author: McDONALD, Chief Justice.

text:
    H. H. STORMS and wife, Julia Storms, Appellants, v. Grady TUCK, Jr., Tyson Smith, Roland Walters, and Luther Graham, Appellees.
    No. 5822.
    Court of Civil Appeals of Texas, Waco.
    March 30, 1978.
    Rehearing Denied May 4, 1978.
    Joe Mike Egan, Jr., Kerrville, for appellants.

      Joe Grady Tuck, Richard C. Mosty, Kerr-ville, for appellees.
   OPINION

McDONALD, Chief Justice.

This is an appeal by plaintiffs Storms and wife from judgment decreeing defendants Tuck, et al, vested easement rights of ingress and egress across plaintiffs’ lands, and denying plaintiffs’ petition for injunction against defendants.

Plaintiffs Storms sued defendants, Tuck, et al alleging plaintiffs own a described 50 foot strip of land extending from the Band-era Highway to and along the side of a 10 acre tract conveyed by plaintiffs to Ruth Mills December 21, 1976; that plaintiffs also conveyed Mrs. Mills a roadway easement over the 50 foot tract December 21, 1976, which was incident to the 10 acre tract; that on February 16,1977 Mrs. Mills attempted to convey defendants an easement over the 50 foot tract, but such instrument conveyed nothing because easement over the 50 foot roadway could only be conveyed as a part of the 10 acre tract.

Plaintiffs sought judgment enjoining defendants from using the 50 foot roadway, and cancellation of cloud on plaintiffs’ title to such 50 foot roadway.

A schematic diagram follows:

Trial was before the court. Plaintiffs Storms owned 848 acres of land; on December 21,1976 they sold and conveyed 10 acres on which their home was situated to Ruth Mills; on the same date by separate instrument they “GRANTED, CONVEYED,

and by these presents do GRANT and CONVEY unto the said Ruth Mills * * her heirs and assigns, the free and uninterrupted use, liberty, privilege and easement of passing in, on, upon and along a certain way” (the 50 foot right of way A to B on schematic diagram) “together with free ingress and egress and regress to and for the said Ruth Mills, her heirs and assigns, and her tenants, by foot, with carts, wagons, carriages, automo-. biles and other vehicles, horses, mules or livestock, as by her shall be necessary or convenient at all times and seasons forever, in, along, upon and out of said way; TO HAVE AND TO HOLD all and singular the rights and privileges as aforesaid unto her, the said Ruth Mills, her heirs and assigns, to her proper use and behalf, in common however, with Grantors herein H. H. Storms and wife Julia Storms, their heirs and assigns”.

On February 16, 1977 Mrs. Mills sold and conveyed the house and 9.24 acres of the 10 acres to Mr. and Mrs. Teal, together with “all her right title and interest in and to one certain easement” conveyed from the Storms to her on December 21, 1976.

And on February 16, 1977 Mrs. Mills sold and conveyed to Grady Tuck, Jr., et al, a described 50 foot strip off the south side of the 10 acre tract containing .76 acre, and “an undivided interest in and to that one certain easement” conveyed from the Storms to her on December 21, 1976.

After purchase of the .76 acre defendants Tuck, et al brought in road building equipment and proceeded to turn the .76 acre tract into a road, and also improved some of the Storms’ easement road. While defendants’ employees were building the road on the .76 acre tract and improving the easement roadway, plaintiff Storms watched and observed and permitted improvements to his property in the removal of a tree and the building of a cattle ramp against the easement road. There is evidence plaintiffs received assistance from the County in maintaining the easement road. There is evidence defendants spent nearly $6000. on the .76 acre and adjoining easement road.

The trial court rendered judgment decreeing defendants Tuck, et al, vested easement rights of ingress and egress across plaintiffs’ lands (A-B on the schematic diagram) and denied plaintiffs’ petition for injunction.

Plaintiffs appeal on 3 points:

1) The trial court erred in holding defendants have a valid easement to reach their .76 acre tract.
2) The trial court erred in holding defendants have a valid easement to continue beyond the .76 acre tract to reach lands owned by them adjacent to the .76 acre tract.
3) The trial court erred in denying their action to quiet title and for injunction against defendants’ use of the purported easement.

Plaintiffs on December 21, 1976 conveyed Ruth Mills a 10 acre tract and on the same date by separate instrument conveyed to her a broad easement over an existing 50 foot roadway (A-B on the schematic diagram). The trial court found that the granted easement was appurtenant to the 10 acre tract. See Stuart v. Larrabee, (Beaumont) NRE, Tex.Civ.App., 14 S.W.2d 316.

Plaintiffs contend the easement was appurtenant to the 10 acre tract which contained a house, and when the .76 acre tract was severed from the 10 acre tract without a house, that under Adams v. Rowles, 149 Tex. 52, 228 S.W.2d 849, the easement as pertained to the .76 acre was extinguished. We believe the easement appurtenant was for the entire 10 acres and for any portion thereof.

Plaintiffs further contend that even if defendants have a valid easement to reach the .76 acre tract, that they do not have valid easement to go on to adjacent lands owned by them, citing Bickler v. Bickler, Tex., 403 S.W.2d 354 as dispositive.

Here plaintiffs knew of, acquired, and cooperated in the building of the road on defendants’ .76 acre; had knowledge defendants had expended considerable money, on the roadway, and requested defendants’ workmen to build them a cattle ramp, remove a tree, and do other work on their property and the easement, all at the expense of defendants. Prior thereto plaintiffs had been provided work on the easement by the County. Defendants have spent nearly $6000. in building the roadway on their .76 acre, and in improving the roadway on the balance of the easement.

The doctrine of estoppel in pais applies when the owner of the servient estate, as here, allows the owner of the dominant estate to spend money on the servient tract. Drye v. Eagle Rock Ranch, Inc., Tex., 364 S.W.2d 196, 210; See also: Coleman v. Forister, Tex., 514 S.W.2d 899, 904; Harris v. Rabe, (Waco) NWH, Tex.Civ.App., 375 S.W.2d 919, 922. And the purpose of estop-pel is to prevent injustice to and protect persons who have been misled. Roberts v. Haltom City, Tex., 543 S.W.2d 75, 80.

Under the record plaintiffs are es-topped to deny their consent to defendants the use of their .76 acre tract in whatever manner defendants desire, and are estopped to deny defendants’ use of the easement right-of-way to reach such .76 acre tract as well as adjacent lands owned by them.

The trial court was authorized to deny plaintiffs the relief they sought.

All plaintiffs’ points are overruled.

AFFIRMED.

      . Bickler v. Bickler holds that right-of-way easements appurtenant to a dominant estate can only be used for the purpose of that estate; that the easements’ use is limited to the dominant estate; and cannot be used to reach other lands of the grantee.


source: Caselaw Access Project

author: BISSETT, Justice.

license: Public Domain

text:
    Lawrence HOOVER, Appellant, v. H. C. COOKE and Total Exploration Company, Appellee.
    No. 1232.
    Court of Civil Appeals of Texas, Corpus Christi.
    March 31, 1978.
    Rehearing Denied May 24, 1978.

      Richard A. Hall, Gary, Thomasson, Hall & Marks, Corpus Christi, James P. Hart, Austin, for appellant.
    Miller William Meredith, Jr., Walter Clay Cooke, Meredith & Donnell, Corpus Christi, for appellee.
   OPINION

BISSETT, Justice.

This is a suit to impose a constructive trust upon certain mineral interests in several oil, gas and mineral leases in Frio County, Texas. H. C. Cooke was plaintiff and Lawrence Hoover was defendant in the court below. Following a jury trial, judgment was rendered which decreed that plaintiff pay to defendant the sum of $63,-574.04 as reimbursement for all costs and expenses incurred in the acquisition and development of the leases and upon such payment, “H. C. Cooke shall recover and own all of the right, title and interest of Lawrence Hoover” in the leases. Lawrence Hoover has appealed.

Cooke alleged that he made a study of the Pearsall Field, in Frio County, Texas, prepared a report thereon, and in April, 1974, delivered the Report to Hoover “in confidence and exclusively for the use of Southland Royalty Company”, and that Hoover used the Report as a basis for the acquisition of interests in certain oil, gas and mineral leases in the Pearsall Field. He further alleged that prior to the acquisition by Hoover of interests in the involved oil, gas and mineral leases, a business and social relationship between him and Hoover existed which “endured for more than twenty years”; that such relationship resulted in the creation of a confidential relationship between them; and that Hoover violated the duties and obligations that arose out of that relationship of trust and confidence by intentionally using his (Cooke’s) confidential information contained in the Report and other confidential information subsequently furnished him to purchase, sell and hold the affected oil, gas and mineral leases. Cooke prayed that a constructive trust be imposed upon all of Hoover’s interests in the leases.

The jury, among other findings, found: 1) a confidential relationship existed between Cooke and Hoover at the time Cooke presented his Pearsall Field Report to Hoover (No. 1); 2) a confidential relationship existed between Cooke and Hoover during the period of time between the date Cooke presented his Pearsall Field Report to Hoover and August 31, 1975 (No. 3); and 3) Cooke, his associates or employees, provided confidential information to Hoover between the date Cooke presented the Report to Hoover and August 31, 1975. (No. 4).

Hoover contends in points 1 and 4 that the trial court erred in rendering judgment in Cooke’s favor because, as a matter of law, there was no evidence to support the jury’s findings that a confidential relationship existed between Cooke and him, and that there was no evidence that he (Hoover) utilized confidential information received from Cooke in acquiring the leases in question.

In considering the “no evidence” points, we are required to view the evidence in its most favorable light in support of the jury’s findings, considering only the evidence and permissible inferences which support the findings and rejecting the evidence and inferences contrary thereto. Miller v. Riata Cadillac Company, 517 S.W.2d 773 (Tex.Sup.1974).

Cooke, age 61, and Hoover, age 50, are both independent geologists who have lived in Corpus Christi, Texas, for more than twenty years prior to April, 1974. Both are graduates from the University of Texas with a Bachelor of Science Degree in Geology. Cooke graduated in 1941 and Hoover graduated in 1948. Both were highly respected in their professional field, and stood on equal footing as far as education, ability and experience is concerned. Neither had any special ability or expertise which was not possessed by the other. Neither had any dominance over the other.

