceive the public should not be left to be variantly decided by varying juries. Certainty is a necessity in this area. See 3 McDonald, Texas Civil Practice § 12.03.1 (1970). Hutcheson, Law and Fact in Insurance Cases, 23 Tex.L.Rev. 1 (1944). Thus, we hold it is a question of law as to what representation will be considered deceptive to the public. Appellant’s point 4 is overruled.

Appellant’s point 5 contends that the trial court improperly expanded the number of prohibited titles enumerated in Article 41a. We cannot agree for the reason that the trial court’s determination is based upon the reasoning that the titles “Accounting Offices,” “Public Accounting Offices” and “Accounting Practitioner” are terms which are likely to be confused with “Public Accountant” or “Accountant” as prohibited in Article 41a subd. 8(e). Appellant’s point 5 is overruled.

Appellant’s point 6 contends that the Attorney General was not authorized to bring this suit on behalf of the State Board of Public Accountancy, and that the Texas Society of Certified Public Accountants was not a proper party to seek injunctive relief.

Rule 12, T.R.C.P. provides:

“Any defendant in any suit or proceeding pending in any court of this state may, by sworn written motion stating that such defendant believes that such suit or proceeding was instituted against him or is being prosecuted against him without authority on the part of the plaintiff’s attorney, cause such attorney to be cited to appear before such court and show his authority for same, notice of which motion shall be served upon such attorney at least ten days before the trial of such motion. Upon the hearing of such motion, the burden of proof shall be upon the attorney appearing for the plaintiff to show sufficient authority from the plaintiff in such suit or proceeding to institute or prosecute the same. Upon his failure to show such authority, the court shall refuse to permit such attorney to appear in said cause, and shall dismiss the same if no person who is authorized to prosecute said cause appears . . ”

Rule 12 is the exclusive method for questioning the authority of an attorney to bring a suit. Angelina County v. McFarland, 374 S.W.2d 417, 423 (Tex.Sup.1964); Cook v. City of Booker, 167 S.W.2d 232, 233 (Tex.Civ.App. — Amarillo 1942, no writ). In order for Fulcher to have properly challenged the authority of the Attorney General to represent the Texas State Board of Public Accountancy it was his duty to invoke Rule 12 by filing a sworn written motion contesting the Attorney General’s authority. See Taylor v. Texas Department of Public Welfare, 549 S.W.2d 422 (Tex.Civ.App. — Fort Worth 1977, writ ref’d n. r. e.); Cook, supra. See also Collins v. State, 506 S.W.2d 293 (Tex.Civ.App. — San Antonio 1974, no writ); Morris v. Smiley, 378 S.W.2d 149, 152 (Tex.Civ.App. — Austin 1964, writ ref’d n. r. e.); Morris v. Hoerster, 377 S.W.2d 841, 844 (Tex.Civ.App. — Austin 1964, no writ). In Cook, supra, the court stated that a plea in abatement was not sufficient to challenge an attorney’s authority to represent a plaintiff, but that a Rule 12 motion is the exclusive method for challenging this authority. In the trial court Fulcher filed a motion to dismiss alleging “the Attorney General for the State of Texas has no authority under the Constitution of this State nor under any State Statute to file suits for injunctive relief in behalf of the State Board of Public Accountancy.” No other allegations were made which indicated that Rule 12 was being invoked. This motion was not sworn to. Moreover, in substance, the motion to dismiss was tantamount to a plea in abatement. See McDougald v. First Nat. Bank of Beaumont, 239 S.W.2d 145, 149 (Tex.Civ.App.— Beaumont 1951, writ ref’d n. r. e.); 1 Tex. Jur.2d, Abatement and Revival § 3 (1959). Accordingly, appellant’s contention as to the authority of the Attorney General is not reviewable on appeal.

Even if we were to consider appellant’s challenges to the Attorney General’s authority we would reach the same result. Appellant argues that the Attorney General may not represent the Texas State Board of Public Accountancy because Section 7 of the Act provides: “No expenses incurred under this Act shall ever be a charge against the funds of the State of Texas.” We find, however, in Section 23 of the Act the statement that at all hearings the Attorney General of this State or one of his assistants shall appear and represent the Board. This provision shows the construction the appellant gives to Section 7 is not in accord with the entire Act; i. e., the statute intended that State funds would be spent for representation by the Attorney General when enforcing certain provisions of this Act. Further, Joe K. Hendley, District Attorney of Cameron County, was present at the trial of this case and placed himself on record as one of the attorneys representing the State Board of Public Accountancy. Accordingly, if there was error, there was no harmful error in the Attorney General’s joining in the representation of the Texas State Board of Public Accountancy-

Appellant also challenges the standing of the Texas Society of Certified Public Accountants. We need not here consider that point, though, in that the Texas State Board of Public Accountancy has not been shown to be without standing. Further, any decision as to the standing of the Society could have no effect on the disposition of this appeal. Rule 434, T.R.C.P. Accordingly, appellant’s point 6 is overruled.

The judgment of the trial court is affirmed.


source: Caselaw Access Project

author: CORNELIUS, Chief Justice.

license: Public Domain

text:
    Paul E. SMITH et ux., Appellants, v. Glen D. NASH et ux., Appellees.
    No. 8596.
    Court of Civil Appeals of Texas, Texarkana.
    Aug. 29, 1978.
    Rehearing Denied Oct. 10, 1978.

      Hardy Moore, Moore & Lipscomb, Paris, for appellants.
    J. D. McLaughlin, Fisher, McLaughlin & Harrison, Paris, for appellees.
   CORNELIUS, Chief Justice.

Mr. and Mrs. Paul E. Smith appeal from a district court judgment denying their plea for specific enforcement of a contract for the sale of real estate. The contract was between Mr. and Mrs. Glen Nash as sellers and the Smiths as buyers, and provided for the sale of a house and lot in Paris, Texas, for a consideration of $12,500.00, $1,000.00 of which was to be paid at the execution of the contract and the balance to be paid in cash at closing. No date for the closing of the transaction, or for the expiration of the contract in the absence of a closing, was provided. The contract contained the following stipulation:

“This contract is made and entered into subject to the purchaser securing a 75% conventional loan in the amount of at least $10,000.00 amortized over 10/15 years at 9% interest rate.”

Mr. Smith was unable to secure a loan for $10,000.00, but he did secure a commitment for a $9,000.00 loan. Some two months after the contract was executed, he made arrangements to secure the balance of the purchase price and, advising Mr. Nash that he desired to complete the sale regardless of the loan amount, demanded a conveyance. Mr. Nash refused, stating that when it became clear that the $10,000.00 loan was not available he assumed that Smith was relieved from the contract, whereupon he began looking for another buyer and had already arranged for another sale for the greater price of $15,000.00 by the time Smith demanded performance. Nash took the position that Smith had abandoned the contract, and that he only tried to enforce it after he discovered that Nash had arranged a sale for a higher price. Nash admitted in his testimony, however, that in his discussions with Smith, Smith did not agree to release the contract, but wanted him to “hold it” while Smith kept on shopping for loans.

Trial was to the court without a jury, and findings of fact and conclusions of law were neither requested nor filed. See Tex.R. Civ.P. 296. In those circumstances we must affirm the trial court’s judgment if it can be sustained upon any lawful theory supported by the pleadings and the evidence.

Although they pleaded only lack of mutuality, oral rescission and lack of tender as defenses in the district court, Mr. and Mrs. Nash contend here that the contract of sale was unenforceable for the following reasons: its land description is uncertain, it is lacking in mutuality, it was voluntarily rescinded or abandoned by the Smiths, and the Smiths failed to make a tender of performance as is required to enforce specific performance. We have concluded that the district court’s judgment cannot be sustained on any of those theories.

I

The property description is adequate. For a contract of sale to meet the requirements of our statute of frauds, it must, insofar as the property description is concerned, furnish within itself or by reference to other identified writings then in existence, the means or data by which the particular land to be conveyed may be identified with reasonable certainty. Wilson v. Fisher, 144 Tex. 53, 188 S.W.2d 150 (1945); Ogilvie v. Hill, 563 S.W.2d 846 (Tex.Civ.App. Texarkana 1978, writ ref’d n. r. e.); 5 F. Lange, Texas Land Titles, Sec. 762, p. 154 (1961); 26 Tex.Jur.2d, Frauds, Statutes of, Sec. 95, p. 252. The description in the contract involved here was:

“Lying and situated in the Texas and Pacific Addn. as Lot 1, Block 160, otherwise known as 308 E Washington, Paris, Texas.”

A description of platted city property by lot, block, addition and city is sufficient. Loring v. Peacock, 236 S.W.2d 876 (Tex.Civ.App. Fort Worth 1951, no writ). See Arambula v. Sullivan, 80 Tex. 615, 16 S.W. 436 (1891); and Elliott v. Henck, 223 S.W.2d 292 (Tex.Civ.App. Galveston 1949, writ ref’d n. r. e.).

II

The assertion that the contract lacked mutuality is based upon three grounds: (1) the contract’s provision that it was conditioned upon Smith securing a $10,000.00 loan, rendered the contract not subject to specific performance by Nash at its inception and therefore destroyed the requisite mutuality; (2) the contract contains no time for performance; and (3) the contract was conditioned upon the delivery of certain personal property, some of which was missing when Smith demanded a conveyance.

