text:
    George Roland MARTIN, Jim Carl Martin, and Raymond Ire Martin, Executors of the Estate of James E. Martin, Appellants, v. Virginia ADAIR, Appellee.
    No. 8250.
    Court of Civil Appeals of Texas, Beaumont.
    May 10, 1979.
    Rehearing Denied June 7, 1979.
    Marlin Thompson, Orange, for appellants.
    Buddie J. Hahn, Vidor, for appellee.
   CLAYTON, Justice.

Plaintiff, Virginia Adair, filed these original proceedings in the nature of a motion .to reduce to judgment pursuant to Tex. Family Code Ann. § 14.09 (Vernon 1975), Texas Family Code, against defendant as Independent Executors of the Estate of James E. Martin, deceased. Defendants have perfected this appeal from an adverse judgment against them.

Plaintiff and James E. Martin, deceased, were married on or about the 27th day of June 1955. On the 17th day of February 1960 a divorce decree was entered granting a divorce to plaintiff, granting plaintiff the “full care, custody and control of [their three] minor children,” and ordering James E. Martin to pay child support in the sum of $30.00 per week “until said children attain the age of eighteen years, respectively.” James E. Martin died on the 11th day of August 1974. On August 29, 1974, the named defendants qualified as co-independent executors of the Estate of James E. Martin, deceased.

Plaintiff instituted these proceedings below, against defendants as Independent Executors of such estate on the 14th day of August 1975. Her First Amended Motion for Judgment states that James E. Martin, during his lifetime, had not complied with the divorce decree as to child support payments, and at the time of his death “he was indebted to Plaintiff in the amount of $6,477.94. . . . That pursuant to [the provisions of Section 14.091 of the Texas Family Code, Plaintiff moves that the Court render judgment against the Estate of James Eldridge Martin, for unpaid child support as alleged herein.” The trial court, in a non-jury trial, entered judgment against the Estate of James Eldridge Martin, deceased, in the sum of $6,477.94 and awarded plaintiff the sum of $1,500 for attorney fees.

Although defendants have brought forward ten points of error, we are convinced the controlling question before this court is whether the Estate of James Eldridge Martin, deceased, is liable for the unpaid child support payments, as decreed by the trial court, under the facts heretofore stated.

Tex.Prob.Code Ann. § 87 (Vernon Supp. 1978) provides that “when a person dies, leaving a lawful will, all of his estate devised or bequeathed by such will shall vest immediately in the devisees or legatees of such estate . . .; subject, however, to the payment of the debts of the testator . . . .” Under this section of the Probate Code only debts of the deceased can be paid from the assets of the estate.

Child support payments, ordered by court decree, have been held not to be a debt within the meaning of our constitutional prohibition against imprisonment for debt. Smith v. Bramhall, 563 S.W.2d 238 (Tex.1978); Ex parte Birkhead, 127 Tex. 556, 95 S.W.2d 953, 955 (1936); Cunningham v. Cunningham, 120 Tex. 491, 40 S.W.2d 46, 51 (1931); Ex parte Davis, 101 Tex. 607, 111 S.W. 394 (1908); Clay v. Siercovich, 388 S.W.2d 25 (Tex.Civ.App.—Waco 1965, no writ).

Prior to the enactment of the Family Code, the only remedy available to the parent who had received custody of a minor child was to have the party owing the child support held in contempt of court. Contempt is still an available remedy under Sec. 14.09(a) and (b) of the Family Code. Section 14.09(c) now provides an additional remedy which is to file a motion to reduce unpaid child support to judgment. In Harrison v. Cox, 524 S.W.2d 387 (Tex.Civ.App.—Fort Worth 1975, writ ref’d n. r. e.), the court states:

“We are convinced that the purpose of Art. 14.09 was to provide courts with efficient means of enforcing the payment of child support obligations and that the Legislature intended the different remedies provided by that Statute for the collection of child support to operate independently of each other as well as concurrently. . . . ”

Sec. 14.09(c) of the Family Code provides that the court, upon proper motion, may render judgment against a defaulting party for any amount unpaid and owing after ten days’ notice to the defaulting party of his failure or refusal to carry out the terms of the order. The judgment may be enforced by any means available for the enforcement of judgments for debts. This statute was only intended to be an enforcement section. It does not create a new cause of action. Houtchens v. Matthews, 557 S.W.2d 581 (Tex.Civ.App.—Fort Worth 1977, writ dism’d).

Prior to the enactment of Sec. 14.09 of the Family Code, there could be no recovery by the wife against her deceased husband’s estate for the aggregate sums of unpaid child support payments. Clay v. Siercovich, supra.