The parties first became acquainted with each other in 1952 when Hoover was employed by Pontiac Refining Company as a geologist. At that time Cooke was a consultant geologist for Pontiac. Both left the employ of Pontiac sometime during the mid 1950’s. Aside from being employed by the same company, Cooke and Hoover were not shown to have any business or social relationships with each other during the several years that they worked for Pontiac.

In the mid 1950’s, Cooke, Hoover, B. Cochran and B. C. Garnett worked together on a uranium prospect in Karnes County, Texas. Uranium leases were obtained, which resulted in a profit to them. At or about the same time that the uranium leases were being acquired in Karnes County, Texas, Cooke engaged Hoover to make a survey of the Jackson outcrop from Live Oak County to Grimes County, in an attempt to locate uranium deposits. Cooke paid Hoover “for his time and expenses”. Nothing productive came out of the survey. Following the completion of the survey relating to the Jackson outcrop, Hoover and Cooke went to the “four-corners” area of Arizona, Utah, Colorado and New Mexico, to, in the words of Cooke, “examine uranium prospects and mines being actively worked”. They spent about three weeks on the trip. According to Cooke, the trip was partly pleasure, but “mostly business”. There is no evidence that any kind of business relationship between Cooke and Hoover grew out of this trip.

After terminating his consulting arrangement with Pontiac, Cooke became an independent geologist, as reflected by his statement:

“I went entirely on my own, and I don’t think I have done any consulting work since 1960. It has been purely an individual effort on my part to originate prospects.”

In 1971 or 1972, Hoover, at Cooke’s request, wrote a letter to the Texas Water Control Board • and expressed his concern over the dumping of toxic wastes into Corpus Christi Bay. The record does not reveal the action, if any, which was taken by the Board.

Cooke told the jury that as a result of his previous association with Hoover, he considered Hoover a personal friend, and he felt that Hoover would keep anything that he showed him in confidence. Hoover stated that he regarded Cooke as a friend. He further stated that he expected Cooke to believe that if Cooke presented a geological report to him as a representative of South-land Royalty that he (Hoover) would hold the contents of the report “on a confidential basis for Southland Royalty Company”, because “that was my obligation to Southland Royalty Company”.

The land area here involved consists of lands and oil, gas and mineral leases thereon situated in the Pearsall Field, in Frio County, Texas. The field, in the vicinity of Pearsall, Texas, produces oil from the Austin Chalk Formation. The formation is some 375 feet thick. It dips towards the Gulf at the rate of 200 feet per mile. It is divided into four zones; 1) the Upper Shaly Zone, which is 40 feet thick; 2) the Upper Fractured Zone, which is 175 feet thick; 3) the Lower Shaly Zone, which is 96 feet thick; and 4) the Lower Fractured Zone, which is 70 feet thick. A greater part of the production comes from the Upper Fractured Zone, but there has been some production from the Lower Fractured Zone. The other two Zones generally are non-productive. The formation has no primary porosity and where oil is found, the production is due to secondary porosity caused by faulting, fracturing and joints due to structural movement. It was discovered in 1933 and was developed in two phases, 1933-1941 and 1948-1956.

Particularly of interest in this suit is the east flank of the field, an area about 11 miles long and 5 miles wide. The typical well in the field would produce most prolifically initially, but would rapidly decline to a daily production of three or four barrels in most instances. As a result of the extensive drilling in the Pearsall Field and the required reporting of such activities to the appropriate state agency, the nature and extent of the Pearsall Field area anticline in the Austin Chalk Formation and its production potential based upon conventional drilling techniques then in vogue became matters of common knowledge.

Through 1973, the 129 wells in the field produced 6,370,000 barrels of oil for an average of 49,000 barrels per well. The price for oil from 1933 to 1956 varied from $1.50 to $2.44 per barrel. The operators of the wells, at best, broke even. Drilling virtually ceased in 1956, and did not resume until September, 1974.

During the first phase, 1933-1941, the wells were completed in the Austin Chalk formation by setting casing and “shooting” the wells at selected intervals in 300 feet of open hole with nitroglycerin, followed by a small amount of acid. During the second phase, 1948-1956, the completion practice was to drill through selected zones in the formation, set casing and then pump a modest amount of acid in about 400 feet of open hole. The completion methods used in the first phase resulted in higher initial flows and greater ultimate recoveries of oil than those used in the second phase.

The technique of “fracturing” was introduced into South Texas in the middle 1950’s. Several wells were fractured in open hole and the resulting ultimate recoveries were equal to, or greater, than the early recoveries when the wells were shot with nitroglycerin. Most of the wells that were fractured were wells that would not respond to acidizing. In the late 1960’s improved fracturing techniques were perfected.

Cooke made a detailed study of the Pear-sall Field in 1954. He concluded that several thousand acres on the east flank of the field were proven to be productive, but it was not then feasible to develop this area due to the price of oil prevailing at that time; however with the dramatic increase in the price of oil in 1973, he reviewed his study. He prepared a report thereon dated April, 1974. The Report was in essay form and was supported by footnotes containing maps, well data, cross-section plotting, core records, electric logs, reservoir details, record of production from each well in the field, production curves, his conclusions, and concurring opinions of two other geologists. Everything in the Report except the contours shown on the maps, the cross-section plotting, the opinions of the two geologists and Cooke’s own conclusions, was prepared from either public records or from articles in publications pertaining to the Pearsall Field.

Cooke did not have the funds to develop the area himself; therefore he prepared the Report with a view toward obtaining buyers of leases with substantial funds to invest, such as wealthy individuals or independent oil companies, who, hopefully, would drill new wells in the field. Cooke was funded by J. Lee Youngblood, a prominent Dallas oilman, who, in association with Cooke, purchased numerous leases in the field in an attempt to put drilling deals together. Cooke then decided to present these leases to oil companies who were financially able to drill and complete wells in the Austin Chalk Formation. The first company contacted was Southland Royalty Company. In early May, 1974, Cooke, who had heard that Hoover was the representative for Southland in the Pearsall area, telephoned Hoover and asked him if he was such a representative. Hoover answered in the affirmative, and Cooke told him that he “had a prospect, some acreage and some ideas on the flank of the Pearsall Field”. When asked if Southland would be interested, Hoover answered:

“I will let you know.”

Southland showed interest and Cooke delivered a copy of his Report to Hoover in connection with Cooke’s offer to assign the Harris Lease (4,000 acres) to Southland. There was no discussion of the Report between Cooke and Hoover at that time other than a general discussion of its generalities and potential. Cooke testified:

“Q Were you submitting that report to Lawrence Hoover as an individual or as an agent, as he told you, for Southland Royalty Company?
A As an agent for Southland Royalty Company.
Q If he wasn’t representing Southland Royalty Company, would you have ever shown him that report?
A No, not at all.”

Cooke further testified that his purpose in contacting Hoover was “to sell the Harris lease” to Southland, and that he “did not take it to Mr. Hoover per se”.

Hoover submitted the Report to South-land and recommended that it acquire the north 500 acres of the 4,000 acre Harris lease and that it drill two wells on the assigned acreage as a test of the techniques advocated by Cooke in the Report. South-land, after a study of the Report, made a counter offer to Cooke; as a result, South-land acquired the lease as to 2,000 acres and obtained an option on an additional 500 acres. Cooke received a cash consideration and an overriding royalty for the assignment. Southland kept the Report. Cooke, after completing his deal with Southland, considered the copy of the Report to be the property of Southland. He said: “when you buy the lease you get the Report”. Cooke’s concept of what should be done in order to produce oil profitably from the Austin Chalk is best described in a letter which Hoover wrote to Southland, when he recommended that Southland acquire the north 500 acres of the Harris lease and drill two wells thereon. The letter, in part, reads, as follows:

“. . . Mr. Cooke reasonably concludes that application of the ‘Pine Island’ technique of selectively perforating and acid-fracturing the several separate oil bearing zones, within the Chalk would result in even better yields and that such yields would be profitable at today’s improved prices for crude . . . ”

At or about the same time that Cooke was negotiating with Southland concerning the Harris lease, Cooke, who had acquired other leases in the Pearsall Field, was also attempting to sell the leases to other oil companies. He contacted ten such companies and delivered a copy of the Report to each. Five companies purchased leases from Cooke; each kept a copy of the Report with the consent of Cooke. The remaining five companies did not purchase a lease from Cooke; they returned all copies of the Report.

Under the agreement between Hoover and Southland Royalty, Hoover was to receive a 3% overriding royalty on all leases acquired by Southland which were originated by Hoover. In addition, it was also agreed between them that Hoover was free to acquire leases for himself and to the exclusion of Southland once the leases had been submitted to and refused by South-land Royalty. Hoover did not tell Cooke of such an agreement. Southland assigned Hoover a 3% overriding royalty in the Harris lease. That lease is not involved in this suit.

Southland began drilling on the Harris lease in September, 1974. Some of the other companies who had purchased leases from Cooke also began to drill shortly thereafter. From that date until November, 1974, when Cooke left on a seven month’s vacation (sometime referred to in the record as a “fishing cruise”), Cooke and Hoover exchanged information concerning development operations in the field. During this time, Southland asked Hoover to locate unleased acreage near the Harris lease. Hoover called Cooke, told him of Southland’s request, and asked the name of a lease broker to assist him. Cooke did not voice any complaint or opposition, but recommended Leroy Hoskins, who had been working for Cooke as a broker in the field since April, 1974. Hoover sought Hoskins’ services whereupon Hoskins called Cooke and got his permission to work for Hoover and Southland. Hoskins located the Burle-son tract which was not then under mineral lease. Hoover called Cooke and asked if he would mind if “we” purchased it. Cooke told him that it would be all right if he (Cooke) was assigned a 1% overriding royalty. Southland leased the land for oil development. Southland assigned a 1% overriding royalty to Cooke. Hoover explained the assignment by stating that at the time Southland acquired the Burleson lease the Harris lease was only two months old and that Southland was still relying on the Report, and that it seemed fair to Southland at that time to assign an overriding royalty to Cooke. Southland also assigned a 2% overriding royalty in the Burleson lease to Hoover. Cooke did not seek to recover Hoover’s overriding royalty in this suit. Hoskins also located a tract that was owned by Mannas and Johnston for Southland. Cooke, when he found out that Southland proposed to lease the tract, called Hoover and told him: “I’m already negotiating a deal on this”; whereupon, Hoover told Hos-kins “to cease negotiations” for this particular tract. Hoskins complied with the request. Cooke later leased the Mannas and Johnston tract, which proved to be productive.