As a general rule, specific performance of a contract will be granted only in cases where there is a mutuality of remedy. 52 Tex.Jur.2d, Specific Performance, Sec. 44, p. 572. But it is not essential that mutuality of remedy exist at the time the contract is executed, it being sufficient if such mutuality exists at the time the suit is filed. Adams v. Abbott, 151 Tex. 601, 254 S.W.2d 78 (1952); Langley v. Norris, 141 Tex. 405, 173 S.W.2d 454 (1943); Nelson v. Jenkins, 214 S.W.2d 140 (Tex.Civ.App. El Paso 1948, writ ref’d); 52 Tex.Jur.2d, Specific Performance, Sec. 46, p. 576; 65 A.L.R. 52 (1930). A contract unconditional as to one party but conditional as to the other party is valid and enforceable upon either the occurrence or the waiver of the condition. Northern Texas Realty & Construction Co. v. Lary, 136 S.W. 843 (Tex.Civ.App. 1911, writ ref’d); Nelson v. Jenkins, supra; 52 Tex.Jur.2d, Specific Performance, Sec. 48, pp. 581, 582. More specifically, a contract for the sale of land which is unconditional on the part of the seller, but is conditional on the part of the buyer, may be specifically enforced when the buyer elects to waive the condition and purchase the property in accordance with the contract. Langley v. Norris, supra; Northern Texas Realty & Construction Co. v. Lary, supra; 52 Tex.Jur.2d, Specific Performance, Sec. 46, pp. 576, 577. The provision in question here, conditioning the sale upon the availability of a $10,000.00 loan, was placed in the contract for the benefit of the purchasers. The sellers cannot take advantage of that condition to defeat the sale if the purchasers elect to waive it and proceed with their purchase according to the other terms of the agreement. Compare Leonard v. King, 63 Tex.Civ.App. 224, 135 S.W. 742 (1910, no writ).

The absence of a time for performance, or a time for termination of the contract for lack of performance, did not render the contract unenforceable. In the absence of a provision for time of performance, the law implies that a reasonable time was intended. Moore v. Dilworth, 142 Tex. 538, 179 S.W.2d 940 (1944); Hart v. Bullion, 48 Tex. 278 (1877); Cheek v. Metzer, 116 Tex. 356, 291 S.W. 860 (1927); 52 Tex. Jur.2d, Specific Performance, Sec. 49, p. 582. And in a contract where time is not of the essence, so long as neither party has taken steps to demand a completion — that is, so long as the vendor has made no tender or offer of a deed, or demand upon the vendee, and the vendee has made no tender of the price, or demand upon the vendor— and absent a rescission or abandonment of the contract, it remains binding until its enforcement is barred by the statute of limitations. Riley v. McNamara, 83 Tex. 11, 18 S.W. 141 (1892); Helsley v. Anderson, 519 S.W.2d 130 (Tex.Civ.App. Dallas 1975, no writ); Upton v. Maurice, 34 S.W. 642 (Tex.Civ.App. 1896, no writ); 52 Tex.Jur.2d, Specific Performance, Sec. 49, p. 583. It is uncontroverted in this record that no demand or tender of performance was made by either party prior to Smith’s demand which precipitated the suit. There is no evidence of a rescission. And Mr. Nash’s own testimony reveals that, rather than abandoning the contract, Mr. Smith urged him not to seek another buyer but to hold the contract until he could complete the necessary arrangements to close the sale. Under the circumstances, a conclusion that the contract had been rescinded or abandoned would not be justified. If there is any evidence to support such a conclusion, we find it against the great weight and preponderance of the evidence.

Neither did the provision concerning the personal property destroy the contract’s mutuality. That provision being for the buyers’ benefit, they could waive it and proceed with the purchase even though some of the property was missing.

Ill

Finally, it is urged in support of the judgment that the Smiths did not make proper tender of the purchase price as is required to specifically enforce a contract for the sale of real property. The testimony established that the Smiths, when they demanded completion of the contract, had made the necessary arrangements and were then in a position to pay Mr. and Mrs. Nash the $12,500.00 purchase price in cash, and offered to do so. In addition, their petition and their testimony at the trial asserted that they were ready, willing and able to acquire and pay for the property as agreed in the contract, and offered to do so.

In cases of this type it is not necessary that the buyer physically offer the seller the cash sales price. It is only necessary that the buyer plead and prove that he is ready, willing and able to pay the consideration and perform the essence of the agreement, and offer to do so as was done here. The decree may then enforce the performance. Burford v. Pounders, 145 Tex. 460, 199 S.W.2d 141 (1947); Cowman v. Allen Monuments, Incorporated, 500 S.W.2d 223 (Tex.Civ.App. Texarkana 1973, no writ); Grossman v. Liedeker, 202 S.W.2d 267 (Tex.Civ.App. San Antonio), rev’d on other grounds, 146 Tex. 308, 206 S.W.2d 232 (1947); Fordtran v. Dunovant, 54 Tex.Civ.App. 564, 118 S.W. 768 (1909, no writ); Kalklosh v. Haney, 4 Tex.Civ.App. 118, 23 S.W. 420 (1893, no writ); 52 Tex.Jur.2d, Specific Performance, Secs. 52 and 53, pp. 588-591.

The appellants’ points of error are sustained.

The district court, concluding that the contract was unenforceable, did not determine the Smiths’ claim for damages. For that reason, the judgment will be reversed and the cause remanded to that court for entry of a decree of specific performance as prayed for, and for trial on the merits of the issue of damages.

      . Tex.Bus. & Comm.Code Ann. Sec. 26.01.


author: RAY, Justice.

text:
    SOUTHWESTERN BELL TELEPHONE COMPANY, Appellant, v. FRIO MATERIALS COMPANY, INC., Appellee.
    No. 8570.
    Court of Civil Appeals of Texas, Texarkana.
    Aug. 29, 1978.
    Rehearing Denied Oct. 17, 1978.

      C. V. Flanary, Jr., Paris, for appellant.
    Hardy Moore, Moore & Lipscomb, Paris, for appellee.
   RAY, Justice.

This is a trespass case. Appellant (plaintiff), Southwestern Bell Telephone Company, brought suit against appellee (defendant), Frio Materials Company, Inc., seeking damages for the injury done to its underground conduit and cables. Following a jury verdict in favor of appellee, the trial court entered its judgment accordingly. Appellant has perfected its appeal and submits nine points of error for our consideration.

The damaged cables and conduit in this case had been buried and in place on the right-of-way beneath Loop 286 near Paris, Texas, since 1960. The Texas Highway Department approved the location on July 19, 1960. In 1971, the Texas Highway Department notified appellant that an overpass on the Loop would be built to cross over U. S. Highway 82. In December of 1972, at the request of the Texas Highway Department, the precise location of appellant’s buried cables beneath the right-of-way of Loop 286 at its intersection with U. S. Highway 82 was determined and marked with flags by appellant from the manhole on the west side of the Loop to the manhole on the east side of the Loop, and the conduit through which ran the cables was actually exposed at two points on the right-of-way of the Loop. Previously, in July of 1972, the Texas Highway Department revised its construction plans and provided for an expansion of the overpass without notifying appellant. On August 15, 1973, Frio was excavating a pier hole, or wing shaft, at the construction site on the right-of-way of the Loop and drilled into the telephone company’s conduit and buried cables and then filled the excavated pier hole with concrete and also filled approximately ninety feet of conduit with concrete. The concrete was poured very shortly after Frio had discovered that its auger had struck the cable and conduit. Appellant proved that it suffered damages in the sum of $39,302.54 which was not disputed by any evidence of probative value.

The telephone company filed its motion for instructed verdict and its motion for judgment notwithstanding the verdict and both motions were denied by the trial court. The jury found that appellant was contribu-torily negligent and the trial court entered its judgment denying any recovery in behalf of the telephone company.

Appellant has abandoned its claim for damages asserted on the basis of the negligence of Frio and contends that it was entitled to a recovery upon its claim of trespass.

Article 1416, Tex.Rev.Civ.Stat.Ann., provides the following:

“Corporations created for the purpose of constructing and maintaining magnetic telegraph lines, are authorized to set their poles, piers, abutments, wires and other fixtures along, upon and across any of the public roads, streets and waters of this State, in such manner as not to incommode the public in the use of such roads, streets and waters.”

Article 1416, supra, has also been held to apply to telephone lines. Heldt v. Southwestern Bell Telephone Company, 482 S.W.2d 352 (Tex.Civ.App. Corpus Christi 1972, no writ).

The disposition of this case is controlled by Mountain States Telephone & Telegraph Co. v. Vowell Construction Co., 161 Tex. 432, 341 S.W.2d 148 (1960). In Mountain States, supra, the Texas Supreme Court was reviewing a case in which Vowell Construction Company, while preparing an El Paso street for paving, severed a 1515 pair communications cable owned by the telephone company. Mountain States brought a trespass action to recover its damages. The court stated:

“In our opinion, the petitioner telephone company as plaintiff in the trial court pleaded and conclusively established that Vowell Construction Company had committed a trespass for which it was liable in damages.”