We have found only one case holding the estate of a deceased husband liable for the delinquent child support payments. In Smith v. Bramhall, 556 S.W.2d 112 (Tex.Civ.App.—Waco 1977), writ ref’d n. r. e. per curiam, 563 S.W.2d 238 (Tex.1978), the Court of Civil Appeals held that such delinquent payments constituted a debt for which judgment could be taken against the deceased husband’s estate. The Supreme Court, in denying the application for writ of error, states, “Our action should not be interpreted as approving the conclusion of the Court of Civil Appeals that ‘unpaid child support is . . .a debt for which judgment may be taken’. . . .” Section 14.09(c) of the Texas Family Code provides only that unpaid child support may be reduced to judgment and enforced by the same means as a judgment for a debt, not that such sums are debts. Smith v. Bramhall, supra at 239.

Since child support payments do not constitute a debt, such support payments are merely a personal obligation of the defaulting party. This obligation can only be enforced against the husband either by contempt proceedings or by the rendition' of a judgment against him for such delinquent support payments. Once the judgment has been obtained against the defaulting party then such judgment can be enforced by the same means as a judgment for a debt. In the absence of a judgment against the defaulting party during his lifetime, a judgment cannot be taken against his estate.

The judgment of the trial court is reversed, and we render judgment that plaintiff take nothing.

REVERSED and RENDERED.


source: Caselaw Access Project

author: GUITTARD, Chief Justice.

license: Public Domain

text:
    Wendell REICH and Robert Paul, Appellants, v. REED TOOL COMPANY, Appellee.
    No. 19812.
    Court of Civil Appeals of Texas, Dallas.
    May 14, 1979.
    Rehearing Denied June 18, 1979.

      Jack G. Kennedy, C. Larry Cain, Kennedy, Minshew, Evans, Campbell & Cain, Sherman, for appellants.
    A. H. Evans, William L. LaFuze, Vinson & Elkins, Houston, for appellee.
    Before GUITTARD, C. J., and STOREY and HUMPHREYS, JJ.
   GUITTARD, Chief Justice.

This suit was brought for commissions alleged to be due under a written contract for sale of an invention and the inventor’s rights to a patent, which had been applied for but not issued when the contract was signed. One of the defenses was that the inventor had “misused” the patent by requiring the purchaser to pay commissions on sales of equipment not covered by the patent applied for. After a trial and verdict, the judge disregarded findings favorable to plaintiffs and rendered judgment for defendant based on a single finding relating to the defense of patent misuse. Plaintiffs appeal on the ground that the court erred in applying the “patent misuse” doctrine under the circumstances of this case and also on the ground that the issue of misuse was not correctly submitted. We affirm on the ground that the doctrine applies, even though the inventor’s right to the patent was only prospective when the contract was signed, and that the finding on the issue in question is sufficient, in the absence of objection, to support the judgment.

The inventor in this case was plaintiff Wendell Reich, who was in the business of making and selling rotary earth-drilling equipment for water wells. Reich had invented a type of mobile rotary drill and had applied for a patent. While application for this patent was pending, Reich and plaintiff Robert Paul, a business associate, entered into negotiations with Texoma, Incorporated, a subsidiary of defendant Reed Tool Company, for sale of this invention and the inventor’s rights under the patent application. These negotiations resulted in the contract in question. The contract provides for sale of the invention and prospective patent rights in consideration of certain payments, including the commissions now claimed. These commissions are payable at specified rates on sales of the “product,” defined in the contract as including not only the invention covered by the claims of the patent application, but also other types of rotary earth-drilling equipment. The crucial language of the definition covering such other types of equipment is paragraph (l)(d), as follows:

[A]ny other rotary earth-drilling equipment manufactured and sold by TEXO-MA during the continuance of this Agreement, provided, however, that this Subsection (d) shall not be deemed to apply to or to include such equipment which is the subject of either a bona fide and genuine patent application filed by any third party(ties) or covered by United States Letters Patent owned by TEXO-MA or any third party(ies) and contains only such other elements or features which are within the public domain. [Emphasis added.]

The contract continues for a period of five years or until three hundred “products” shall be sold or $1,500,000 in commissions paid. During this period Texoma is given the right to an injunction restraining Reich and Paul from competing in the manufacture and sale of rotary drilling machines. The contract further provides that if Texo-ma should decide to terminate the manufacture and sale of “products” as defined in the contract, it should have no further liability, but must give notice to Reich and Paul, who have the option to require a reassignment to them of all rights under the patent application and any patent issued on it.

After the contract was signed, Reich discontinued his own business and entered the employment of Texoma, which was succeeded by defendant Reed Tool Company. Neither Texoma nor defendant had previously been in the business of making and selling earth-drilling equipment. When Reich’s patent application was granted, the patent was issued to defendant as assignee. Defendant made and attempted to sell several of the machines, but according to defendant’s evidence, the venture was not a financial success. Defendant then gave Reich and Paul notice that it was terminating manufacture and marketing of the “product.” Reich exercised his option to require a reassignment of the patent, and defendant made such a reassignment. Defendant did not, however, terminate the business of manufacture and sale of earth-drilling equipment. Instead, it undertook the manufacture and sale of another machine, known as the “Stonekiller,” on which an earlier patent had expired. Defendant took the position that this machine was not within the definition of “product” in section (l)(d) of the contract. Reich and Paul, on the other hand, asserted that the Stonekil-ler was within this definition, and they brought this suit to recover commissions on these sales at the rates provided in the contract. Defendant pleaded also that their agreement to make payments on the sale of machines not covered by the Reich patent was a misuse of the patent and of the patent application and, therefore, unenforceable.