Cooke’s office was occupied by Mrs. Phyllis Angel, his secretary, and by Mr. Charles Williams, an independent geologist, during the time that Cooke was away on vacation.. Before Cooke left, he instructed his secretary to give Hoover and certain other people who were associated with Cooke, upon request, any information in the office relating to the Pearsall Field. Mrs. Angel testified that during that interval, Hoover was in the office frequently and that Hoover would give her drilling reports on the wells which Southland was drilling on the Harris lease, and she would give him “reports what Bruce Fox’s wells were doing on his Man-nas and Johnston lease”. She also stated that Hoover made copies of maps relating to the Pearsall Field. She further testified that while no restriction or limitations were placed on the use of the information contained in the Report by the first “eight or ten” persons who purchased leases from Cooke, those persons who were later contacted as prospective assignees of Cooke were delivered copies of the Report with the following limitation:

“If you decide to buy this lease, then you may use the Report. Otherwise, you may not.”

Mrs. Angel did not specify or identify any information or data, if any, which was set out on the maps. Mrs. Angel did not testify as to any contents in the drilling reports on the Mannas and Johnston lease. She stated that she did not know whether Hoover utilized any of the information obtained by him from Cooke’s office in acquiring any lease in the Pearsall Field.

Mr. Williams testified that he knew that Hoover was Southland’s representative; that Cooke had sold some acreage to South-land; that Hoover came to the office during Cooke’s absence; and that he gave Hoover anything he asked for because he knew that when Cooke “sells a man a deal, he accommodates him by giving him any additional information he may need to . give him a better idea to drill up his prospect”. He also stated that when Hoover came by the office, he “got the big base map of the area which just has the surface and wells and leases spotted on it”, and he would take it to his office and would “spot it up to date”. The map was not a “subsurface geological map”. Williams stated that he did not know from his own personal knowledge if Hoover used any of the information which he obtained from Cooke’s office in evaluating the “Hicks” lease; that geologists do “pretty freely” exchange information on logs, wells production information, and the like; and that much of this information is required to be made public by the Railroad Commission. Williams believed that he gave Hoover a map that had some geological information on it, which he called a “maverick” map, but he neither knew who made it nor just what was shown thereon; such a map was not introduced in evidence.

Hoover testified in detail concerning the information which he obtained from either Cooke or his office from April, 1974 until August, 1975. He was very specific in that respect. According to his testimony, he obtained from Cooke, or from Mrs. Angel or from Williams, the following items and information: 1) a copy of a map which had been included in the Report as an exhibit; 2) a copy of a blank base or ownership map of the Pearsall Field; 3) one or two copies of a cross section that had been included in the Report as exhibits; 4) one or two copies of the drilling progress reports on the Fox and Holland wells No. 1 and 2, and the same information on the Mannas and Johnston wells; 5) a copy of a map bearing the name of Bruce Fox designated at the bottom as “H. C. Cooke, geologist”; 6) a “slant-hole drilling” article on the Pearsall Field area published in the Journal of Petroleum Geology; 7) two summaries of well drilling and completion costs; and 8) “a stack of electrical logs”. The items referred to in 1), 5), 6) and 7) above were personally delivered to Hoover by Cooke. Hoover testified that the only reason for obtaining the copy of the map, which was included as an exhibit in the Report, was because:

“Southland Royalty had asked me to recommend a location for the initial well on the Harris lease, and I was in a hurry to recommend such a location to them.”

At that time, Hoover did not have ready access to the Report and its exhibits since they were then in Southland’s office in Midland, Texas.

Fargason Energy, Inc. (who is not a party to this suit), as lessee, acquired an oil, gas and mineral lease from David W. Hicks, et al, as lessor. The lease was dated May 14, 1975, covers 1660 acres in the Pearsall Field, and will henceforth be referred to as the “Hicks” lease. It is located 5 to 6 miles east of the Harris lease. In late May or early June, 1975, the president of Fargason Energy, Inc., contacted Hoover to see if he was interested in acquiring the Hicks lease. Hoover submitted the offer to Southland, but the latter refused to buy it. Thereafter, and in early June, 1975, Hoover, for his own account, purchased the Hicks lease from Fargason Energy, Inc. Five wells were drilled and completed on the lease. Hoover then engaged Mr. Frank N. McMillan, to buy other unleased acreage on the east flank of the Pearsall Field. McMillan acquired several leases, all of which were submitted to Southland. Those refused by Southland were purchased by Hoover. All of the leases originally obtained by McMillan except the Clyde Cox and Margaret Johnson leases were eventually assigned to parties other than Southland. Hoover retained either overriding royalties or interests in the working interest of those leases.

According to Hoover, twenty wells had been completed on the east flank of the Pearsall Field between the fall of 1974 and June, 1975, and twenty-nine wells were drilling or had announced locations. Cooke’s testimony was that some eighty-five wells had been drilled in the area during that period of time. By January, 1975, Cooke and his associates had acquired oil, gas and mineral leases on about 14,000 acres in that portion of the Pearsall Field which Cooke believed to be highly productive. By early September, 1975, Hoover had acquired interests in about 15,000 acres in the area that Cooke also thought was productive. This acreage included the Harris lease and three other leases (the Burle-son lease of 200 acres, the Cox lease of 793 acres and the M. Johnston lease of 1,758 acres), which were then owned by South-land; Hoover owned an overriding royalty in each lease by virtue of assignments from Southland. Cooke sought to recover the overriding royalties on both the Cox and the M. Johnston leases.

Hoover testified that the maps contained in the Report and a copy of a map contained therein which he later obtained from Cooke’s office were useful in deciding the location for Southland’s No. 1 Harris well. He said that he had a draftsman add information on to the base map which he obtained from Cooke’s office so as to extend it to the area of the Hicks lease and east of the lease, but at that time he did not get the base map to buy leases, since there was no geological information on the map. In January, 1975, Hoover hired a man to make the well information on the map current. With respect to the use of the drilling cost reports of the Pearsall wells which Cooke furnished him, Hoover said that he already knew the costs of drilling a well from his work for Southland operations in connection with the drilling of the first well on the Harris lease.

Cooke, Williams and Hoover, all independent geologists, agreed that the kéy to the drilling of new wells in the Pearsall Field in 1974-1975 was Cooke’s concept of fracturing the new wells by the techniques developed in the late 1960’s. They further agreed that all of the information necessary to justify such drilling was supplied by a mere reading of the Report.

The Court, in Peckham v. Johnson, 98 S.W.2d 408 (Tex.Civ.App.—Fort Worth 1936, aff’d in 132 Tex. 148, 120 S.W.2d 786), at page 416, construed the term “confidential relationship” as;

“ . . . covering every form of relation between parties wherein confidence is reposed by one in another, and he relies and acts upon the representations of the other and is guilty of no derelictions on his own part . . . ”

A “confidential relationship” is a “two-way” street; one party must not only trust the other, but the relationship must be mutual and understood by both parties, as emphasized in Furr’s, Inc. v. United Specialty Advertising Company, 385 S.W.2d 456 (Tex.Civ.App.—El Paso 1964, writ ref’d n. r. e., cert. denied, 382 U.S. 824, 86 S.Ct. 59, 15 L.Ed.2d 71 (1965)), in these words:

“[C]onfidential relationship is a two-way street: if the disclosure is made in confidence, the ‘disclosee’ should be aware of it. He must know that the secret is being revealed to him on the condition he is under a duty to so keep it . . . ”

The term “constructive trust” was defined in Talley v. Howsley, 142 Tex. 81, 176 S.W.2d 158, 160 (1944), as follows:

“ . . . ‘A constructive trust is a relationship with respect to property, subjecting the person by whom the title to the property is held to an equitable duty to convey it to another, on the ground that his acquisition or retention of the property is wrongful and that he would be unjustly enriched if he were permitted to retain the property’.”

A constructive trust does not arise because of an intention to create it by the parties involved. “It is imposed by law because the person holding the title to property would profit by a wrong or would be unjustly enriched if he were permitted to keep the property”. Omohundro v. Matthews, 161 Tex. 367, 341 S.W.2d 401 (1960).

A confidential relationship does not of itself give rise to a constructive trust, but an abuse of confidence rendering the acquisition or retention of property by one person unconscionable against another suffices generally for the imposition of a constructive trust upon the affected properties. The courts are careful not to limit the rule or the scope of its application by a narrow definition of confidential relationships. An abuse of confidence within the rule may be an abuse of either a technical fiduciary relationship, i. e., attorney and client, guardian and ward, joint adventurers, partner and partner, trustee and beneficiary, etc., or of an informal relationship where one person trusts in and relies upon another, whether the relationship is moral, social, family or purely personal. FitzGerald v. Hull, 150 Tex. 39, 237 S.W.2d 256 (1951); 76 Am.Jur.2d, Trusts, § 228.

While the tendency of the courts is to construe the facts presented liberally in favor of the confider against the confidant in determining whether a confidential relationship exists for the purpose of raising a constructive trust where there is an abuse of the information gained by the confidant, nevertheless, a constructive trust “must be used with caution” because it “does not arise on every moral wrong” and “it cannot correct every injustice”. Pope v. Garrett, 147 Tex. 18, 211 S.W.2d 559, 562 (1948).

Although it is well established that confidential relationships may, and often do, arise informally from “moral, social, domestic or purely personal” relationships, it is equally well established that mere subjective trust alone is not enough to transfer a relationship into one of trust and confidence that will constitute a confidential relationship which will dictate the imposition of a constructive trust. Thigpen v. Locke, 363 S.W.2d 247 (Tex.Sup.1962). The fact that one businessman trusts another does not create a constructive trust. Tyra v. Woodson, 495 S.W.2d 211, 213 (Tex.Sup.1973).