In determining liability, the court stated the following:

“Here, the scraper was deliberately and intentionally used in making a cut to the designated subgrade. The telephone cable was lawfully in place. The molesting or severing of the cable was a violation of a property right which gave rise to a cause of action regardless of negligence.”

In the present case, the conduit and cables were lawfully in place pursuant to Article 1416, supra. The fact that the cables were not in the exact location shown on the plat filed with the Texas Highway Department in 1960, is immaterial since the statute makes no such requirement and appel-lee made no investigation to determine the location of the conduit and cables. The hole was deliberately and intentionally drilled to its intended depth for the purpose of providing an excavation for a concrete pier and in the process the telephone company’s cable was molested and severed which was a violation of a property right which gave rise to the cause of action for trespass. It is immaterial that Frio did not intend to cut the cable. The evidence is clear that Frio intended to set the auger in motion to drill a pier hole to a designated depth. By conducting its drilling operations, Frio became liable for all of the foreseeable injuries and damages that resulted. The telephone cable being lawfully in place constituted a property right. When Frio drilled the hole, it was under a duty to avoid molesting that property right and thus avoid severing the cable. The Texas Supreme Court stated in Pioneer Natural Gas Co. v. K & M Paving Co., 374 S.W.2d 214 (Tex.1963), the following:

“We think it sound, in light of the cases hereinafter discussed, to hold that at least where the activity is in an urban street or road, and where an unusual or extraordinary use of the surface is necessary to unearth the pipeline, and where there is no contract, statute, ordinance, or regulation governing the matter, the initial burden is upon the one who excavates or digs up the surface to avoid striking the line or to make reasonable inquiry as to the location of any lines which might be encountered. The duty of the pipeline operator under these circumstances arises, then, when it is requested to alter its lines or their use, when it is asked for information, or when it is otherwise put on such notice that it is required to take particular action to protect the lives or property of others.”

In Pioneer, supra, K & M Paving Company sued the gas company for damages to its earth moving machine when the machine struck a gas pipeline buried in a road on the outskirts of the City of Lubbock. The court in effect held that the paving company did its earth moving at its peril and had a duty to determine what was below an urban street or road before digging. It is common knowledge that roads in urban areas are underlaid with pipes, cables and conduits and a duty rests on the one digging to inform himself of what lies below the surface so that he may avoid injury to the property of others rightfully there.

There is no evidence in this case to indicate that the telephone company knew or should have known that Frio would be drilling a hole in such close proximity to its cables such that a duty would be imposed upon the telephone company to take particular action to protect its property.

We have concluded, and therefore hold, that appellant telephone company established its case as a matter of law by proving that Frio intentionally set its auger into motion and that such auger severed the telephone company’s conduit and cables which were lawfully in place and that the damages inflicted were a violation of a property right of the telephone company.

The testimony relative to damages was clear, positive and direct, and was credible and free from contradictions and inconsistencies and though it came from interested witnesses, such testimony was not controverted by anyone shown to have been an expert or one experienced in the costs of repair and replacement of telephone cables and conduits. We therefore hold that appellant proved its damages as a matter of law to be the sum of $39,302.54.

The trial court should have granted appellant’s motion for judgment notwithstanding the verdict. It thus becomes our duty to enter the judgment which the trial court should have entered.

The judgment of the trial court is reversed and judgment is here rendered that appellant recover from appellee its damages in the sum of $39,302.54 together with interests and costs.


author: ODEN, Justice.

text:
    Thomas Sterling MACKIE, Appellant, v. Norma Faye MACKIE, Appellee.
    No. 8572.
    Court of Civil Appeals of Texas, Texarkana.
    Sept. 5, 1978.
    Rehearing Denied Oct. 3, 1978.
    James C. Allums, Jr., Dallas, for appellant.
    Jesse L. Nickerson, Pittsburg, for appel-lee.
   ODEN, Justice.

The original opinion of this Court handed down on July 25, 1978, is withdrawn and the following opinion is substituted.

Thomas Sterling Mackie (appellant) and Norma Faye Mackie (appellee) were divorced by a decree filed on January 12, 1977, which provided, inter alia, that:

“Respondent [appellant] is awarded the farm, house, farm equipment, cattle, Plymouth automobile and books, and he is required to pay all of the debts on the property after payment of Twelve Thousand, Five Hundred and No/100 ($12,-500.00) Dollars to Petitioner [appellee]. If Respondent does not pay the $12,500.00 to Petitioner within 60 days from the date of entry of this Judgment, all of the above property is awarded to Petitioner. Petitioner required to sell such property to pay debts against it, and is to receive $12,500.00 cash, and to turn over the balance, if any, to Respondent.
“Petitioner shall report to court prior to consummation of any sale."

The next noteworthy entry in the record is July 14,1977, at which time appellee filed a report of sale with the district clerk whereby she advised that she had not been paid the $12,500.00 and that she had sold the farm at a private sale for cash. Appellant filed an objection to the report of sale. A hearing was held on September 22,1977, at which time the court ordered that:

“. . . Petitioner’s [appellee] offered sale be approved as of noon, October 24, 1977, provided such offer is reduced to writing and filed as part of the record with this case within 10 days, further providing that said offer is to be good for a period of 45 days, subject to Court approval.
“. . . Respondent [appellant] has until October 24, 1977, to submit a higher offer, provided said offer is accompanied by a cashier’s check in the amount of 10% of the amount offered by Respondent, said cheek to be payable into the registry of the Court, and said offer subject to Court’s approval.
“. . .in the event an offer is made by Respondent, Petitioner is to have five days, until noon, October 29, 1977, to submit a higher offer, such offer to be accompanied with a 10% deposit in the form of a cashier’s check payable into the registry of the Court.”

Appellant is before the Court complaining of the order of the trial court entered in connection with the report of sale. Appellee filed a motion to dismiss the appeal for want of jurisdiction alleging that the order from which the appeal has been perfected is not a final judgment because it is not to become effective until the happening of some future event. We agree with appellee. Except in instances not applicable herein, an appeal may be prosecuted only from a final judgment. Tex.Rev.Civ.Stat.Ann. art. 2249; North East Independent School District v. Aldridge, 400 S.W.2d 893 (Tex.1966). The order under attack is not final. The trial court retained jurisdiction to entertain subsequent offers to purchase the farm as well as to review the offer produced by appellee. At best, the judgment was to become final only upon the happening of some future event, to-wit, appellant failing to produce a higher offer by October 24, 1977. A judgment that is to become effective only upon the happening of some future event or contingency is ordinarily not a final judgment. Wrather v. Wrather, 154 S.W.2d 955 (Tex.Civ.App. Texarkana 1941, writ ref’d w. o. m.).

The appeal is dismissed at appellant’s costs.


text:
    D. H. OVERMYER, Appellant, v. ELIOT REALTY, INC., Appellee.
    No. 8584.
    Court of Civil Appeals of Texas, Texarkana.
    Sept. 5, 1978.
    Rehearing Denied Sept. 26, 1978.
    Mark Alan Calhoun, Dallas, for appellant.
    Otto B. Mullinax, Mullinax, Wells, Mauzy & Baab, Inc., Dallas, for appellee.
   ODEN, Justice.

On April 2, 1976, D. H. Obermyer filed a bill of review to set aside a money judgment entered against him and in favor of Eliot Realty, Inc. on March 15, 1974. Eliot Realty, Inc. answered, and, in the same proceedings, filed a bill of discovery under Rule 737 of the Texas Rules of Civil Procedure. The citation issued by the court on the filing of the bill of discovery was directed to D. H. Overmyer but was served on his attorney. Subsequent to the filing of the bill of discovery and service thereon, D. H. Overmyer moved for a non-suit, filed a special appearance under Rule 120a and moved to quash the citation. The trial court granted the motion for non-suit and, following a hearing, overruled the motions filed with respect to jurisdiction and directed D. H. Overmyer to appear before the court for examination on oral questions as in ordinary trials. The appeal has been perfected from the order which granted the bill of discovery and overruled the special appearance and motion to quash. Appellant and appellee will be respectively referred to as Overmyer and Eliot.

We must initially determine whether or not we have jurisdiction. Eliot urges that the order from which the appeal has been perfected is not final and appeala-ble. We disagree. An order for discovery after judgment in an independent suit by a judgment creditor seeking to discover assets upon which to levy execution is final and appealable. Dallas Joint Stock Land Bank v. Rawlins, 129 S.W.2d 485 (Tex.Civ.App. Dallas 1939, no writ); Thompson v. Republic Small Business Investment Company, 464 S.W.2d 726 (Tex.Civ.App. Dallas 1971, no writ). This is an independent suit instituted after judgment and the order for discovery is final and appealable.

The order granting Overmyer a non-suit specifically reserved unto Eliot the right to proceed on its bill of discovery. Overmyer contends that the trial court should have dismissed the entire case. We disagree. Affirmative relief can be granted to a defendant such as Eliot in a hearing on a bill of review. R. R. Stolley Corporation v. Quebedeaux, 70 S.W.2d 266 (Tex.Civ.App. Austin 1934, writ dism’d). Once a claim for affirmative relief has been filed, the right of plaintiffs such as Overmyer to move for a non-suit under Rule 164 is limited to their cause of action only. Sandefer v. Sandefer, 466 S.W.2d 31 (Tex.Civ.App. Eastland 1971, no writ). We hold that Eliot’s bill of discovery constituted a “claim for affirmative relief” as that term is used in Rule 164. Eliot had a right to discover what assets Overmyer owned in order to satisfy its judgment. Under the circumstances, Over-myer ⅛ taking a non-suit did not prejudice Eliot’s right to proceed on its bill of discovery and the trial court correctly refused to dismiss the entire case.