1. Misuse of Patent Application

Patent misuse is a doctrine developed by the federal courts to prevent the holder of a patent from using his statutory and constitutional monopoly power to coerce economic benefits not directly flowing from the rights granted by the patent. For example, the holder cannot tie sales of a patented device to purchase of unpatent-ed supplies. Morton Salt Co. v. G. S. Suppiger Co., 314 U.S. 488, 62 S.Ct. 402, 86 L.Ed. 363 (1942). He cannot exact royalties for the use of a patented invention after the patent expires. Brulotte v. Thys, 379 U.S. 29, 85 S.Ct. 176, 13 L.Ed.2d 99 (1964). Also, he cannot control the resale price of patented products. Straus v. Victor Talking Machine Co., 243 U.S. 490, 37 S.Ct. 412, 61 L.Ed. 866 (1917).

Appellants Reich and Paul contend that the doctrine of patent misuse does not apply to the sale of an application for a patent, as distinguished from the sale of a patent already issued, because until the patent is issued the applicant has no monopoly power subject to abuse. On this question the authorities are inconclusive.

Appellants rely principally on Heltra, Inc. v. Richen-Gemco, Inc., 395 F.Supp. 346 (D.S.C.1975), rev’d on other grounds 540 F.2d 1235 (4th Cir. 1976). Heltra, as we view it, does not bear on this point. Although the contract in Heltra was similar in some respects to that in this case, the question was not one of patent abuse, but rather whether one who had purchased the rights to an invention, including the rights under a patent application, could deny liability for the purchase money on the ground that the patent, when later issued, was invalid. Hel-tra stands for the rule that in this situation the validity of the patent is immaterial to the purchaser’s liability. There was no provision in the Heltra contract for payments based on sales of other devices, nor was patent abuse raised as a defense to the suit.

The cases cited by appellee lend some support to appellee’s position, though none presented the exact question now before us. Appellee contends that the rationale of the misuse doctrine is equally applicable to agreements involving prospective or inchoate patent rights, such as those flowing from patent applications, as to agreements involving issued patents. It relies on the test of patent misuse laid down by the Supreme Court in Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 89 S.Ct. 1562, 23 L.Ed.2d 129 (1969), and on decisions of federal trial courts and courts of other states. The Zenith case concerned issued patents rather than patent applications. Hazeltine owned patents on television sets which it offered for license to Zenith on condition that Zenith pay royalties on all television sets manufactured, regardless of whether any of the inventions subject to Hazeltine’s patents were employed. Zenith refused the offer, and Ha-zeltine sued Zenith for infringing some of its patents. The Supreme Court held in favor of Zenith on its defense that Hazel-tine’s offer constituted patent misuse. The Court said:

We hold that conditioning the grant of a patent license upon payment of royalties on products which do not use the teaching of the patent does amount to patent misuse. 395 U.S. at 135, 89 S.Ct. at 1583. And just as the patent’s leverage may not be used to extract from the licensee a commitment to purchase, use, or sell other products according to the desires of the patentee, neither can that leverage be used to garner as royalties a percentage share of the licensee’s receipts from sales of other products. In either case, the patentee seeks to extend the monopoly of his patent to derive a benefit not attributable to use of the patent’s teachings. 395 U.S. at 136, 89 S.Ct. at 1583. . . But we discern no basis in the statutory monopoly granted the patentee for his using that monopoly to coerce an agreement to pay a percentage royalty on merchandise not employing the discovery which the claims of the patent define. 395 U.S. at 140, 89 S.Ct. at 1585.

Appellee relies on two state-court cases involving contracts made when applications for patents were pending, but in each the misuse doctrine was held inapplicable under the Zenith test because the evidence failed to show that the patent applicant had conditioned his assignment or license or prospective patent rights on payments unrelated to sales of products covered by the patent application. Mutchnik v. M. S. Willett, Inc., 274 Md. 610, 337 A.2d 72 (1975); Richards v. Liquid Controls Corp., 26 Ill.App.3d 111, 325 N.E.2d 775, 784 (1975). In Mutch-nik, the court observed that when the agreement was negotiated, no patent had been issued and at most the licensee’s bargaining position was influenced by the existence of the pending patent application.