Of particular importance to the disposition of this case are the observations made in Consolidated Gas & Equipment Co. v. Thompson, 405 S.W.2d 333 (Tex.Sup.1966), where the Court, speaking through Justice Greenhill, at page 336, said:

“The fact that people have had prior dealings with each other and that one party subjectively trusts the other does not establish a confidential relationship. Thigpen v. Locke, supra. That opinion reasoned that ‘[bjusinessmen generally do trust one another, and their dealings are frequently characterized by cordiality....' "

Also of importance to the disposition of this appeal is the well established rule that in arm’s-length transactions between two businessmen where both stand on equal footing so far as education, ability, experience and business acumen is concerned, as is the case here, each party must exercise due care for the protection of his own interests, and a failure to do so is not excused by mere subjective trust or confidence in the honesty and integrity of the other party. Courseview, Inc. v. Phillips Petroleum Co., 158 Tex. 397, 312 S.W.2d 197 (1957). The fact that a party unilaterally has placed confidence in another is not sufficient to excuse the failure to adequately protect his own interests when the means to do so are readily at hand. Lindsey v. Dougherty, 60 S.W.2d 300 (Tex.Civ.App.-Amarillo 1933, writ ref’d).

After carefully reviewing the evidence and permissible inferences as a whole most favorably to Cooke, we hold that there is no evidence of that type of confidential relationship between Cooke and Hoover envisioned by our appellate courts that would impose a constructive trust. There is no evidence which will permit or justify, under the guidelines laid down by our Supreme Court, as hereinbefore noted, the imposition of a constructive trust on Hoover’s interests in the leases here involved which would divest Hoover of such interests and vest the same in Cooke because of a violation of any relationship which existed between them. Points 1 and 4 are sustained.

Hoover particularly complains of that portion of the judgment which divested him of his interests in the Clyde Cox and the Margaret Johnson leases. He maintains that he acquired his interest in those leases from Southland under his agreement with Southland, and that Cooke had no lawful right to question either of those transactions. We agree. The Cox tract (793 acres) was leased by the landowners, as lessors, to Frank N. McMillan, as lessee, on June 6, 1975, and the Margaret Johnson tract (1,758 acres) was leased by the landowners, as lessors, to McMillan, as lessee, on June 7, 1975. At that time, McMillan was searching for unleased land in the Pearsall Field on behalf of Hoover. At Hoover’s request, the leases were submitted to Southland, who purchased them. Hoover and McMillan each received a 2½% overriding royalty under each lease. We hold that the overriding royalties acquired by Hoover under the Cox and Johnson leases constituted compensation which he was entitled to receive under his agreement with Southland. No basis was shown for divesting Hoover of his interests in those leases and vesting the same in Cooke. Point 18 is sustained.

In view of our sustaining Hoover’s points 1, 4 and 18, the judgment of the trial court must be reversed. Consequently there is no need to dispose of Hoover’s remaining points.

The judgment of the trial court is reversed and judgment is here rendered that H. C. Cooke, plaintiff-appellee, take nothing by his' suit against Lawrence Hoover, defendant-appellant.

It is the further judgment of this Court that the cashier’s check No. 431526 in the amount of $63,574.07, payable to the order of Lawrence Hoover, and received by the District Clerk of Nueces County, Texas from W. C. Cooke on January 28, 1977, be returned by the Clerk to W. C. Cooke.

REVERSED AND RENDERED.


author: ROBERTSON, Justice.

text:
    Wallace HOLYFIELD, Appellant, v. MEMBERS MUTUAL INSURANCE COMPANY, Appellee.
    No. 19494.
    Court of Civil Appeals of Texas, Dallas.
    April 4, 1978.
    Rehearing Denied May 2, 1978.
    James E. Brown, Briggs & Brown, Dallas, for appellant.
    Tom J. Stollenwerck, Moore & Peterson, Dallas, for appellee.
    Richard S. Geiger, David B. Irons, Thompson, Coe, Cousins & Irons, Dallas, amicus curiae brief for Texas Auto. Ins. Service Office.
   ROBERTSON, Justice.

Wallace Holyfield sued Members Mutual Insurance Company, seeking recovery of Personal Injury Protection (PIP) benefits for his son, who was injured in a collision between Holyfield’s motorcycle, which he was riding, and an automobile. Although two automobiles were listed as “insured vehicles” under the policy, the motorcycle was not listed. Separate PIP premiums were paid for the two automobiles, but no premium was paid regarding the motorcycle. The trial court rendered a take-nothing judgment for the insurance company, and Holyfield now appeals. We affirm.

The principal question on this appeal is whether an insured may recover PIP benefits for injuries sustained while operating an owned vehicle not listed as an insured vehicle under the policy, and for which no premium has been paid. The policy in this case expressly excludes coverage of injuries sustained while “occupying” a vehicle owned by the named insured which is not an “insured motor vehicle.” The policy defines “insured motor vehicle” to mean:

An automobile described in the policy to which bodily injury liability coverage applies and for which a specific premium charge indicates that personal injury protection is afforded. [Emphasis added]

Since the motorcycle was not described or listed on the policy, and no specific premium was charged to insure its operators, coverage is excluded under the policy. However, Holyfield argues that this exclusion is contrary to Article 5.06-3(a) of the Texas Insurance Code, which prohibits delivery of automobile insurance policies which do not include PIP coverage. He urges that the exclusion in his policy cannot be given effect, foreto do so would restrict the breadth of coverage mandated by the Code. At least one Texas court of civil appeals has agreed with this argument. See Western Alliance Insurance Company v. Dennis, 529 S.W.2d 838, 840 (Tex.Civ.App.-Texarkana 1975, no writ).

In Western Alliance, the Texarkana court reasoned that since our supreme court had decided that an exclusion relating to uninsured motorist protection was an unlawful restriction of the coverage provided by statute, a similar result should be reached regarding PIP coverage. The supreme court case was Westchester Fire Ins. Co. v. Tucker, 512 S.W.2d 679, 686 (Tex.1974), in which the court, on rehearing, said:

As stated in our original opinion, we have concluded that the policy exclusion of injuries sustained by an insured while occupying an owned but unscheduled vehicle is ineffectual to the extent that it deprives a person of coverage required by Article 5.06-1 of the Insurance Code. [Emphasis added]

The problem with this statement is that, despite the court’s reference, no such conclusion was reached in the original opinion. In Westchester, the insured claimed benefits under the uninsured motorist insurance coverage for injuries sustained in an owned and scheduled vehicle. The court did not mention owned and unscheduled vehicles in its original opinion, and since the question was not presented, we disagree with the Texarkana court’s conclusion that West-chester is authoritative on this point.

Neither can we agree with the Texarkana court’s holding that providing coverage only for scheduled vehicles is a denial of coverage provided by Article 5.06-3(a) of the Insurance Code. While we agree that Article 5.06-3 dictates the type of coverage which must be provided, it does not, by its terms, dictate which vehicles the policy must cover or prevent the insurer and insured from agreeing that only certain vehicles will be covered. An insurer is entitled to accurately reflect in the policy the risks being insured and to charge premiums based upon those risks. See Vaughn v. Atlantic Insurance Company, 397 S.W.2d 874 (Tex.Civ.App.—Tyler 1966, writ ref’d n. r. e.) quoting Lumbermens Mutual Casualty Co. v. Pulsifer, 41 F.Supp. 249 (D.C.Me.1941) (purpose of policy exclusion of nonscheduled vehicles is to allow premiums to be based upon known risks, thereby protecting insurer from increased liability occasioned by risks of which it might not be aware). This right would be frustrated if, as Holyfield argues, an insured who owns more than one vehicle could insure and pay premiums based solely on the risk attendant to that vehicle, and thereby render the insurer liable for injuries sustained in or because of other vehicles owned by him. We cannot presume that such a result was intended. A more reasonable reading of Article 5.06-3 is that it merely requires that PIP benefits be provided; the manner in which benefits are provided is left to agreement between the parties. Accordingly, we hold that the exclusion in this case is valid, and that the trial court properly denied recovery under the policy.

Affirmed.

      . Uninsured motorist protection is mandated by Article 5.06-1 of the Texas Insurance Code.


author: KEITH, Justice.

text:
    SOUTHWESTERN ENGINEERING COMPANY et al., Appellants, v. PHILLIPS PIPE LINE COMPANY et al., Appellees.
    No. 8097.
    Court of Civil Appeals of Texas, Beaumont.
    April 6, 1978.
    Rehearing Denied April 27, 1978.
    C. L. Snow, Jr., R. C. Patterson, San Antonio, Max H. Jennings, Houston, for appellants.
    R. E. Kelly, Jr., E. H. Brown, Houston, James B. Langham, San Antonio, amicus curiae.
   KEITH, Justice.

The appeal is from a summary judgment overruling cross-defendants’ plea of privilege. Since we have a confused record, a lengthy statement is necessary in order to place the appeal in proper perspective.

Sandige Construction Company, Inc. (“Sandige”) contracted with Fort Bend Telephone Company (“Ft. Bend”) to lay a telephone line and its attendant facilities in an underground trench along certain public roads and privately owned lands in Waller County, Texas. Ft. Bend engaged Southwestern Engineering Company (“Southwestern”) to stake and locate the trench line upon the ground so that Sandige could perform its contract with Ft. Bend.

Southwestern did stake the line for the trench and Sandige was digging the trench on April 3,1974, when its bulldozer struck a buried high-pressure gas pipeline owned by Phillips Pipe Line Company (“Phillips”). The escaping gas ignited and the bulldozer and certain other equipment of Sandige were destroyed or seriously damaged.

Sandige filed suit in Waller County on March 25, 1976, seeking its property damages and named Phillips and Southwestern and three individuals as defendants alleging that its damages were proximately caused by the joint and several negligence of the defendants. Southwestern and the individual defendants filed their pleas of privilege to be sued in Kendall County, and an answer subject thereto. Phillips filed its answer alleging that Sandige was negligent in certain particulars. With leave of the court, Phillips also filed a counterclaim against Sandige and cross actions- against Ft. Bend and Southwestern seeking its damages and also filed an action over against Southwestern seeking indemnity or contribution in the event Sandige prevailed in its action against Phillips.

Southwestern filed its plea of privilege to be sued in Kendall County and Phillips filed its controverting affidavit contending, first, that Tex.Rev.Civ.Stat.Ann. art. 2212a, §§ 2(g) and (h) (Supp.1978), is a statutory determination of venue in that its cross action against Southwestern seeking contribution is proper as both parties are defendants in the “primary suit” filed by Sandige in Waller County.