Overmyer further contends that the trial court erred in overruling his special appearance and motion to quash citation. The record furnished us for review contained no statement of facts and under such circumstances we must assume that sufficient evidence was introduced to support the ruling of the trial court. Lane v. Fair Stores, 150 Tex. 566, 243 S.W.2d 683 (1951) and Zemke v. Stevens, 494 S.W.2d 227 (Tex.Civ.App. Eastland 1973, no writ).

We have considered all points of error urged by Overmyer and all are overruled. The judgment of the trial court is affirmed.

      . All statutory references are to the Texas Rules of Civil Procedure unless otherwise noted.


author: STEPHEN F. PRESLAR, Chief Justice.

text:
    Bob C. LEWIS, Appellant, v. COUNTY OF EL PASO, Appellee.
    No. 6667.
    Court of Civil Appeals of Texas, El Paso.
    Sept. 6, 1978.

      Joseph (Sib) Abraham, Jr., Duane A. Baker, Charles Louis Roberts, El Paso, for appellant.
    George N. Rodriguez, Jr., County Atty., Michael S. McDonald, Asst. County Atty., El Paso, for appellee.
   OPINION

STEPHEN F. PRESLAR, Chief Justice.

This is a suit for collection of fees of office brought by a Justice of the Peace against a County. Both parties sought summary judgment and the trial Court denied the motion of the Plaintiff and granted the summary judgment motion of the Defendant County. We affirm.

Article 1052, Tex.Code Crim.Proc.Ann., provides in part: “ . . . Four Dollars ($4.00) shall be paid to the Justice of the Peace for each criminal action tried and finally disposed of before him. The Commissioners Court shall not however pay any account or trial fees in any case tried and in which an acquittal is had unless the State of Texas was represented in the trial of said cause by the County Attorney or his assistant, Criminal District Attorney or his assistant and the certificate of said Attorney is attached to said account certifying to the fact that said cause was tried, and the State of Texas was represented, and that in their judgment there was sufficient evidence in said cause to demand a trial of the same.” Appellant seeks to recover under this Statute for some 400 cases which he disposed of as Justice of the Peace. Some 400 individuals were arrested for picketing violations and, over a period of some six weeks, Plaintiff scheduled hearings for each of the defendants, and Plaintiff says in his affidavit attached to his motion for summary judgment: “The Defendants in the above cases duly appeared at the time and place set, but the County Attorney or his assistants failed to appear. Therefore, I called each case and ordered a dismissal in each case because of the nonappearance of any County Attorney.”

The question presented is whether the dismissal of the cases entitles Appellant to payment under the above Statute. The only case deciding the question is an 1889 case by the then Court of Appeals of Texas entitled Brackenridge v. State, 27 Tex.App. 513, 11 S.W. 630. It was held, under Article 1075, predecessor to Article 1052 and having similar language, that a County Judge was not entitled to his fees, the Court saying:

“A county judge is entitled to demand and receive from the county the sum of three dollars for each criminal action tried and finally disposed of before him. Id. art. 1075. He is not entitled to said fee in a ease that is merely dismissed. A dismissal of a case is not a trial of it, within the meaning of the law. A dismissal of a case is to send it out of court without a trial upon any of the issues involved in it. It is a final disposition of that particular case, but not a trial of it. A final disposition of a case does not of itself entitle the county judge to the fee allowed by article 1075, supra. To entitle him to the fee, the case must have been tried and finally disposed of before him. He must both try and finally dispose of it. Such is the plain language of the statute.”

Under the authority of that case and the Statute, Article 1052, we affirm the judgment of the trial Court.

Appellant seeks to question the constitutionality of Article 1052, citing cases which hold that it deprives a defendant in a criminal case of due process of law to subject his liberty or property to the judgment of the court, the judge of which is paid only in the event of a conviction. Appellant is in no position to question the constitutionality of the Statute. He is not a defendant before such a judge and his constitutional rights are not in issue. The grievance complained of is not his. He is not denied recovery because of any unconstitutional provision of the Statute. Rather, he is denied recovery because he has not complied with the Statute and become eligible for payment thereunder in that he has not tried the cases for which he seeks payment.

The judgment of the trial Court is affirmed.


author: HUGHES, Justice.

text:
    HOUSTON GENERAL INSURANCE COMPANY and Gene Smyers d/b/a Gene Smyers Insurance, Appellants, v. LANE WOOD INDUSTRIES, INC. and d/b/a Ranada Mobile Homes, Inc., Appellees.
    No. 17980.
    Court of Civil Appeals of Texas, Fort Worth.
    Sept. 7, 1978.
    Rehearing Denied Oct. 12, 1978.

      McBryde, Bogle & Green and John P. Green, Jr., Fort Worth, for Houston Gen. Ins. Co.
    Cantey, Hanger, Gooch, Munn & Collins and Tolbert L. Greenwood, Fort Worth, for Gene Smyers d/b/a Gene Smyers Insurance.
    Kilgore & Kilgore and Eugene R. Lyerly, Dallas, Shannon, Gracey, Ratliff & Miller and Kleber C. Miller and David E. Keltner, Fort Worth, for appellees.
   OPINION

HUGHES, Justice.

This case involves an action against an insurer on a liability insurance policy and a negligence action against the insurer’s local recording agent. The issues presented on appeal are whether the judgment against the insurer may be supported on the ground of estoppel, contract or reformation and whether the agent was negligent in failing to maintain or secure liability coverage for plaintiff. The trial court rendered judgment for plaintiff.

We affirm.

Houston General Insurance Company appealed from a judgment rendered against it on a general liability insurance policy for $78,191.06 plus interest of 9% from date of judgment. The policy had been issued on June 1, 1968, by its predecessor, General Insurance Corporation, to Ranada Mobile Homes, Inc. which was then engaged in the manufacture and sale of mobile homes. The $78,191.06 amount reflects the jury’s verdict of $61,505.00 plus interest at the legal rate from June 1, 1973. The judgment further provides that in the event it is not satisfied by Houston General for any reason, Houston General’s local recording agent Gene Smyers, doing business as Gene Smyers Insurance Company, is to be alternatively liable in negligence for $61,505.00 plus interest of 9% from date of judgment. Smyers has also appealed.

Lane Wood Industries, Inc. brought suit against Houston General and Smyers after it had purchased the manufacturing operation and other assets of Ranada, including its prepaid insurance. The general liability policy had been issued to and showed Rana-da as the named insured. Four days before the policy’s expiration date of June 1, 1969, three persons were injured in an explosion and fire in a mobile home manufactured by Lane Wood after its purchase of Ranada’s assets. Lane Wood seeks to recover the amount it spent defending and settling the negligence and products liability suit brought in Bell County, Texas, by the injured persons. Houston General provided a defense for Ranada in that action but refused to defend Lane Wood because it had not known of the asset sale and had not endorsed its consent to the assignment on the policy. Such endorsement of consent was required by the terms of the policy:

9. Assignment: Assignment of interest under this policy shall not bind the company until its consent is endorsed hereon.

Judgment was entered in Lane Wood’s favor on the jury’s verdict. Defendants’ motions for judgment on the verdict and, alternatively, for judgment non obstante ve-redicto were overruled.

The purchase and assignment of Ranada’s assets occurred on December 20, 1968, well before the expiration date of the policy. By the terms of the sale Ranada assigned to Lane Wood all of its assets, including the right to use the name “Ranada Mobile Homes, Inc.” No Ranada stock was sold. Although the selling corporation existed for at least a year after the sale, it did not engage in any manufacturing. Lane Wood operated the manufacturing plant under Ranada’s name and used Ranada’s checks, bank accounts and stationery for making premium payments and for correspondence. George Crowder, one of three Ranada stockholders and the president and manager of the operation before the sale, continued as president after the sale. It is undisputed that Lane Wood held the operation out to the public as Ranada Mobile Homes, Inc. in all respects. There was testimony that an outsider would not have detected any change in the operation.

Smyers had handled nearly all of Rana-da’s insurance policies for some three or four years. On a routine visit to the manufacturing operation he was informed by Crowder that “we’ve sold out” and that Dick Finlay would contact him. They did not discuss details of the sale, although Smyers testified that until January 1971 he thought the sale was a stock sale. Neither Smyers nor Houston General ever inquired about the nature of the sale, although there is testimony by Crowder and Finlay that they would have disclosed the nature of the sale if asked. Finlay, the Lane Wood vice president in charge of insurance matters, did meet with Smyers for the purpose of confirming that he wanted Smyers to continue handling the business for Ranada. He left the business with Smyers and authorized him to renew coverage upon expiration.

No one ever requested that Lane Wood be substituted as the named insured and the change was never made.