Appellee relies also on three federal district court opinions. In Key Pharmaceuticals, Inc. v. Lowey, 373 F.Supp. 1190, 1193 (1974), the grantee of an exclusive license to make certain pharmaceuticals according to a process described in a patent application sued to rescind the agreement and was allowed by the court to amend its complaint to add a count alleging misuse in that the licensee was required to pay royalties on specified products, regardless of whether produced by the processes described in the patent application. The opinion does not discuss application of the misuse doctrine to a patent application, but seems to assume that it would apply if the allegations should be supported by proof.

The other two federal district court cases were patent infringement suits in which the patentees were held disqualified to sue on the ground that they had misused their patents by making license agreements with third parties tending to restrict sales of similar products. Krampe v. Ideal Industries, Inc., 347 F.Supp. 1384, 1386-87 (N.D.Ill.1972); Anderson Company v. Trico Products Corp., 237 F.Supp. 834, 838 (W.D.N.Y. 1964). In each of these cases the agreements had been made when the application for the patent was pending, but the plaintiff had undertaken to enforce the restriction after the patent had been issued to him. In Krampe the court observed that the plaintiff “possessed inchoate rights” in the invention from the time he filed his application and held:

Accordingly, this Court finds that plaintiff’s use of the rights which he possessed in his invention to secure an additional right to which he was not entitled, combined with his maintaining the objectionable terms of the contract after these rights had ripened into a patent monopoly, constitutes misuse of his patent for the cable stripper.

Appellants point out that in the present case, unlike the plaintiffs in Krampe and Anderson, Reich never owned the patent in question and the parties never contemplated that he would because, by the contract in question, he assigned all his rights under the applications to Texoma, to whose successor the patent was issued pursuant to the assignment. Appellants also argue that there could be no misuse of the monopoly rights granted by the patent in question here because an applicant has no monopoly until the patent is issued, and, since no patent was ever issued to Reich, he could not be guilty of misuse. We do not agree that an applicant who assigns his prospective patent rights can never be guilty of misuse. An inventor who has applied for a patent on a marketable invention may indeed have bargaining leverage to exact benefits he could never get if he did not have a patent application with a fair prospect of success. If he conditions the sale of his prospective patent rights on a promise of payments based on sales of unrelated products, he is using his prospective monopoly power to obtain benefits beyond the scope of his prospective monopoly. He should be in no better position than if the patent had already been issued.

Neither is it essential to the misuse doctrine that the inventor continue to use the leverage of his monopoly after the patent has been issued. If he has obtained a promise of benefits unrelated to the patent on condition of an assignment of his patent rights, whether actual or prospective, such a promise is within the rationale of the misuse doctrine, as stated by the Supreme Court in Zenith. Consequently, we hold in this case that the defense of patent misuse is available, even though Reich had no patent when he sold his invention and his prospective rights under the patent application.

2. Evidence and Findings of Patent Misuse

Appellants contend further that even if the misuse doctrine is available as a defense to a suit on a contract made before the patent is issued, no misuse is established by the evidence and verdict in this case. They argue that a fact issue on misuse is made by the evidence in this case, and that appellee failed to obtain a jury finding that would support the judgment in appellee’s favor.

We agree with appellants that a fact issue is raised. Appellee’s evidence tends to show that Texoma’s representatives proposed the contract without paragraph (l)(d), which brings other drilling equipment manufactured and sold by Texoma within the definition of “products” on which commissions must be paid. Appel-lee’s witnesses testified that Reich insisted on this provision and that Texoma agreed to it only because Reich’s rights to the invention and his prospective patent rights could not be obtained on any other terms. On the other hand, appellants’ evidence tended to show that the patent application was not a primary item in the negotiations leading to the contract. Appellants assert that appellee was eager to get into the shallow-well drilling equipment business in which Reich was already established, that appellee, through its subsidiary, Texoma, not only bought the invention and the patent application from Reich, but took over his business, obtained his services, and secured his agreement not to compete. Thus, according to appellants, it was reasonable and proper for the parties to agree on a consideration that included commissions on sales of equipment, whether or not covered by the claims of the patent application assigned in the contract. In response appellee points out that the contract by which Reich entered appellee’s employment and agreed not to compete was a separate transaction supported by an independent consideration, and it insists that the agreement in the contract in question to pay commissions on unrelated products must be taken as part of the consideration for Reich’s assignment of his prospective patent rights.

This question is not resolved by the provisions of the contract itself, as both parties agree. In the case of a patent license, it is not per se a misuse to measure the consideration by a percentage of the licensee’s total sales, including sales of products not within the patent. Automatic Radio Mfg. Co. v. Hazeltine Research, Inc., 339 U.S. 827, 834, 70 S.Ct. 894, 94 L.Ed. 1312 (1950). Misuse occurs when the patentee conditions the license on payments based on sales of other products, and thus uses the leverage of his monopoly to coerce an agreement to make payments based on sales of merchandise not employing the discovery which the claims of the patent define. Zenith Radio Corp. v. Hazeltine Research, Inc., 395 U.S. 100, 139-40, 89 S.Ct. 1562, 23 L.Ed.2d 129 (1969). Consequently, the negotiations leading up to the contract are relevant to determine whether improper conditioning has occurred, and the party asserting misuse has the burden of proof. Mutchnik v. M. S. Willett, Inc., 274 Md. 610, 337 A.2d 72, 75-77 (1975). Determination of this issue requires a finding of fact. Glen Mfg., Inc. v. Perfect Fit Industries, Inc., 420 F.2d 319 (2d Cir. 1970).