Alternatively, Phillips invoked subdivisions 9a, 23, and 29a of Tex.Rev.Civ.Stat.Ann. art. 1995 (1964). No hearing was held upon the controverting plea; instead, Phillips filed its motion for summary judgment alleging that venue was controlled by Art. 2212a and included several citations to cases which we will discuss later. The court granted the motion for summary judgment and overruled Southwestern’s plea of privilege. We quote some of the findings of the court incorporated in the judgment.

We have been favored with excellent briefs by the parties as well as one by an amicus curiae but we do not reach the result sought by any interested party. We reverse the judgment of the trial court and remand the cause with instructions for the reasons now to be stated.

Three reported cases have held that Art. 2212a, §§ 2(g) and (h) is a statute such as mentioned in subdivision 30, Art. 1995. In the first, Goodyear Tire & Rubber Company v. Edwards, 512 S.W.2d 748, 753 (Tex.Civ.App.—Tyler 1974, no writ), the court held that “the legislature expressly provided a special venue in all cases where one of the named defendants files a cross claim against another named defendant for contribution. . . . Venue is therefore lodged in the county where the court hearing the primary suit is situated.”

In LaSorsa v. Burr, 516 S.W.2d 265, 270 (Tex.Civ.App.—Houston [14th Dist.] 1974, no writ), the court reached the same result, saying:

“This statute [Art. 2212a] provides special venue in all cases where one named defendant files a cross-claim against another party who is also a named defendant in the primary cause of action. This statute was drafted in mandatory language and provides that the venue of the cross-action is properly in the county where the court hearing the primary suit resides.”

A similar result was reached in Winningham v. Connor, 552 S.W.2d 579, 583 (Tex.Civ.App.-Tyler 1977, no writ), where the court, this time speaking through Chief Justice Dunagan, held:

“Having held that proper venue of the claim for contribution is in the primary suit, it is our opinion that the claim for indemnity is likewise to be determined in the same suit.”

Phillips urges this triad of cases, along with the Middlebrook Doctrine, as supporting the action of the trial court in granting the summary judgment. We accept the law enunciated in the three cases mentioned (Edwards, Winningham, and LaSorsa, supra), but do not reach the conclusion postulated by Phillips.

Under the record which we review, the primary suit is in judicial limbo. We are of the opinion that the venue of the primary suit (Sandige v. Phillips Southwestern, et al) must control the venue of the action for indemnity and contribution under the new statute (Art. 2212a), and until such determination has been made, a determination of venue of the indemnity action is premature. Sandige alleged that the several defendants sued (Phillips, Southwestern, et a1) were jointly and severally liable for its damages.

Thus, if Southwestern’s plea of privilege in the Sandige “primary” action were to be sustained, the entire suit might be transferred to the domicile of Southwestern under the rationale of Johnson v. First National Bank of Brenham, 42 S.W.2d 870, 871 (Tex.Civ.App.-Waco 1931, no writ), quoted with approval in International Harvester Company v. Stedman, 159 Tex. 593, 324 S.W.2d 543, 545 (1959). See also Echols v. Brewer, 524 S.W.2d 731, 735 (Tex.Civ.App.-Houston [14th Dist.] 1975, no writ), following Stedman, supra.

The theory urged upon us by counsel for Phillips would have venue of the indemnity action control venue for the primary suit. We are of the opinion that this is to put the cart before the horse and we reject the contention. At most, Phillips has a cause of action against Southwestern only if San-dige should recover a judgment against it in the primary suit. We do not permit this possible future event to control venue of the primary suit.

The trial court never got around to a determination of Phillips’ controverting plea of privilege wherein it relied upon several venue exceptions found in Art. 1995. It did not hear any evidence nor did it make any factual determination of the rights of the parties under the general venue statute. Instead, from an examination of the pleadings, it granted a summary judgment sustaining Phillips’ special plea in bar as to the venue question. We are of the opinion that this constituted error. See Texas Highway Department v. Jarrell, 418 S.W.2d 486, 489 (Tex.1967), wherein the Court held:

“Venue cannot be put in issue by pleas to the jurisdiction, pleas in bar, or pleas in abatement, but only by a plea or privilege.”

Similarly, in order to maintain venue as against a plea of privilege regular upon its face and timely filed, a plaintiff (and that is the position Phillips occupies in this cause) must plead and prove that his cause is within one or more of the exceptions set out in the general venue statute. Banks v. Collins, 152 Tex. 265, 257 S.W.2d 97, 99 (1953); Guerra v. Texas Employers Insurance Ass’n, 480 S.W.2d 769, 772 (Tex.Civ.App.-Corpus Christi 1972, no writ). There has been no such hearing and no such proof has been adduced.

The venue in the primary suit has not been determined, and, in view of the delay incident to the disposition of the Sandige controverting plea of privilege, may never be tried. We are unwilling, upon this record, to affirm a judgment fixing the venue of the cross action for contribution prior to a determination of the jurisdiction of the primary action. Accordingly, we are of the opinion that the trial court erred in granting the motion for summary judgment and sustain the third point of error in Southwestern’s brief.

The judgment of the trial court is reversed and the cause is remanded with instructions to withhold action upon the controverting plea of Phillips until venue of the primary suit between Sandige and Southwestern, et al, has been determined. The trial court should then enter an order fixing venue as to Phillips’ action for indemnity and contribution in the county having venue of the primary suit.

REVERSED and REMANDED with instructions.

      . Although Sandige controverted the pleas of privilege filed by Southwestern and the individual defendants, the venue of the “primary” suit between Sandige and Southwestern, et al, has not been determined.

      . “[T]he Court is of the opinion that the records show an absence of any genuine issue of a material fact since venue of Phillips Pipe’s cross action for contribution against Southwestern is proper as a matter of law in Waller County, Texas, where the primary suit is pending, under Tex.Rev.Civ.Stat.Ann. art. 2212a; and since venue is proper as to the contribution claim in Waller County, Texas, the venue as to Phillips Pipe’s other good faith joinable claims plead against Southwestern is proper as a matter of law in Waller County, Texas, in order to avoid a multiplicity of lawsuits.” (emphasis supplied)

      .The same attorney also appeared as amicus in Winningham v. Connor, 552 S.W.2d 579 (Tex.Civ.App.—Tyler 1977, no writ), to be discussed later in this opinion.

      . The doctrine derives its name from the case of Middlebrook v. David Bradley Mfg. Co., 86 Tex. 706, 26 S.W. 935 (1894), based upon the public policy of avoiding a multiplicity of suits.

      . Our problem is further complicated because Phillips invoked the jurisdiction of the United States District Court in Houston seeking to recover its damages and named all of the parties (except the individual defendants) as defendants before Sandige filed its state court suit. Counsel has advised us on oral argument that the federal court action is also in judicial limbo since the judge refuses to take any action thereon pending the outcome of the state court proceedings.


author: CLAYTON, Justice.

text:
    CITY OF HOUSTON, Appellant, v. Magdelean BUSH et al., Appellees.
    No. 8088.
    Court of Civil Appeals of Texas, Beaumont.
    April 6, 1978.
    Rehearing Denied May 18, 1978.

      Joseph G. Rollins, Roy F. Martin, III, Houston, for appellant.
    Rod Steinburg, Michael Y. Saunders, Houston, for appellees.
   CLAYTON, Justice.

This is a wrongful death action. The widow and minor son brought this suit against the City of Houston for the wrongful death of Jimmie Lee Bush. Trial was to a jury. The jury found that the death of Jimmie Lee Bush was proximately caused by the negligence of a city employee, while he was acting in the course and scope of his employment for appellant, the City of Houston, and absolved deceased from any negligence. The jury awarded damages in the total amount of $288,500, $250,000 of which was awarded to deceased’s widow and $38,500 to her minor son. Judgment was accordingly entered on the verdict, from which judgment this appeal has been perfected.

This case arises out of the cave-in of a ditch at the appellant’s “Edloe Project” in Houston. Jimmie Lee Bush, an employee of John Ellington, Inc., was killed in the cave-in.

Appellant’s first point complains of the trial court’s failure to grant its “motion for instructed verdict and for judgment non obstante veredicto . . . because the defendant [appellant] is governmentally immune from liability under the facts of the case.” Appellant urges it is immune to liability for negligence in the performance of governmental functions (except as may be otherwise provided in the Texas Tort Claims Act), City of Texarkana v. Taylor, 490 S.W.2d 191, 192 (Tex.Civ.App.-Texarkana 1972, writ ref’d n. r. e.), and that the construction and operation of sanitary sewers is the exercise of the city’s governmental function, Dilley v. City of Houston, 148 Tex. 191, 222 S.W.2d 992 (1949); Chambers v. City of Dayton, 447 S.W.2d 425, 426 (Tex.Civ.App.-Beaumont 1969, writ ref’d n. r. e.). Appellant contends that because the deceased, as an employee of one of the contractors on a city project, was laying sanitary sewer pipe at the time and place of the ditch cave-in, the appellees are barred, as a matter of law, from any recovery by governmental immunity. Appellant argues in the alternative under its Point No. 7 that if the city’s immunity has been waived by the Texas Tort Claims Act, appellee’s recovery is limited to $138,500.

The Texas Tort Claims Act does not apply to injury or death proximately caused by the city or its employees engaged in nongovernmental (proprietary) functions. Tex.Rev.Civ.Stat.Ann. art. 6252-19 § 18(a) (1970). If the provisions of the Texas Tort Claims Act do not apply when the city acts in its proprietary capacity, as opposed to its governmental capacity, the limitations on the amount of recovery set forth in Section 3 of the Act would not apply.

The evidence shows that deceased’s employer, John Ellington, Inc., did all the underground work except the lift station and structural work for appellant on the “Edloe Project” which was a project in and for the benefit of the City of Houston. Up until the time of this cave-in the Ellington crew had been relocating water lines and storm sewer lines as well as sanitary sewer lines.