After the sale and before the policy expired, Houston General paid other claims for property damage under this policy and some workmen’s compensation claims under a policy issued to Ranada. Although Finlay testified he had no correspondence with Houston General from January to May 1969, Houston General’s engineers made a routine inspection of the plant after the sale. Houston General’s business records show it learned of the sale of the company to Lane Wood on February 13, 1969. After learning of the sale Smyers and his employees continued to service the policies, having numerous conversations and meetings with Lane Wood — some at Lane Wood’s offices. Houston General has not tendered to Lane Wood any premiums paid because it has paid out more after the sale in claims under the policy than had been collected in premiums.

There is testimony Houston General would not have been willing to extend “split-risk” coverage to Lane Wood for only that operation. In fact, before June 1, 1969, Houston General refused to renew coverage even to Ranada. Smyers renewed the coverage for Ranada with another company before he learned of the nature of the sale.

SUIT AGAINST HOUSTON GENERAL ON THE INSURANCE POLICY

Lane Wood seeks to recover against Houston General on the policy only. It has not asserted any negligence theory against Houston General based on the allegations of negligence of Smyers. Lane Wood failed to obtain a jury finding that Houston General had waived its right to insist that the policy did not cover the loss or that the policy did not provide coverage to Lane Wood because of Lane Wood’s unilateral mistake. Under the pleadings Lane Wood may prevail only on a theory of contract or reformation because of mutual mistake or estoppel.

Houston General first complains of the overruling of its motion for judgment on the verdict. It asserts the verdict does not support a judgment against it on either of these theories.

A. Contract or Reformation

Insurance contracts may be reformed to speak the true agreement between the parties. Fireman’s Fund Indem. Co. v. Boyle General Tire Co., 392 S.W.2d 352 (Tex.1965).

The equitable reformation of a written contract is based upon the premise that a contract was actually made, but the written memorandum thereof, because of a mutual mistake, does not truly reflect the actual agreement of the parties. “Reformation is a proper remedy when the parties have reached a definite and explicit agreement, understood in the same sense by both, but, by their mutual or common mistake, the written contract fails to express this agreement.” Champlin Oil & Refining Company v. Chastain, 403 S.W.2d 376, 382 (Tex.1965).

The jury found there was a contract, express or implied, to provide coverage for the manufacturing operation. But it also found that Houston General and Smyers did not know the sale to Lane Wood was an asset sale before the policy expired. We hold that the jury findings do not support a judgment for Lane Wood on the ground of contract or reformation because there is no finding of a prior agreement that Lane Wood be the named insured. “A provision not contained in the preceding oral agreement cannot be inserted in the reformed written agreement under the guise of reformation.” Continental Oil Company v. Doornbos, 402 S.W.2d 879, 883 (Tex.1966).

The jury’s findings that neither defendant knew of the nature of the sale provide an alternate basis for our holding. These findings are controlling over the findings that a contract existed between Lane Wood and the defendants to provide coverage for the operation, that the failure to provide coverage to Lane Wood was because of a mutual mistake, and that all parties intended that there be coverage for the operation.

We reject Lane Wood’s contention that the findings that the defendants were ignorant of the nature of the sale are immaterial and evidentiary. We hold that these findings defeat Lane Wood’s cause of action based on contract or reformation.

B. Estoppel

Houston General would avoid being es-topped to deny coverage based on defendants’ ignorance that the sale was of assets. It argues that the party sought to be es-topped must have had full knowledge of the material facts at the time of his representation, act or conduct claimed to constitute the basis of the estoppel.

Lane Wood alleged that Houston knew there had been “a sale,” and the evidence to that effect is undisputed. We hold that the defendants’ ignorance that the sale was of assets does not defeat Lane Wood’s cause of action based upon estoppel.

Where a person, with actual or constructive knowledge of the facts, induces another by his words or conduct to believe that he acquiesces in or ratifies a transaction, or that he will offer no opposition thereto, and that other, in reliance on such belief, alters his position, such person is estopped from repudiating the transaction to the other’s prejudice. Champlin Oil & Refining Company v. Chastain, 403 S.W.2d 376, 385-86 (Tex.1965) (emphasis added).

No issue on constructive knowledge was submitted or requested. A finding will be deemed found by the trial court in support of the judgment when supported by the evidence. Tex.R.Civ.P. 279; Fidelity & Cas. Co. of New York v. Jefferies, 545 S.W.2d 881 (Tex.Civ.App. — Tyler 1976, writ ref’d n. r. e.). We hold there is evidence to support an implied finding on the issue of constructive knowledge. Houston General and its local recording agent had notice of facts sufficient to put it on inquiry as to nature of the sale. Accordingly, it is charged with constructive knowledge of the sale of the assets. The case of Johnson v. Prudential Insurance Co., 506 S.W.2d 238, rev’d on other grounds, 519 S.W.2d 111 (Tex.1975), is not controlling because the plaintiff in that case asserted that the defendant was on notice as a matter of law.

Other cases cited by Houston General on the estoppel issue do not compel a different holding: Hallmark v. United Fidelity Life Insurance Co., 155 Tex. 291, 286 S.W.2d 133, 136 (1956) (also permits estoppel on the basis of constructive knowledge); Zurich Insurance Co. v. Bass, 443 S.W.2d 371 (Tex.Civ.App. — Dallas 1969, no writ); Baker v. Highway Ins. Underwriters, 209 S.W.2d 979 (Tex.Civ.App. — El Paso 1947, writ ref’d n. r. e.); Williams v. Texas Employers Ins. Ass’n, 135 S.W.2d 262 (Tex.Civ.App. — Waco 1940, writ ref’d) (no knowledge which might put insurer on inquiry); Texas Employers Ins. Ass’n v. Bottoms, 200 S.W.2d 418 (Tex.Civ.App. — Fort Worth 1947, no writ) (clear case of actual knowledge so that no issue of constructive knowledge was raised); Dallas County Hosp. Dist. v. Pioneer Casualty Co., 402 S.W.2d 287 (Tex.Civ.App. — Fort Worth 1966, writ ref’d n. r. e.) (no estoppel issue); Traders and General Insurance Company v. Lange, 354 S.W.2d 178 (Tex.Civ.App. — Texarkana 1962, writ ref’d n. r. e.) (special policy provision); Hunt v. W. O. W. Life Ins. Soc., 153 S.W.2d 857 (Tex.Civ.App. — Fort Worth 1941, writ ref’d) (false statements on insurance application); Traders’ & General Ins. Co. v. Emmert, 76 S.W.2d 208 (Tex.Civ.App. — Waco 1934, writ ref’d) (no allegations or proof of estoppel); Federal Bldg. & Sales Co. v. Commercial Std. Ins. Co., 381 S.W.2d 940 (Tex.Civ.App. — Waco 1964, writ ref’d n. r. e.) (no estoppel because conduct occurred after the loss and when insurer still had no knowledge of facts); Moffett v. Employers’ Liability Assur. Corp., 286 S.W. 508 (Tex. Civ.App. — Galveston 1926, no writ) (lack of agent’s authority to bind insurer); Maryland Casualty Co. v. Palestine Fashions, Inc., 402 S.W.2d 883 (Tex.1966) (named insured failed to furnish names of new owners after agent requested them).

Houston General further argues there is no finding that it represented that coverage was provided to Lane Wood for the operation. Such a finding may be implied under Rule 279 in support of the judgment if there is evidence to support it. Having already held that Houston General is charged with constructive knowledge of the asset sale, we further hold that there is evidence to support an implied finding that Houston General by its words, acts, deeds and silence represented that it provided insurance coverage to Lane Wood.

We overrule Point of Error No. One and hold that the jury’s findings support a judgment against Houston General on the ground of estoppel.

C. Evidence to Support Jury Findings

In Points Nos. Two and Three Houston General complains of the overruling of its motion to disregard certain jury findings. It asserts there is no evidence to support the findings that it or its agent, by any combination of words, acts, deeds and silence, represented to Lane Wood that Houston General provided insurance coverage for the manufacturing operation.

Houston General argues it never told Lane Wood it was providing coverage to Lane Wood for the manufacturing operation and that innocent silence will not work an estoppel. But under the special issues submitted, a representation may result from any combination of words, acts, deeds and silence. It was not necessary that there be evidence of express statements to Lane Wood that coverage was provided to Lane Wood. After learning of a sale, Houston General paid claims to Ranada, made routine inspections and continued to accept premiums paid on Ranada checks. We have held that Houston General had a duty to inquire about the sale: its silence is not innocent.

Houston General cites Hidalgo County v. Pate, 443 S.W.2d 80 (Tex.Civ.App. — Corpus Christi 1969, writ ref’d n. r. e.). But Hidal-go presents no issue of constructive knowledge and is not controlling. Nor is American Insurance Co. v. First Savings & Loan Ass’n, 434 S.W.2d 170 (Tex.Civ.App. — Fort Worth 1968, writ ref’d n. r. e.). In that case this court emphasized that the mortgagee, as one of the named insureds, was under no duty to act when it learned that written notice of cancellation had been sent to the mortgagor-owner but not to it as also required by the policy. The facts in that case do not reveal any relationship between the insurer and the mortgagee-insured which might be construed as a representation by the mortgagee to the insurer that the mortgagee had acquiesced in the termination of the policy as to its interest. The mortgagee was not estopped from asserting that policy had not been terminated as to it.