Appellants insist that no such fact finding has been made in this case. The finding on which appellee relies to support its defense of misuse is the following:

SPECIAL ISSUE NO. 2: Do you find from a preponderance of the evidence that Plaintiff Reich would not have entered into the agreement sued upon if Article (l)(d) thereof had not been included in the agreement?
ANSWER: We do.

Appellants argue that this issue is eviden-tiary and that the answer is immaterial because the proper issue under Zenith and the other authorities above cited is whether appellants conditioned their assignment of patent rights on the payments promised; that is, whether plaintiffs used their patent power to compel insertion of paragraph (l)(d) in the contract. Appellants bring forward no objection to the issue as submitted. They assert that they had no burden to point out the defect in the issue because the burden was on appellee to obtain a finding establishing the defense of misuse.

We conclude that the issue as submitted and answered is sufficient, in the absence of objection, to support the defense of misuse. Though possibly subject to objection as evidentiary, it was submitted in connection with appellee’s plea of patent misuse and gave notice to plaintiffs that an affirmative answer might be taken as a basis for a judgment sustaining that plea. Consequently, appellants were required to point out any defect by a timely objection to the issue. Allen v. American Nat’l Ins. Co., 380 S.W.2d 604 (Tex.1964). They could not wait until after judgment and then assert that the finding should be disregarded in rendering judgment. Lanphier Const. Co. v. Fowco Const. Co., 523 S.W.2d 29, 43 (Tex.Civ.App.—Corpus Christi 1975, writ ref’d n.r.e.); Panhandle & S. F. Ry. v. Friend, 91 S.W.2d 922, 930 (Tex.Civ.App.—Austin 1936, writ ref’d). A complaint that an issue is evidentiary rather than ultimate is among those that are waived by failure to make a timely objection, and in the absence of such an objection, an issue subject to such a complaint may form the basis of a judgment. Weingarten, Inc. v. Scott, 456 S.W.2d 266, 271 (Tex.Civ.App.—Houston [14th Dist.] 1970, no writ). Although in the cases cited the courts rested the waiver on the complaining party’s failure to make a timely objection, the same rule, in our opinion, applies if an objection is made but is not brought forward on appeal as a ground for a new trial. Consequently, even if appellants objected to the issue in the trial court, they- have waived it by not bringing it forward in their brief on this appeal as a ground for a new trial.

Although issue number two may be subject to objection, it bears directly on the defense of misuse. In Zenith the concept of “conditioning” a patent license is explained as “where the patentee refuses to license on any other basis and leaves the licensee with a choice between a license so providing and no license at all.” 395 U.S. at 135, 89 S.Ct. at 1583. The same test has been applied to an assignment. Compton v. Metal Products, Inc., 453 F.2d 38, 46 (4th Cir. 1971). The jury found in answer to issue number two that Reich “would not have entered into the agreement sued upon if Article (l)(d) had not been included.” This answer is equivalent to a finding that plaintiffs refused to assign their patent application on any other basis and left Texoma with a choice between an assignment containing article (l)(d) and no assignment at all. Appellants have not suggested any additional factual element that should have been submitted to establish that plaintiffs conditioned the assignment on Texoma’s promise to pay commissions on sales of products not covered by the claims of the patent application. If any additional finding was necessary to establish the defense of misuse, such a finding must be deemed to have been made by the trial court in support of the judgment in the absence of objections to failure to submit the omitted component. Rule 279, Tex.R.Civ.P.; Kirk v. Standard Life & Accident Ins. Co., 475 S.W.2d 570, 572 (Tex.1972); Rogers v. Ellsworth, 501 S.W.2d 756, 757 (Tex.Civ.App.—Houston [14th Dist.] 1973, writ ref’d n.r.e.). No such objection appears in the present record. We hold, therefore, that the answer to issue number two is material, that appellants waived any defect in it, and that the trial judge did properly base his judgment on it.

Affirmed.


author: HUTCHINSON, Justice.

text:
    JOHNSON ENGINEERS, INC., Appellant, v. TRI-WATER SUPPLY CORPORATION, Appellee.
    No. 8678.
    Court of Civil Appeals of Texas, Texarkana.
    May 15, 1979.

      Terry M. Thorn, Paxton, Whitaker & Parsons, Palestine, for appellant.
    Bascom Perkins, Perkins & Perkins, Mt. Pleasant, for appellee.
   HUTCHINSON, Justice.