The city inspector testified that this was all one City of Houston project; the city had more to do on this project than construct and relocate sanitary sewer lines; that as a necessary part of this project, the city needed to relocate water lines and put in storm sewers. The Ellington crew worked on both sewer and water lines and moved all of the water lines. On the day of this cave-in there is evidence to the effect that this inspector inspected and reported on a storm sewer lift station which was being actively constructed on this project. He further testified that on this project the city had built a storm sewer lift station, and it was possible that he was working on the storm sewer lift station on the day of the cave-in. The city inspector involved herein was the overseer of the work of several contractors who were working at the same time on the “Edloe Project.”

The above facts clearly show the necessary interrelationship of the various functions being performed on this integrated city project. The project would not serve the function intended without completion of all its working parts or phases. Moreover, a reasonable inference can be drawn from the above evidence that the sanitary sewer line on this project was in furtherance, at least in part, of the storm sewers being constructed. We find no evidence in the record to the contrary.

It has been held when a city is engaged exclusively in the construction of a sanitary sewer system, that it is engaged in a “governmental function.” Chambers v. City of Dayton, supra at 426; City of Texarkana v. Taylor, supra at 192. On the other hand, construction of a storm sewer by the city has been labeled a proprietary function. City of Amarillo v. Ware, 120 Tex. 456, 40 S.W.2d 57, 60 (Tex.Com.App.1931, opinion adopted); Dilley v. City of Houston, supra at 993; Pontarelli Trust v. City of McAllen, 465 S.W.2d 804, 808 (Tex.Civ.App.—Corpus Christi 1971, no writ). Similarly, when a city is engaged in construction designed to furnish water to city residents, that func-. tion is labeled proprietary. Boiles v. City of Abilene, 276 S.W.2d 922, 924 (Tex.Civ.App.-Eastland 1955, writ ref’d); City of Waco v. Busby, 396 S.W.2d 469, 471 (Tex.Civ.App.-Waco 1965, writ ref’d n. r. e.).

It appears from the evidence the functions being performed by the city in the construction project were in part governmental and in part proprietary. We hold that if some aspect of the function being performed by the city is governmental and some aspect of the function is proprietary, the city will not be entitled to governmental immunity. See City of Austin v. Daniels, 322 S.W.2d 384 (Tex.Civ.App.-Austin 1959), aff’d, 160 Tex. 628, 335 S.W.2d 753 (1960); City of Port Arthur v. Wallace, 141 Tex. 201, 171 S.W.2d 480 (1943). We further hold that a municipality’s plea of “governmental immunity” is a defensive doctrine, placing on the city the burden of proving and submitting the defense. See City of Houston v. Edman, 498 S.W.2d 464, 466 (Tex.Civ.App.-Houston [1st Dist.] 1973, no writ). The burden is upon the city to show that the relevant function on which it bases its defense was exclusively a governmental function. City of Beaumont v. Silas, 200 S.W.2d 690 (Tex.Civ.App.-Beaumont 1947, writ ref’d n. r. e.). There was conflicting testimony on the type of line which had been installed for the city shortly before the cave-in. A co-worker with deceased testified that the crew had installed a water pipe in the ditch that caved-in. There was other testimony that a sanitary sewer pipe had been placed in the ditch. Because of this conflict in the testimony it was incumbent upon the city to obtain a finding from the jury as to the type of work actually being performed, i. e., laying the sewer line or water line, to determine if the function was governmental or proprietary. The city did not request any issues concerning this defense. It is incumbent upon a party to submit substantially correct issues which raise each element of a ground of defense. Grubb v. Grubb, 525 S.W.2d 38, 42 (Tex.Civ.App.-El Paso 1975, writ ref’d n. r. e.); National Life And Accident Ins. Co. v. Salas, 426 S.W.2d 327, 330 (Tex.Civ.App.-Eastland 1968, writ ref’d n. r. e.); Tex.R.Civ.P. 279.

There being a question of fact raised as to this element of defense and an issue with reference thereto not being submitted to the jury, in the absence of objection and failure to request such issue, appellant has waived the same. Glens Falls Insurance Co. v. Peters, 386 S.W.2d 529, 531 (Tex.1965); Tex.R.Civ.P. 279. Appellant’s Points Nos. 1 and 7 are overruled.

Appellant urges in its second and third points error by the trial court in entering judgment for the plaintiffs because “the defendant owed no duty to Jimmie Lee Bush as a matter of Law” and “because the conditions of the premises were open and obvious as a matter of law.” Appellant argues the only duty owed to deceased was to warn him of the dangerous conditions of the premises and that such duty was discharged because deceased knew of such dangerous conditions; and because of such knowledge, appellant is absolved from liability by the “no-duty” doctrine as stated in Delhi-Taylor Oil Corp. v. Henry, 416 S.W.2d 390, 392 (Tex.1967).

Our Supreme Court in Parker v. Highland Park, Inc., 565 S.W.2d 512 (1978), expressly abolishes the so-called “no-duty” concept in this type of case and holds that in all cases heretofore involving the “no-duty” rule are now to be tried under general rules of negligence. The Supreme Court states:

“A plaintiff’s knowledge, whether it is derived from a warning or from the facts, even if the facts display the danger openly and obviously, is a matter that bears upon his own negligence; it should not affect the defendant’s duty. ... A condition that is open and obvious is proof of knowledge and appreciation as a matter of law, Massman-Johnson v. Gundolf, 484 S.W.2d 555 (Tex.1972), but that phrase is not ‘a separate concept.’ Knowledge and appreciation, though proved as a matter of law, do not necessarily establish contributory negligence as a matter of law.” Id. at 521.

These points are overruled.

Appellant’s fourth point complains of the trial court’s entering judgment for the plaintiffs because there is no evidence to support the jury’s answer to Special Issue No. la. This issue refers to the jury’s affirmative finding that the city inspector, acting in the course and scope of his employment for the city, was negligent and such negligence was a proximate cause of the accident. Appellant does not point out specifically the particular element complained of in such issue. However, its entire argument under this point is the same as urged under its second point, wherein it argues the city owed no duty to deceased. This point is overruled for the same reasons for overruling its second and third points.

Appellant’s fifth and sixth points complain that “the trial court erred in entering judgment for the plaintiffs because the jury’s answer to Special Issue No. lb was against the great weight and preponderance of the evidence” and that the deceased “was negligent as a matter of law.” This Issue No. lb inquired of the negligence and proximate cause as to the deceased, the jury having answered the issue favorably to deceased in finding him not to be negligent. A challenge based on factual “insufficient evidence” requires consideration and weighing of all evidence in the case to determine whether evidence supporting the jury finding is so weak or evidence to the contrary so overwhelming that the findings should be set aside and a new trial decreed. In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660, 661 (1951).

The Ellington crew had been working on this particular project for the city for six to eight months and laying this line for approximately one week before the accident. Prior to the cave-in, the pipe had been laid and the sand leveled. The shoring had been pulled from the ditch prior to the accident and backfilling had begun. At the time of the accident, appellant had an inspector on this job overseeing the work. One of the concerns of this inspector was that the pipe, which had been laid in the ditch, had at least twelve inches of sand on top of it. The safest procedure for checking the grade, was with a grade pole, since this procedure did not require that the person who was cheeking the grade to go into the ditch. The inspector, however, ordered the deceased to check the depth of the sand with a short stick which required deceased to go down into the ditch. The deceased willingly followed this order as he had followed other orders of the inspector. He watched deceased use the stick. Although the shoring had been removed from the ditch, the ditch looked “real hard . solid . . . safe, solid.” The inspector indicated that the soil was “deceptive” in appearance, inasmuch as it looked solid or sturdy, but “actually it was very dangerous.” From the time the inspector handed the stick to deceased, only one to one-and-a-half minutes “at the very most” passed until the fatal cave-in. The evidence in the record is factually sufficient to support the jury’s finding of “no negligence” on the part of deceased, and fails to show deceased to be negligent as a matter of law. These points are overruled.

The judgment of the trial court is affirmed.

AFFIRMED.

      . Tex.Rev.Civ.Stat.Ann. art. 6252-19 (1970), as amended (Supp. 1978).


text:
    E-TEX DAIRY QUEEN, INC., Appellant, v. Robert Wade ADAIR, Appellee.
    No. 8109.
    Court of Civil Appeals of Texas, Beaumont.
    April 6, 1978.
    Rehearing Denied April 27, 1978.

      Joe E. Griffith, Crockett, for appellant.
    John V. Elick, Bellville, for appellee.
   KEITH, Justice.

Defendant below appeals from an adverse judgment rendered in a jury trial on a suit for wrongful discharge from employment.

Plaintiff was an employee of defendant from November 1973 until July 1975. While working in one of defendant’s stores in June 1975, he sustained a hernia requiring hospitalization and was discharged by defendant on July 21, 1975, subsequent to which he filed a claim for worker’s compensation benefits.

In November 1975, plaintiff was employed again by defendant’s district manager but was fired, again and finally, on his first day on the job.

Plaintiff filed this suit under Tex.Rev. Civ.Stat.Ann. art. 8307c (Supp.1978), claiming that he had been wrongfully discharged from his employment on July 21, 1975, and November 25, 1975, because he had filed a worker’s compensation claim.

The jury found that he had been wrongfully discharged on November 25, 1975, because of his claim for compensation benefits, but not on July 21, 1975. The jury further found that as a result of this wrongful discharge plaintiff should be awarded $5,548.00 for loss of past earnings. The trial court entered a judgment accordingly, and the appeal is taken from this judgment.

In its points of error one and two, defendant contends that the trial court erred in submitting to the jury Special Issue No. 2 and in entering judgment upon the jury’s answer to that special issue because plaintiff admitted that the employer who discharged him on November 25,1975, was not our defendant, but E-Tex Dairy Queen Company, a different company which is not a party to the case at bar. We disagree.

Tex.R.Civ. P. 93(e) (Supp.1978) requires that any pleading claiming a defect of parties must be verified by affidavit, “unless the truth of such matters appear of record.”

Defendant failed to file a verified pleading denying that it was the entity which fired plaintiff on November 25, 1975. Therefore, it waived its right to do so “unless the truth of such matters appear of record.” See and compare Campbell v. Jefferson, 453 S.W.2d 336, 340 (Tex.Civ.App.-Tyler 1970, writ dism’d), and authorities therein cited.

Defendant contends that plaintiff by his own admissions in his depositions and in court has proved that he sued the wrong entity with regards to his second firing.