We hold there is evidence to support the findings that the defendants represented to Lane Wood that coverage was provided for the operation. Points Nos. Two and Three are overruled.

Point No. Four complains there is no evidence that Lane Wood believed and relied upon representations by it and Smyers that coverage was provided for the operation.

Finlay, who was in charge of Lane Wood’s insurance matters, testified he believed Lane Wood was insured. Lane Wood continued making premium payments— though on Ranada checks — and Houston General accepted them until the end of the policy term.

Houston General also argues that Lane Wood had the means but failed to acquire knowledge of the need to obtain an endorsement on the policy and therefore may not rely on the doctrine of equitable estop-pel.

We reject this contention. The doctrine of estoppel is intended to promote justice and the reliance of the party asserting it must have been in good faith. It is true there is no estoppel where the knowledge of the parties is equal. Richey v. Miller, 142 Tex. 274, 177 S.W.2d 255 (1944). It is also true that “[a] party claiming an estoppel must have used due diligence to ascertain the truth of the matters upon which he relies in acting to his detriment.” Barfield v. Howard M. Smith Company of Amarillo, 426 S.W.2d 834, 838 (Tex.1968). But the jury found that Lane Wood relied on the representations of the defendants and there is evidence to support the finding of reliance. No issue was submitted or requested on the question of due diligence or the reasonableness of Lane Wood’s reliance. This is an issue of fact, and in this instance we must presume a finding by the trial court in support of the judgment. Tex.R.Civ.P. 279. We overrule Point No. Four.

The Fifth Point of Error complains there is no evidence Lane Wood acted to its detriment upon representations of the defendants that coverage was provided. Houston General argues there is no evidence whether or not Lane Wood attempted to obtain coverage from another company.

Finlay testified that the Houseman agency, which wrote insurance for other Lane Wood divisions, did not write any insurance for Lane Wood on the operation from October 1968 to June 1969. There is also evidence that Lane Wood decided to leave the coverage “where it was” and continued to pay the premiums. We overrule Point No. Five.

Houston General’s Sixth and Seventh Points complain there is no evidence that Lane Wood and the defendants intended that Houston General would provide coverage for the operation.

Houston General does not seriously dispute the evidence to support the findings of an intention to provide coverage for the operation. It does dispute the interpretation Lane Wood would have us give the term “manufacturing operation” so as to include an intention to provide coverage to Lane Wood as named insured for the operation.

The court’s charge contained the following definitions:

“MANUFACTURING OPERATION” means the mobile home operation in Alvarado, Texas, known as Ranada Mobile Homes owned by the Plaintiff, Lane Wood Industries, Inc.
“INSURANCE COVERAGE” means the same coverage provided by the terms of Houston General Policy number GLA 31 51 58.

We do not construe, the findings complained of to include an intention to provide coverage to Lane Wood as named insured. We overrule these points, however, and hold there is evidence to support the findings, when construed to mean an intention to provide coverage to the operation with Ra-nada as the named insured.

In Point No. Eight Houston General contends there is no evidence that there was a contract, express or implied, between Lane Wood and the defendants to provide insurance coverage for the manufacturing operation. Under this point the parties renew their debate about the meaning of “manufacturing operation.”

We have already held that the finding that the defendants did not know of the sale of assets defeats Lane Wood’s cause of action based upon a theory of contract or reformation. However, even if we were to accept Lane Wood’s assertion that the definition means coverage to Lane Wood for the operation owned by Lane Wood, we find no evidence to support the finding of such an express or implied contract.

“A contract implied in fact rests upon consent. It is . . .an agreement between the parties. It does not arise out of an implied legal duty or obligation, but out of facts from which consent may be inferred.” (Stone Company, Inc. v. Carminati, 317 S.W.2d 78, 80 (Tex.Civ.App. — Fort Worth 1958, no writ). A contract or agreement may not be implied contrary to the intentions or understanding of the parties. Lewis v. Hill, 409 S.W.2d 946 (Tex.Civ.App. —Amarillo 1966, no writ).

Houston General’s final point contends there is no evidence that the insurance policy failed to provide coverage to Lane Wood’s manufacturing operation because of a mutual mistake.

To constitute a mutual mistake which will support a reformation the writing must fail to reflect the preceding oral agreement of the parties due to a mutual mistake. Champlin Oil, supra. The record reflects there was no preceding oral agreement to provide coverage to Lane Wood.

We overrule Points Nos. Eight and Nine. Although we agree with Houston General’s contention that there is no evidence of a contract or mutual mistake, we find no error in the judgment against Houston General. We hold that Houston General is es-topped from asserting that the insurance policy does not provide coverage to Lane Wood for the manufacturing operation. The judgment against it is affirmed.

NEGLIGENCE ACTION AGAINST AGENT

Smyers concedes that an insurance agent who undertakes, but fails, to obtain coverage for his client and does not notify the client of his failure is liable for any resulting loss. Burroughs v. Bunch, 210 S.W.2d 211 (Tex.Civ.App. — El Paso 1948, writ ref’d). But Smyers argues he had no duty to Lane Wood and, alternatively, that there was no breach of any such duty.

Smyers groups together Points of Error Nos. One through Seven concerning the trial court’s alleged error in overruling his motion for judgment non obstante veredic-to. He asserts he did not know that Lane Wood was the owner of the manufacturing operation, had not undertaken to obtain coverage for Lane Wood, and therefore owed no duty to Lane Wood until it notified Smyers it was the new owner. Smyers further complains that there is no evidence he was negligent in failing to issue a new policy to Lane Wood, to investigate the sale, to warn or advise Lane Wood, and to endorse the policy to reflect the change of ownership.

A. Existence of Duty

Smyers argues that Lane Wood did not rely on him as its insurance agent during the policy period and had no course of dealing with him which would entitle it to rely on him. Smyers contends that in order to impose a duty upon an agent, the agent must ordinarily have provided insurance protection for the client without consulting the client.

The authorities cited by Smyers are not in point: McCall v. Marshall, 398 S.W.2d 106 (Tex.1965) (agent had no duty, without request, to extend coverage to an additional location of which he had knowledge, in the absence of prior dealings in which he had acted before consulting the client); Langley v. Pacific Indemnity Co., 135 Ga.App. 29, 217 S.E.2d 369 (1975) (agent not liable in tort where no agency relationship exists between insured and agent acting solely as representative of insurance company).

Smyers contends that the client must make his instructions clear and that other jurisdictions require the new owner to make a new application. Here Smyers cites Agee v. Travelers Indemnity Company, 396 F.2d 57 (10th Cir. 1968) (agent had no notice that divorce he knew to be pending had actually taken place); Moller v. Niagara Fire Ins. Co., 54 Wash. 439, 103 P. 449 (1909); and Hill v. Grandey, 132 Vt. 460, 321 A.2d 28 (1974) (agent was told only to obtain coverage provided to previous owner and had no reason to know of off-premises barbecue business which had never been included under coverage before). These cases do not raise the issue of notice of actual facts.

Even if the agent has actual knowledge, Smyers contends, he has no duty to act without a specific request from the client. In Smith v. Orion Insurance Company, 298 F.2d 528 (10th Cir. 1961) on which he relies, the agent was told of a contemplated change of pilots. The court held that this statement to the agent, made before any change had occurred, was not the equivalent of an application to make a change of the named pilot. Because the agent in Smith had knowledge of a contemplated change only, the case does not support Smyers’ contention.

The jury found that Smyers had no actual knowledge of the nature of the sale. Smyers seeks to avoid being charged with a duty to investigate the sale by asserting that Lane Wood was itself charged with notice of the terms of the policy because Finlay had possession of the policy and then had the Houseman agency review it. But Smyers failed to meet his burden of proof on the issue of contributory negligence on the part of Lane Wood. The jury failed to find that Lane Wood was negligent in not notifying Smyers. In effect, the jury refused to charge Lane Wood with notice.

We hold that Smyers had a duty to investigate the sale and is therefore charged with notice that the sale was an asset sale. It is undisputed that Smyers was informed by Crowder that Ranada had “sold out.” And Smyers admitted that he wondered whether the coverage was still in force. “[Wjhatever is sufficient to put a person on inquiry is sufficient to affect him with notice of such facts as he might be presumed to learn upon reasonable inquiry.” Coleman Mut. Aid Ass’n v. Clark, 63 S.W.2d 270, 272 (Tex.Civ.App. — Austin 1933, no writ); Capital Glenn Mining Co. v. Industrial Accident Comm’n, 124 Cal.App. 79, 12 P.2d 122 (1932); Jonas v. Bank of Zodiak, 162 F.Supp. 751, 17 Alaska 755 (D.C.Alaska 1958); Michigan Mutual Liability Company v. Shuford & McKinnon, Inc., 292 F.Supp. 290 (S.D.Miss.1968).

Smyers relies on Tollefson v. American Family Insurance Co., 302 Minn. 1, 226 N.W.2d 280 (1974). But that case held only that an agent had no ongoing duty to investigate whether the client’s daughter had ceased to be a student and thus a member of the household for purposes of an automobile liability policy.