This is a suit for payment under a construction contract. Appellant, Johnson Engineers, Inc., contracted to construct a water distribution system for appellee, TriWater Supply Corporation, in Titus and Franklin Counties. Upon the completion of the contract, appellant demanded the final payment and upon appellee’s refusal instituted this suit. As an offset, appellee plead the provisions of the contract that provided for liquidated damages in the sum of $100.00 per day for each day of delay by appellant after the allotted completion time. Trial was before the court and judgment entered for appellant for the amount due under the contract less $100.00 per day for 138 days as liquidated damages for delay of completion.

After the conclusion of the evidence and the dismissal of the witnesses and during argument of counsel, it was for the first time brought to the attention of the trial court that appellant was contending that the liquidated damage provision was in fact a penalty and therefore unenforceable and uncollectible. Appellant had not so plead and requested leave to file a trial amendment to allege penalty as an affirmative defense to the claimed offset. The filing of the proffered trial amendment was refused. Prior to the formal entry of judgment appellant filed a motion to re-open the case for the submission of additional evidence, if necessary, for the consideration of penalty as an affirmative defense. This motion was denied. Appellant does not here complain of this ruling.

Appellant here contends that the trial court abused its discretion in refusing to permit the filing of its proffered trial amendment under Rule 66 of the Texas Rules of Civil Procedure which states in part:

“. . .if during the trial any defect, fault or omission in a pleading, either of form or substance, is called to the attention of the court, the court may allow the pleadings to be amended and shall do so freely when the presentation of the merits of the action will be subserved thereby and the objecting party fails to satisfy the court that the allowance of such amendment would prejudice him in maintaining his action or defense upon the merits . . .

Appellant readily admits that under Rule 94 of the Texas Rules of Civil Procedure it should have affirmatively plead that the liquidated damage provision of the contract was in fact a “penalty” and therefore unenforceable but contends that since its offered evidence had been received, without objection on the part of appellee, to the effect that the liquidated damages specified in the contract were not a reasonable forecast of actual damages but were arbitrary figures constituting a penalty, the trial court erred in refusing the trial amendment. State v. Beever Farms, Inc., 549 S.W.2d 223 (Tex.Civ.App. San Antonio 1977, writ ref’d n. r. e.); Vermillion v. Haynes, 147 Tex. 359, 215 S.W.2d 605 (1948). In Vermillion, as here, the proffered amendment sought only to assert a defense in law based upon facts already received in evidence. Appellant in its brief before this Court states that the sole purpose of the proposed trial amendment was to bring before the court a law question based upon an issue tried by consent. We will therefore consider the matter here as though the trial court had permitted the filing of the amendment and considered its contents in its pronouncement and entry of judgment.

The only evidence in the record relied upon by appellant on this issue is the testimony of the chief engineer for the project called as a witness by the appellee. Appellant on cross-examination of this witness produced testimony to the effect that the liquidated damage provision was placed in the contract by him without discussing it with either the appellant or appellee. He placed this provision in the contract because it was the one suggested by the Farmers Home Administration. This testimony was received without objection.

Appellant now contends that the testimony of the chief engineer constituted a factual defense to the claim for liquidated damages and that the refusal to permit a pleading amendment to bring before the court a law question based thereon was a clear abuse of the court’s discretion that requires a reversal and another trial.

Appellant, in addition to its burden of pleading its asserted defense, also had the burden of proving that the contract provision providing for liquidated damages was in fact a penalty provision. In order to meet this burden, appellant was obliged to prove the amount of appellee’s actual damages, if any, for the purpose of showing an absence of an approximation between the actual loss and the stipulated sum. Robinson v. Granite Equipment Leasing Corp., 553 S.W.2d 633 (Tex.Civ.App. Houston—1st Dist. 1977, writ ref’d n. r. e.); Oetting v. Flake Uniform & Linen Service, Inc., 553 S.W.2d 793 (Tex.Civ.App. Fort Worth 1977, no writ); Smith v. Lane, 236 S.W.2d 214 (Tex.Civ.App. San Antonio 1950, no writ); Southern Plow Co. v. Dunlap Hardware Co., 236 S.W. 765 (Tex.Civ.App. Dallas 1922, no writ); Walsh v. Methodist Episcopal Church, 212 S.W. 950 (Tex.Com.App.1919, jdgmt. adopted). If the stipulated sum is shown to be disproportionate to actual dam ages, the stipulation must be declared to be a penalty and recovery limited to actual damages. Important factors to be considered in making this determination are the certainty or uncertainty of the actual damages occasioned by the delay and the ease or difficulty of the ascertainment or proof of such damages. Appellant offered no evidence whatsoever upon the extent, if any, of appellee’s actual damage and there is no evidence in the record upon which the court could determine with any degree of certainty the actual damages caused by the delay. Nor did the appellant attempt to show that appellee could have by competent evidence proved within a permissible range its actual damages.