A judicial admission is a formal waiver of proof that relieves an opposing party from making proof of an admitted fact and bars the party who made the admission from disputing it. Gevinson v. Manhattan Construction Co. of Okla., 449 S.W.2d 458, 466 (Tex.1969); Esteve Cotton Co. v. Hancock, 539 S.W.2d 145, 157 (Tex.Civ.App.—Amarillo 1976, writ ref’d n.r.e.). The testimonial declarations of a party may constitute a judicial admission, but they must be clear, deliberate, and unequivocal. Gevinson, supra, 449 S.W.2d at 466; Griffin v. Superior Insurance Co., 161 Tex. 195, 338 S.W.2d 415, 419 (1960); United States Fidelity & Guaranty Co. v. Carr, 242 S.W.2d 224, 229 (Tex.Civ.App.-San Antonio 1951, writ ref’d). This doctrine is applied with caution because its application could result in the destruction of a party’s right of recovery or defense. Esteve Cotton, supra, 539 S.W.2d at 157.

A review of plaintiff’s testimony shows only that plaintiff knew that there had been a change in the ownership and management of “E-Tex Dairy Queen” — instead of two partners managing twenty-four stores, each person owned and managed twelve stores, with Henry Ellis retaining the ownership of “E-Tex Dairy Queen.” His statements are not so clear, deliberate, and unequivocal as to constitute a conclusive judicial admission that plaintiff knew E-Tex Dairy Queen Company fired him on November 25, 1975, rather than E-Tex Dairy Queen, Inc.

E-Tex Dairy Queen, Inc., is still a viable corporation with Henry Ellis as its president; Ellis is also the managing partner of E-Tex Dairy Queen Company. This is the same Henry Ellis who, upon receiving the citation in this suit (accompanied by plaintiff’s original petition giving him full notice of plaintiff’s contentions), took no action to inform the court that it was his partnership — and not his corporation which should have been sued. Moreover, instead of advising plaintiff of the ownership question by pleading or by answers to interrogatories, defendant waited until trial to raise the question.

From our review of the evidence we are not convinced that plaintiff’s knowledge of the management change, in and of itself and without a more complete and detailed understanding of the nature of the change, relieved defendant of its duty of affirmatively pleading a defect in the parties sued. Points one and two are overruled.

In its third point of error, defendant attacks the legal and factual sufficiency of the evidence supporting the submission of and the jury’s answer to Special Issue No. 2.

In considering a “no evidence” point, we must view the evidence in its most favorable light in support of the finding and we must review only the evidence and inferences which support the finding. Lucas v. Hartford Accident and Indemnity Co., 552 S.W.2d 796, 797 (Tex.1977); Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965). In considering an “insufficient evidence” point, we must consider all the evidence. Garza, supra, at 823; In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660, 661 (1951).

We now recount a portion of the evidence pertaining to Special Issue No. 2 noting that general manager Ingram and district supervisor Milam were eager to hire plaintiff in order to improve their employer’s business because he maintained low food and labor costs. Defendant’s president Ellis and secretary-treasurer Lankford wanted him discharged immediately. Both Ingram and Milam gave as one of the reasons for discharging plaintiff his filing of the claim for compensation benefits. In fairness to defendant, we concede that they also testified that plaintiff was discharged because of his past record of misconduct, especially his social contacts with female employees.

Having reviewed the evidence under the appropriate standards, we are of the opinion that the evidence was factually sufficient to authorize the submission of Special Issue No. 2 and to support a finding in favor of plaintiff.

The jury as a trier of fact was in the best position to evaluate the testimony. It is clear that it concluded that defendant wrongfully discharged plaintiff because of his compensation claim. The jury had the right to believe plaintiff and the right to disbelieve defendant’s witnesses. Point three is overruled.

In its point of error four, defendant attacks the legal and factual sufficiency of the evidence supporting the submission and the jury’s answer to Special Issue No. 3(1) inquiring into plaintiff’s loss of earnings in the past.

Plaintiff quit a job as a Dairy Queen store manager in Killeen, Texas, to work for defendant. Ingram testified as to the salary and commissions a store manager could reasonably expect to earn — $1,450.00 to $1,650.00 per month — and the average length of tenure of most employees — three years. Plaintiff testified as to the various jobs that he had since he was fired, some of the salaries that he received, and various attempts that he made in obtaining other employment.

Viewing the evidence in the appropriate manner, we find that the evidence was factually sufficient to support the finding that plaintiff had sustained a loss of past earnings of at least the amount awarded by the jury. No error is shown in point four.

Having found no reversible error, we affirm the judgment of the trial court.

AFFIRMED.

      . SPECIAL ISSUE NO. 2: “Do you find from a preponderance of the evidence that the defendant discriminated against Bob Adair, or discharged Bob Adair from his job on or about November 25, 1975 as a result of Bob Adair claiming workmen’s compensation benefits?”
      “Answer: We do.”

      . When plaintiff was asked why he had testified about working for two different employers, he explained:
      “A Okay. Number one was that they said on that different employer that at the time the other company was in progress, you know, that E-Tex was, you know, both partners in there, Henry never had anything to do with the company, but after they, Henry and them, split up, Henry took half of the companies, that meant he was in charge of his twelve, and Ray was in charge of his twelve, meaning that Ray was not still the same man in charge of the whole company like it used to be, but I assumed it was the same people in there but only different was Ray was not there, and that’s how I meant that the, you know, the two companies was different ever since—
      ******
      “A I was just going to say that, you know, as far as the company being the same, nothing’s changed, the address is the same.”


text:
    NEEDVILLE INDEPENDENT SCHOOL DISTRICT, Appellants, v. S. P. J. S. T. REST HOME, Appellee.
    No. 8094.
    Court of Civil Appeals of Texas, Beaumont.
    April 6, 1978.

      George J. Prappas, Houston, for appellants.
    Ted W. Hejl, Taylor, Don T. Schwartz, Rosenberg, for appellee.
   KEITH, Justice.

Plaintiffs below appeal from a take nothing judgment entered after a jury trial. Needville Independent School District brought suit for delinquent taxes and City of Needville intervened seeking delinquent ad valorem taxes owed to it. The defendant answered by claiming that it was exempt from ad valorem taxation as an institution of purely public charity within the meaning of Tex.Const. art. VIII, § 2, and Tex.Rev.Civ.Stat.Ann. art. 7150, § 7 (Supp. 1978).

The Court instructed the jury that an institution is a purely public charity if it met each of these tests:

“First, it makes no gain or profit; Second, it accomplishes ends wholly benevolent; Third, it benefits persons, indefinite in numbers and in personalities, by preventing them, through absolute gratuity, from becoming burdens to society and to the State . . .

The jury was further instructed:

“An institution that meets all of the above three (3) tests may be one of purely public charity that dispenses absolute gratuities even though it requires those who can pay [to] do so and makes supplemental payments to those who cannot pay all their costs.”
“ ‘Gain or profit’ . . . means gain or profit by private individuals, or the accrual of profits distributable as dividends. It does not include profits used for activities directed at sustaining and furthering benevolent activities.”

The jury found that defendant was a purely public charity under the instructions, and judgment was entered for defendant that plaintiff and intervenor take nothing. Seven days after the entry of judgment, plaintiff and intervenor filed a motion for judgment non obstante veredicto and defendant now contends that we are not authorized to consider points of error based upon this motion. The contention is without merit and is overruled.

A motion for judgment non obstante veredicto may be filed after a judgment has been entered but before it becomes final. Hann v. Life & Casualty Insurance Co. of Tennessee, 312 S.W.2d 261, 263 (Tex.Civ.App.—San Antonio 1958, no writ); Walker v. S & T Truck Lines, Inc., 409 S.W.2d 942, 943 (Tex.Civ.App.—Corpus Christi 1966, writ ref’d). See also 4 McDonald, Texas Civil Practice § 17.32, at 210-11 (Rev.Vol.1971).

The Hann Court explained the rationale of the holding:

“The rules do not provide for a time limit on the filing and passing upon of a motion non obstante veredicto, therefore, such motion may be filed even after the court has rendered judgment on the verdict, and may be acted upon any time before the motion or amended motion for a new trial has been overruled, either by the court or by operation of law.” (312 S.W.2d at 263)

The three points of error brought forward are all based upon the action of the trial court in overruling their motion for judgment non obstante veredicto and are, consequently, “no evidence” points. R. Calvert, “ ‘No Evidence’ and ‘Insufficient Evidence’ Points of Error,” 38 Texas L.Rev. 361, 362 (1960). Consequently, we must review the evidence in the most favorable light in support of the jury’s finding and disregard all evidence to the contrary. Lucas v. Hartford Accident & Indemnity Co., 552 S.W.2d 796, 797 (Tex.1977); Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965); Fisher Construction Co. v. Riggs, 160 Tex. 23, 325 S.W.2d 126, 127 (1959).

It is first contended that defendant failed to prove that it makes no gain or profit from its operations. It is apparent from a review of the record that while defendant did in fact make profits during some years of its existence, all such profits were used for capital improvements or mortgage payments. There is no capital stock and no dividends have ever been declared or paid.

In City of McAllen v. Evangelical Lutheran Good Samaritan Society, 530 S.W.2d 806, 809 (Tex.1975), or Supreme Court answered the contention now before us in this language:

“[T]he fact that the net result of [an organization’s] endeavors was the acquisition of profit, would not subject the organization to taxation because the profits were used for the permissible purposes of maintaining or expanding [its] operations.” (530 S.W.2d at 809)

See also G. Hartt, III, “Ad Valorem Taxes and Non-Profit Health-Care Facilities,” 39 Tex.B.J. 865 (1976), and authorities therein cited.

Point one is overruled.

Plaintiffs next contend that defendant failed to prove that it assumes, to a material extent, costs which otherwise might become an obligation of the community or state — one of the conditions laid down in McAllen, supra, 530 S.W.2d at 810. Again, we disagree and overrule such point.

It is shown by our record with clarity and without dispute: (a) defendant accepts applicants without regard to their financial conditions; (b) those who can afford to pay are required to pay for the services rendered; (c) while some payments are made by the State Welfare Department on behalf of some indigents, defendant has a special charitable fund from which it subsidizes the payments of those who cannot afford to pay the complete costs.