Smyers further argues he had no duty to Lane Wood because it did not rely on him as its agent. Smyers has not attacked the jury’s finding that Lane Wood relied upon Smyers’ representation “by any combination of his words, acts, deeds and silence that Houston General provided insurance coverage for the manufacturing operation.” Nor does he dispute the testimony of Finlay that Lane Wood relied on him.

The essence of Smyers’ argument is that Lane Wood did not reasonably rely on him as is required by Colonial Sav. Ass’n v. Taylor, 544 S.W.2d 116 (Tex.1976). Smyers’ argument ignores the fact that the jury failed to find that Lane Wood was negligent in failing to notify Smyers of the asset sale. We think this is the equivalent of a finding of reasonableness on Lane Wood’s part. Even if it were not, we would be compelled to deem that the trial court found the reliance was reasonable. Tex.R.Civ.P. 279.

We hold that under the circumstances Smyers had a duty to provide coverage to Lane Wood for the manufacturing operation. Points One through Three are overruled.

B. Breach of Agent’s Duty

Smyers also argues there is no evidence of his breach of the alleged duty to Lane Wood. Smyers contends there must be expert testimony to establish the professional standard of care for an insurance agent. Houseman testified he did not know what the normal and customary practice for an insurance agent was upon learning of a “sale.” He did state that the correctness of the named insured was essential and that the normal and customary practice upon learning of a change of ownership would be to attempt to retain the business. Smyers testified he knew the importance of “having the named insured properly listed,” that he had told his employee, Mrs. Onstott, he had “doubts about the coverage” and that he was waiting to hear whether to continue it in force.

Smyers urges that the rule requiring expert testimony to establish the standard of care in medical malpractice cases should be applied to insurance agents. Lane Wood contends there is no Texas case which treats the insurance field as a learned profession requiring expert testimony in negligence actions.

We do not think that expert testimony was required as to the normal and customary practice when an agent finds out there has been a “sale” by the corporation insured under a liability policy. This is a matter within the realm of ordinary skill and diligence. Alternatively, we hold that Houseman’s testimony is sufficient, if necessary, to establish the standard of care. Houseman testified the agent would customarily talk with the new owner and inquire as to the named insured, or the party at risk. We hold there is evidence of a breach of duty by Smyers to Lane Wood.

We overrule Points Four through Seven and hold that Smyers was on inquiry as to the nature of the sale and owed a duty to Lane Wood. We further hold there is evidence Smyers was negligent in failing to investigate the sale, to warn or advise Lane Wood, and to endorse the policy to reflect the change in ownership.

In Points Nos. Eight through Twelve Smyers complains the trial court erred in overruling his motion for new trial because certain special issues contained a prejudicial comment on the evidence and because the evidence was “insufficient” to support the findings that Smyers was negligent in failing to 'issue a new policy, investigate the type of sale, warn Lane Wood of the need to obtain a new policy or obtain an endorsement, or to endorse the old one to reflect the change in ownership.

The alleged prejudicial comment complained of was included in the following negligence issues:

8A. Do you find . . . that . Smyers . . . failed to investigate the type of sale involved, so as to properly advise . . . Lane Wood . and handle the necessary changes in the insurance contract? (Emphasis added.)

8B was not to be answered unless the jury had answered 8A affirmatively:

Do you find . . . that the failure of . .. Smyers ... to investigate the type of sale involved, so as to properly advise . . . Lane Wood and handle the necessary changes in the insurance contract was negligence? (Emphasis added.)

8C was likewise not to be answered unless 8B was answered affirmatively:

Do you find . . that the failure of Smyers ... to investigate the type of sale involved, so as to properly advise . . . Lane Wood and handle the necessary changes in the insurance contract was a proximate cause of Lane Wood . . . suffering the loss? (Emphasis added.)

We think this conditional form of submission eliminates any possibility of prejudice from the use of the term “properly” which Smyers so vigorously objects to on the ground that by informing the jury that Smyers had not properly advised Lane Wood and that Lane Wood would have heeded its advice it therefore improperly assumed an unproven material fact and tainted all the other negligence findings as well.

We reject this contention and overrule Point No. Eight. “In deciding whether a particulár part constitutes a comment on the evidence, the charge is considered as a whole. The judge . . . may assume the truth of a disputed fact in a special issue so conditionally submitted that it will not be answered until the jury, in answer to a preliminary issue, has found the truth of the assumed fact proposition.” R. McDonald, 3 Texas Civil Practice § 12.03.2 (Rev.1970); Highland Park State Bank v. Continental Nat. Bank, 300 S.W.2d 304 (Tex.Civ.App. — Fort Worth 1957, writ ref’d n. r. e.).

We also overrule Points Nine through Twelve. We hold that the evidence was sufficient to support the jury’s findings of negligence in failing to investigate the type of sale, issue a new policy or endorse the old one or warn Lane Wood of the need to obtain a new policy or secure an endorsement.

Judgment is affirmed.


text:
    Oscar E. REED and Doris E. Reed, Appellants, v. WHITE, WELD & COMPANY, INC., Appellee.
    No. 8592.
    Court of Civil Appeals of Texas, Texarkana.
    Sept. 12, 1978.

      Oscar E. Reed, pro se.
    John Andrew Martin, Carrington, Coleman, Sloman, Johnson & Blumenthal, Dallas, for appellee.
   CORNELIUS, Chief Justice.

Oscar Reed and Doris Reed brought suit against Charles Townsend, Jr., White, Weld & Company, Inc. and others for damages. They alleged that White, Weld & Company, on the order of Townsend, wrongfully sold certain securities. The district court rendered interlocutory summary judgment in favor of White, Weld & Company and all other defendants except Townsend. The claim against Townsend proceeded to trial, and the jury, having been charged by the court that Townsend did not have authority to order the sale of the securities, found that he acted maliciously in doing so, but also found that the Reeds suffered no damage. In this appeal the Reeds complain only of the denial of their claim against White, Weld & Company. It is urged that they were entitled to a trial of that claim because material issues of fact existed as to whether White, Weld & Company was negligent in selling the securities on the instructions of Townsend.

The Reeds, along with several other persons, were named as devisees and legatees in the will of Albert L. Reed. Upon Albert Reed’s death, Charles N. Townsend, Jr., Charles B. Reed and the appellant, Oscar Reed, were appointed joint independent executors as provided by the will. The assets of the estate included several stocks and bonds of the Missouri-Pacific Railroad Company, St. Louis & San Francisco Railroad Company and Sante Fe Industries. The will provided that securities could not be sold except upon the consent of all three of the joint independent executors. Sometime after probate of the will, the three executors decided that it was necessary to sell some of the stocks and bonds to pay taxes, attorneys fees and other expenses, and they engaged White, Weld & Company to act as broker in the sale. In addition, and apparently as a partial partition and distribution of the assets, the executors instructed White, Weld & Company to transfer title to the securities in question to'Oscar and Doris Reed. To effect the transfer to the Reeds, it was necessary that White, Weld & Company be furnished with a tax waiver, an affidavit of domicile, a power of attorney and letters testamentary. Before these were supplied, however, Townsend changed the instructions, and without the joinder of the other executors, ordered White, Weld & Company to proceed with the sale of the securities, including those involved here which had been set aside to the Reeds and which Townsend had previously instructed be transferred to them. White, Weld & Company sold the securities on July 2,1975. The proceeds were deposited to the account of the Albert L. Reed Estate and apparently distributed to the beneficiaries.

The Reeds make no claim for the value of the stock, but seek to recover only the amount of interest which the securities would have earned them during their life expectancy had they not been sold, which is represented to be the sum of $24,000.00. In their brief, the Reeds make the following statement:

“The action is limited to the income for the reason that the market value of the stocks and bonds sold by the Defendant, and the cash obtained from the sale thereof was paid to Charles N. Townsend, Jr., . . . and distributed to the beneficiaries of Albert L. Reed under the terms of his will.”

The Reeds were entitled to a trial of their claim unless the pleadings, summary judgment affidavits and the answers to interrogatories on file demonstrated conclusively that one or more of the essential elements of their cause of action was lacking, and that consequently White, Weld & Company was entitled to judgment as a matter of law. Tex.R.Civ.P. 166-A; 4 McDonald’s, Texas Civil Practice, Sec. 17.26.2, p. 133.

White, Weld & Company contends that the cause of action was precluded for several reasons, but we find it unnecessary to discuss all of the contentions because the record reveals that, even though the sale of the securities was wrongful, the Reeds have been paid all damages legally recoverable by the cause of action they pleaded.