Too, the trial court from the type and extent of the contract and the nature of appellee’s legal entity, all of which was in evidence, could have found that any attempt to establish the actual damages would be met with such uncertainties and difficulties as to require a court to sustain the contract provisions for liquidated damages. Oetting v. Flake Uniform & Linen Service, Inc., supra.

In view of the tendered evidence on this issue, we are of the opinion that the failure of the trial court to permit the filing of the trial amendment after the completion of the receipt of evidence, if error, was harmless. Tex.R.Civ.P. 434.

The judgment of the trial court is affirmed.


author: OSBORN, Justice.

text:
    ROBBERSON STEEL, INC., Appellant, v. J. D. ABRAMS, INC., et al., Appellees.
    No. 6770.
    Court of Civil Appeals of Texas, El Paso.
    May 16, 1979.
    Rehearing Denied June 13, 1979.

      Pearson, Caballero & Warach, Ray Pearson, El Paso, H. J. “Doc” Blanchard, Austin, for appellant.
    Johnson & Bowen, Phillip C. Bowen, El Paso, for appellees.
   OPINION

OSBORN, Justice.

This case arises out of a breach of contract between a steel fabricator and a construction company who had contracted to build four bridges for the State of Texas. The trial Court found for the steel fabricator as to the amount due for steel furnished but unpaid for and provided for recovery of attorney’s fees as found by the jury, but the Court allowed the construction company an offset for the amount of its damages as found by the jury to have resulted from the delay in delivery of the steel for the bridges. We affirm.

J. D. Abrams, Inc. (contractor) sued Rob-berson Steel, Inc. (fabricator) for damages resulting from a timely failure to furnish structural steel for four bridges being constructed for the Texas Highway Department in El Paso County, Texas. After Abrams became the successful bidder on this project it entered into a written contract with Robberson to furnish the necessary structural steel at various dates for a certain price per unit of steel. Overall the contract price was $1,347,214.33. The purchase order issued by Abrams to Robberson is dated 4-8-74 and it sets forth the shipping dates for the four different structures to be completed. Paragraph 8 of the General Conditions of the purchase order states “Delivery of materials will be in accordance with the construction schedule established by J. D. Abrams, Inc. Time is the essence of this Contract * * *.”

Robberson was unable to obtain steel from the steel mills and was approximately six months late in delivering some of the fabricated steel to Abrams. That delay resulted in this suit. Robberson claimed the delay was excused under Section 2.615, Tex. Bus. & Comm.Code. It also pled waiver as a defense. Robberson filed a cross-action against Abrams and Argonaut Insurance Company, the surety on its payment bond, for the balance due on the purchase price of steel delivered, plus interest and attorney’s fees. The trial Court found the amount owed by Abrams to Robberson to be $204,-990.58 and did not submit any issue to the jury on that claim. There is no complaint about that finding.

In answer to Special Issue No. 1, the jury found Abrams’ damages from the delay in delivery of steel to be $127,250.00. The next four issues about which there is substantial dispute are as follows:

“SPECIAL ISSUE NO. 2
“Was the delay in the delivery of the fabricated steel by the defendant the result of the Steel Mills’ inability to furnish the steel to the Defendant?
“ANSWER ‘YES’ OR ‘NO’.
“ANSWER: YES
“If you have answered the following Special Issue ‘Yes’, then but not otherwise, answer the following Special Issue.”
“SPECIAL ISSUE NO. S
“Was such inability on the part of the Steel Mills to furnish the steel to the Defendant, if you have so found, a contingency the non-occurrence of which was a basic assumption of the parties on which the contract (Plaintiff’s Exhibit-22A, B, C) was made?
“ANSWER ‘YES’ OR ‘NO’
“ANSWER: YES
“If you have answered the foregoing Special Issue ‘Yes’, then but not otherwise, answer the following Special Issue.”
“SPECIAL ISSUE NO. 4
“Did the Defendant, Robberson Steel, Inc. seasonably notify the Plaintiff, J. D. Abrams, Inc. of the delay in delivery?
“ANSWER ‘YES’ OR ‘NO’
“ANSWER: YES
“If you have answered the foregoing Special Issue ‘Yes’, then but not otherwise, answer the following Special Issue.”
“SPECIAL ISSUE NO. 5
“Did the Defendant, Robberson Steel, Inc. allocate the steel it received from the Steel Mills among its customers in a fair and reasonable manner?
“ANSWER ‘YES’ OR ‘NO’
“ANSWER: YES”

In addition, the jury failed to find a waiver of timely delivery as required by the purchase order, found Robberson gave written notice by certified mail of nonpayment of its claim to Abrams and Argonaut, and found Robberson’s attorney’s fees for prosecuting its claim to be $7,200.00.