The McAllen Court noted that our traditional view of charities has changed:

“With the advent of present day social security and welfare programs, the traditional concept of charity, involving the extension of free services to the poor and alms-giving, will be rarely found since wide ranging assistance is available to the poor under such programs. Furthermore, the courts have defined charity to be something more than mere alms-giving or the relief of poverty and distress. The ultimate consideration then, should be based upon an evaluation of the total operation of the institution engaged in humanitarian activities . ..” (530 S.W.2d at 810)

Having tested the record under the applicable rules [see, e. g., Garza v. Alviar, supra, 395 S.W.2d at 823], we find no merit to the contention so advanced.

Our attention has been called to the recent opinion in Air Force Village Foundation, Inc. v. Northside Independent School District, 561 S.W.2d 905 (Tex.Civ.App.—El Paso, 1978, writ pending). This excellent opinion, with which we are in complete accord, is readily distinguishable on the facts. There, the jury refused to find that the Foundation was a “purely public charity” and the attack upon this “non-finding” was rejected by the El Paso Court. Here, upon competent evidence, the jury answered a comparable issue in the affirmative and the plaintiffs’ “no evidence” points have been considered and rejected by this court.

Finally, it is contended that there was no evidence to support defendant’s burden of showing that it “accomplishes ends wholly benevolent,” a term which has never been interpreted in the context of a charitable entity claiming exemption from ad valorem taxation.

However, in State v. Texas Mutual Life Ins. Co., 51 S.W.2d 405, 410 (Tex.Civ.App.—Austin 1932), reversed on other grounds, 58 S.W.2d 37 (Tex.Comm’n App.1933, jdgmt adopted), the court spoke of the word “benevolent,” saying:

“It [the word benevolent] is a broader term than ‘charity,’ which it includes .. Charity in its legal sense implies giving without consideration or expectation of return. Whereas benevolent is applied to any act which is prompted by or has for its object the well being of others.”

We find this concept to be compatible with the rationale and the holding of our Supreme Court in McAllen, supra, and will use it as our guideline in passing upon the point now under review.

Defendant’s charter provides as follows:

“The purposes for which this corporation is created shall be to provide assistance, charity and relief for aged persons of both sexes by acquisition of land for the construction of appropriate buildings, and by providing the necessary funds for the complete operation . . . of . such home for the aged; and to provide personal and custodial care, incident to old age and infirmity, in such a manner as to give most comfort, sheltered care, privacy, emotional stability, and happiness to aged persons .

The evidence reveals that defendant is accomplishing its purpose — “ends wholly benevolent.” Therefore, plaintiffs’ third point of error is overruled.

There being some evidence in the record to support the jury’s finding of a purely public charity, we affirm the trial court’s judgment that defendant is exempt from ad valorem taxation.

AFFIRMED.


author: REYNOLDS, Justice.

text:
    William R. BEACH, Sr., Appellant, v. The AMERICAN NATIONAL BANK OF AMARILLO, Appellee.
    No. 8889.
    Court of Civil Appeals of Texas, Amarillo.
    April 10, 1978.
    Jay U. Kirkman, Amarillo, for appellant.
    Culton, Morgan, Britain & White, Pat Long, Amarillo, for appellee.
   REYNOLDS, Justice.

The American National Bank of Amarillo instituted this suit to recover from William R. Beach, Sr., the charges on his BankAm-ericard in the sum of $289.54 and reasonable attorney’s fees. Beach cross-actioned for $4,999 actual and exemplary damages alleged to have resulted from unreasonable collection efforts and for a reasonable attorney’s fee. A jury’s verdict is the basis of a judgment decreeing that the bank recover its claim of $289.54 together with $1,152 as reasonable attorney’s fees in this cause, and that Beach take nothing by his cross-action.

Beach has limited his appeal to the propriety of the award for attorney’s fees, particularly as it includes representation in the defense of the cross-action. Reversed and remanded.

As a matter of law, attorney’s fees are not recoverable in tort or contract actions unless provided for by statute or by contract between the parties. New Amsterdam Casualty Company v. Texas Industries, Inc., 414 S.W.2d 914, 915 (Tex.1967). The bank does not contend that its recovery for attorney’s fees is authorized by any statute; rather, the bank asserts entitlement to attorney’s fees under the BankAmericard agreement. That agreement is that Beach will pay to the bank “. . . all obligations representing credit extended hereunder . . . and a reasonable attorney fee as set by a court in the event of suit under this agreement.” (Emphasis supplied.)

As phrased, the agreement makes Beach liable for an attorney’s fee reasonably incurred in a court action to enforce his obligation to pay for credit extended. It does not otherwise impose any liability for an attorney’s fee.

Here, however, the award of $1,152 for the attorney’s fee stems from evidence that the attorney’s time was spent representing the bank in both the main action and the cross-action. Unallocated by the testimony to either action is evidence of a total of 18.8 hours spent at the pleaded $40 per hour, which computes to $752.

The subject matter of the main action is the debt owed the bank, an action for which Beach contractually obligated himself to pay a reasonable attorney’s fee; the subject matter of the cross-action is not the debt itself, but the manner of the bank’s attempted collection, the defense of which is not chargeable to Beach under the contract. Notwithstanding, the court asked the jury, over Beach’s objection, to fix the amount of “a reasonable attorneys’ fee for the work expended in this cause by the attorneys representing” the bank. The jury answered “$1152.00.”

The submission erroneously authorized the jury to, and obviously it did, consider the attorney’s work expended in defending the cross-action, which is unrelated to the contractual obligation for an attorney’s fee and for which Beach did not contractually incur an obligation. Beyond that, the jury’s answer is an amount greater than the evidence of the total fee for both actions.

Accordingly, the portion of the judgment awarding attorney’s fees is reversed, and that portion of the cause is remanded to the trial court.


author: DIES, Chief Justice.

text:
    Hurshel J. ERVIN, Appellant, v. GERBER LIFE INSURANCE COMPANY, Appellee.
    No. 8098.
    Court of Civil Appeals of Texas, Beaumont.
    April 13, 1978.
    Rehearing Denied May 4, 1978.
    Wayne Walker, Houston, for appellant.
    Robert A. Rowland, III, Houston, for ap-pellee.
   DIES, Chief Justice.

Plaintiff below, Hurshel J. Ervin, filed suit against Gerber Life Insurance Company, defendant below, on three policies of insurance. Each policy provided monthly payments during hospitalization. Plaintiff alleged that as a result of an automobile accident on December 28, 1973, he was hospitalized on three separate occasions, and that defendant failed to pay all it was obligated to pay under the policies. Plaintiff also sued for treble damages and attorney’s fees under the Texas Deceptive Trade Practices — Consumer Protection Act [Tex.Bus. & Comm. Code Ann. § 17.41 et seq. (Supp. 1978)].

Defendant answered that on May 1,1974, plaintiff for valuable consideration can-celled and returned the policies, discharging defendant from any further liability to plaintiff. Defendant also pled an agreement entered into with plaintiff dated May 1,1974, in which, for valuable consideration, plaintiff agreed he would not make any application to defendant for other policies of insurance.

On April 15, 1977, defendant filed a motion for summary judgment which was initially set for hearing on April 25, 1977, but was later cancelled. On May 18, 1977, a letter was delivered notifying counsel for plaintiff that hearing on defendant’s motion for summary judgment was set for hearing before the court on May 23, 1977.

On May 23, 1977, the court inquired of plaintiff’s counsel whether he had filed any papers in opposition to defendant’s motion for summary judgment. Counsel answered in the negative. The court advised counsel that his opposition evidence must be filed at least one day before the motion was heard. The court then reset the hearing until May 31, 1977.

On May 31, 1977, plaintiff’s counsel filed affidavits contending plaintiff had no mental capacity at the time of executing the releases referred to above. The court refused to consider these affidavits, and granted defendant’s motion for summary judgment.

Plaintiff first urges that the court erred in refusing to consider' his affidavits.

Tex.R.Civ.P. 166-A(c) at the time of the hearing, provided: “The adverse party prior to the day of hearing may serve opposing affidavits.”

Plaintiff contends this is directory, and not mandatory.

In General Plywood Corporation v. Collins, 414 S.W.2d 224, 228 (Tex.Civ.App.-Amarillo 1967, no writ), Judge Denton, writing for the court, said:

“Appellant’s remaining point of error goes to the alleged error of the trial court in not permitting appellant to file its opposing affidavit on the day the motion for summary judgment was heard. An opposing affidavit filed on the date of the hearing does not comply with the provisions of Rule 166-A(c). The refusal to permit the filing of such an instrument or to consider it was not error. Medina v. Sherrod (Tex.Civ.App.) 391 S.W.2d 66. These are matters within the discretion of the trial court and no abuse of that discretion is shown.”

See also, Lawyers Surety Corp. v. Investors Mutual of Nueces, Inc., 353 S.W.2d 882 (Tex.Civ.App.-San Antonio 1962, writ ref’d n. r. e.); Cantu v. Bage, 467 S.W.2d 680, 683 (Tex.Civ.App.-Beaumont 1971, no writ).

This point is overruled. Plaintiff insists defendant failed to discharge its burden of showing as a matter of law that plaintiffs had no cause of action against it, citing Stevens v. Bowie National Bank of Bowie, 475 S.W.2d 314, 318 (Tex.Civ.App.-Fort Worth 1971, writ ref’d n. r. e.).

The summary judgment evidence consisted of:

1. A release of policy K23083 for $1,450.00 signed by plaintiff and notarized.
2. A similar release for $1,450 of policy K23396.
3. A similar release of policy 53070 for $966.86.
4. A signed agreement by plaintiff, for consideration, that he would not in the future apply to defendant for a policy of insurance.
5. Copies of the checks set forth in 1, 2, 3 above showing plaintiff’s endorsement.
6. Affidavit of Gary W. Kimball who negotiated the compromise claim settlements.

We believe this evidence was sufficient to establish as a matter of law that plaintiff had no cause of action on these policies of insurance. Nichols v. Smith, 507 S.W.2d 518 (Tex.1974); “Moore” Burger, Inc. v. Phillips Petroleum Co., 492 S.W.2d 934, 936 (Tex.1972).

All of plaintiff’s (appellant’s) points of error are overruled. The order of the trial court granting the summary judgment is affirmed.

AFFIRMED.