The measure of damages for the conversion of personal property, where the property is shown to have a market value, is the market value at the time of the conversion, plus interest from said date and, in some cases, special damages resulting from the withholding of the property or properly incurred by the owner in the pursuit of it. American Surety Co. v. Hill County, 254 S.W. 241 (Tex.Civ.App. Dallas 1923), affirmed, 267 S.W. 265 (Tex.Com.App.1924, judgmt. adopted); Lincoln v. Packard, 25 Tex.Civ.App. 22, 60 S.W. 682 (1900, no writ); 14 Tex.Jur.2d, Conversion, Sec. 24, pp. 27, 28; C. McCormick, Law of Damages, Sec. 123, at 463, 464 (1935). The injured party is thus fully compensated, because he can go into the market and make himself whole by purchasing property of like character as that of which he has been wrongfully deprived. Lincoln v. Packard, supra; Griffith v. Burden, 35 Iowa 138. With specific reference to the wrongful sale of stocks or bonds, and because of their fluctuating value, the prevailing view modifies the rule somewhat, and holds that the true and just measure of damages is the highest intermediate value of the stock between the time of its conversion and a reasonable time after the owner has received notice of the conversion to enable him to replace the stock. Galigher v. Jones, 129 U.S. 193, 9 S.Ct. 335, 32 L.Ed. 658 (1889); In re Salmon Weed & Co., 53 F.2d 335 (2d Cir. 1931); 79 A.L.R. 379 (1932); Gervis v. Kay, 294 Pa. 518, 144 A. 529 (1929); 63 A.L.R. 297 (1929); Annot., 31 A.L.R.3d 1286 (1970); 63 A.L.R. 305 (1929). And if the conversion is willful, fraudulent or attended with gross negligence, the owner may recover the highest value between the date of conversion and the filing of suit. De Shazo v. Wool Growers Central Storage Co., 139 Tex. 143, 162 S.W.2d 401 (1942); Ligon v. E. F. Hutton & Company, 428 S.W.2d 434 (Tex.Civ.App. Dallas 1968, writ ref’d n. r. e.); Patterson v. Wizowaty, 505 S.W.2d 425 (Tex.Civ.App. Houston-14th Dist. 1974, no writ).

In this case, it is undisputed that the securities had a market value, but the Reeds have not sought to recover that value. Indeed, they concede that such value has been paid. There is no pleading for special damages of any kind, but only for interest which, it is said, the Reeds could have earned if they still held the securities.

In the absence of special circumstances which might dictate otherwise, the owner of a converted security is not entitled to recover either its face value or the interest or dividends which might have been earned upon holding it to maturity. Memphis v. Brown, 20 Wall. 289, 87 U.S. 264, 22 L.Ed. 264 (1874). If the owner desires to receive earnings or recover the full matured value, he has the obligation to replace the lost security and hold the wrongdoer responsible for any proper loss in making the replacement. Memphis v. Brown, supra; Gervis v. Kay, supra; Baker v. Drake, 53 N.Y. 211 (1873).

It follows that the Reeds’ cause of action was lacking in the essential element of damage. Under the circumstances, the district court properly rendered summary judgment denying them a recovery.

The judgment of the trial court is affirmed.


author: OSBORN, Justice.

text:
    The AETNA CASUALTY AND SURETY COMPANY, Appellant, v. Maurilio ALMUINA, Appellee.
    No. 6749.
    Court of Civil Appeals of Texas, El Paso.
    Sept. 13, 1978.
    Rehearing Denied Oct. 11, 1978.
    Shafer, Gilliland, Davis, Bunton & McCol-lum, Inc., Connell Ashley, Gary C. Riley, Odessa, Richard D. Naylor, Pecos, for appellant.
    Warren Burnett, Associated, Warren Burnett, Richard C. Abalos, W. Ruff Ah-ders, Richard J. Clarkson, Odessa, for appel-lee.
   OPINION

OSBORN, Justice.

This is an appeal from a judgment awarding workmen’s compensation benefits based upon jury findings of total and permanent incapacity. We affirm.

There is no real dispute in this case about the injured employee’s incapacity, but the sole issue is with regard to who was the employer at the time of the accident. J & J Farms, Inc. and Balmorhea Feeders, Inc. are both corporations operating feedlots in Reeves County. In 1973 and 1974, J & J Farms, Inc. was owned by Joe Lee McMahon and members of his family. Balmorhea Feeders, Inc. was owned one-half by the McMahon family and one-half by the Wein-acht family. These companies had different management and different compensation carriers, and there is no evidence that employees were moved from one company to the other with some regularity as existed in Dodd v. Twin City Fire Insurance Company, 545 S.W.2d 766 (Tex.1977).

In April, 1973, Mr. Almuina went to work as a truck driver for J & J Farms, Inc. He was a good employee and worked steadily until the end of April, 1974. At that time, one of the trucks was no longer needed and so Mr. McMahon told Mr. Almuina that another employee was needed by Balmo-rhea Feeders, Inc. and suggested that he see about a job at that feedlot. Mr. Almui-na started to work at Balmorhea Feeders, Inc. on the last day of April and sustained a back injury the next day. His salary was paid by J & J Farms, Inc. through May 15th, and he never was placed on the payroll or paid anything by Balmorhea Feeders, Inc.

During the two days he was at Balmo-rhea Feeders, he worked under the direction and supervision of their manager and a machine operator. The Aetna Casualty and Surety Company, the carrier for J & J Farms, Inc., contended in the trial Court that Mr. Almuina was a loaned employee of Balmorhea Feeders, Inc. The jury found he was an employee of J & J Farms at the time of receiving his injuries. No attack is made on that finding. In answer to a question inquiring if Mr. Al-muina was a borrowed employee of Balmo-rhea Feeders, the jury answered “He was not a borrowed employee.”

The Appellant presents one point of error urging that the trial Court erred in overruling its motion for judgment notwithstanding the verdict because there was no evidence or insufficient evidence that Mr. Al-muina was not a borrowed employee of Balmorhea Feeders.

This point would appear to complain of a negative finding on a special issue on which the Appellant had the burden of proof. Properly interpreted, the answer is nothing more than a failure or refusal by the jury to find from a preponderance of the evidence that Mr. Almuina was a borrowed employee, and means, in law, that the Appellant failed to carry its burden of proving the fact inquired about in this issue. C. & R. Transport, Inc. v. Campbell, 406 S.W.2d 191 (Tex.1966). The negative answer does not require any evidence to support it on appeal and, technically, it cannot be attacked by a “no evidence” point. Traylor v. Goulding, 497 S.W.2d 944 (Tex.1973); Espinosa v. Hudson, 531 S.W.2d 248 (Tex.Civ.App. — Tyler 1975, no writ); Washington v. Aetna Casualty and Surety Company, 521 S.W.2d 313 (Tex.Civ.App.— Fort Worth 1975, no writ); Bell v. Buddies Super-Market, 516 S.W.2d 447 (Tex.Civ. App. — Tyler 1974, writ ref’d n. r. e.); Hatched and Calvert, “Some Problems of Supreme Court Review,” 6 St. Mary’s L.J. 303, 323 (1974). But from the argument in the brief, we conclude that Appellant’s real contention is that the issue was established as a matter of law, and we will consider the point of error. O’Neil v. Mack Trucks, Inc., 542 S.W.2d 112 (Tex.1976); Meyerland Company v. Palais Royal of Houston, Inc., 557 S.W.2d 534 (Tex.Civ.App. — Houston [1st Dist.] 1977, no writ).

Such review is a two-step procedure; first, to see if there is any evidence to support the jury finding, and, if not, to see if the contrary proposition is established as a matter of law. The first step requires that we examine the record for evidence that supports the jury finding while ignoring all evidence to the contrary. O’Connor, “Appealing Jury Findings,” 12 Hous.L.Rev. 65 at 78-81 (1974).

The Court, in its charge, defined a “borrowed employee” as being “one who, while in the general employment of one employer, is subject to the right of another employer or his agents to direct and control the details of the particular work inquired about and [who] is not merely cooperating with suggestions of such other employer.”

When we consider only the evidence to support the jury finding, we find some evidence which would indicate Mr. Almuina was hired as an employee of Balmorhea Feeders and thus no longer in the general employment of J & J Farms and subject to the direction and control of another employer within the Court’s definition. Joe Lee McMahon testified: “I thought he was with Balmorhea Feeders.” He said he sent Mr. Almuina to Balmorhea Feeders to “see if he could get a job over there.” Mr. McMahon apparently thought the job was being terminated at J & J Farms because he said he (McMahon) gave him (Almuina) his notice (of termination). When he was asked how it was determined who was to terminate Mr. Almuina, Mr. McMahon said: “I guess I drew the black marble.”

The general manager for Balmorhea Feeders said Mr. Almuina was under his supervision and control, and that “we hired him or tried him out on a probationary basis, so to speak.” One of the owners, Mr. Charles Weinacht, said Balmorhea Feeders did not take people under their control unless they hired them.

Such evidence would be sufficient to support a finding that Mr. Almuina was in fact Balmorhea Feeders’ very own employee and not a borrowed employee, and thus it supports the negative answer to Special Issue No. 2. The fact that at the time of the injury Mr. Almuina was still on the payroll of J & J Farms, Inc. is not absolutely controlling as to the issue of employment. Employers Casualty Company v. American Employers Insurance Company, 397 S.W.2d 292 (Tex.Civ.App. — Amarillo 1965, writ ref’d n. r. e.).

There is also substantial evidence that there was no agreement between the two companies that Mr. Almuina, as an employee of J & J Farms, was to be loaned to Balmorhea Feeders. Thus, the first step has not been met to set aside the jury finding. Even if it was, we would not hold under the record in this case that the second step has been met and would not hold that the evidence establishes as a matter of law that Mr. Almuina was a borrowed servant. Dodd v. Twin City Fire Insurance Company, supra.

The Appellant’s Point of Error No. 1 is overruled. The judgment of the trial Court is affirmed.