After the verdict was received .various motions for judgment were filed by the parties. The trial Court entered judgment based upon its finding that Abrams and Argonaut were indebted to Robberson for steel delivered and unpaid for in the amount of $204,990.58, plus the sum of $7,200.00 for attorney’s fees, and interest on such sums from the date of the verdict on July 6,1977, less the offset of $127,250.00 as damages for delay in delivery of steel. In entering such judgment the trial Court found “1. Robberson Steel, Inc., considered the availability of steel prior to entering into the contract; and 2. Robberson Steel, Inc., assumed the risk of non-availability of steel under the contract; and 3. By the contract terms, Robberson Steel, Inc., assumed the obligation to deliver steel in strict accordance with the schedule in the contract;” and granted Abrams’ motion for judgment non obstante veredicto and motions for judgment on the basis of the verdict and findings of the Court on unsubmit-ted issues. The net effect of the judgment was that the trial Court made findings on certain controlling issues as to the defense of delay in delivery of steel under Section 2.615, Tex.Bus. & Comm.Code, and set aside certain jury findings on those issues.

By the first four points of error Robber-son complains of the trial Court’s disregarding the jury’s answers to Special Issues Nos. 2 through 5 and entering judgment notwithstanding those findings. Points of Error Nos. 5, 6 and 7 complain about the trial Court making findings on unsubmitted issues which form the basis for the trial Court’s judgment.

The controlling provision in Section 2.615, Tex.Bus. & Comm.Code, provides that “Delay in delivery * * * by a seller * * is not a breach of his duty under a contract for sale if performance as agreed has been made impracticable by the occurrence of a contingency the non-occurrence of which was a basic assumption on which the contract was made * * *.” In United States v. Wegematic Corporation, 360 F.2d 674 (2d Cir. 1966) the Court said this “test seems a somewhat complicated way of putting Professor Corbin’s question of how much risk the promisor assumed. Recent Developments in the Law of Contracts, 50 Harv.L.Rev. 449, 465-66 (1937); 2 Corbin, Contracts § 1333, at 371.” In West Los Angeles Institute for Cancer Research v. Mayer, 366 F.2d 220 (9th Cir. 1966), the Court in considering the test to be applied with regard to impossibility in the performance of a contract said:

“The ultimate question in every case is ‘whether or not proper interpretation of the contract shows that the risk of the subsequent events, whether or not foreseen, was assumed by the promisor. If it appears from the nature of the contract as well as from the surrounding circumstances that, although they were reasonably foreseeable, the promisor did not assume the risk of the subsequent events, the contract shows a gap subject to supplementation in accordance with rules of objective law. Conversely, if the contract, properly construed, shows that the promisor assumed the risk of unanticipated events, the occurrence of such events does not excuse performance.’ Smit, 58 Colum.L.Rev. 287, 314 (1958). See also L. N. Jackson & Co. v. Royal Norwegian Gov’t, 177 F.2d 694, 699 (2d Cir. 1949); 6 Williston, Contracts § 1953, pp. 5475-5476; Restatement, Contracts §§ 288, 461.”

The evidence reflects that a representative of Robberson first contacted Abrams about supplying the fabricated steel for the four bridge structures at the time of the bid letting in March, 1974. After Abrams received the contract from the State, Mr. Miles Hart, General Manager and Vice-President of Robberson, came to El Paso in April seeking the steel fabrication work on this job. On April 5, 1974, a firm price of $41.60 per cwt was agreed upon. The purchase order was issued on April 8, 1974, approved by Miles Hart on April 10, 1974, and executed by Robberson officers in May, 1974. But prior to executing the contract Robberson checked with their suppliers to determine that the mills could supply their needs. Richard Taylor, Purchasing Manager for Robberson, testified that two or three weeks before the bid letting by the State he obtained a confirmation through Armco Steel Corporation and U.S. Steel that the steel required on this job would be available. .This is a customary procedure for him in the business. He then testified as to the next step in the process as follows:

“Q. What if anything, happened after your confirmation?
A. I was advised after the letting that we were successful in getting the job.
Q. What did you do, if anything, thereafter?
A. I reconfirmed with the mills that the scheduled delivery was still on time.
Q. Was there any concern, when was this, what date approximately was this?
A. Approximately April 15, through the 20th.
Q. Was there any concern after the first confirmation that there would be, the schedules would not be met?
A. No, there was not.
Q. I will ask you, whether or not, when you say you reconfirmed is that through purchase orders?
A. Yes, sir.”

Both Mr. Larwig, Executive Vice-President of Robberson, and Mr. Hart also testified to the fact that Robberson had checked on delivery and received a confirmation from the rolling mills before this contract was signed.

The evidence also established that the mill at Armco Steel Corporation with whom Robberson had placed its order, broke down, and Robberson could not get delivery as expected and therefore it was six months late in some shipments to Abrams. There was substantial evidence as to the expense and cost to the contractor in being six months longer than originally planned in completing the project.

As noted by the evidence set forth above, Robberson was concerned about delivery before it entered into the contract with Abrams. It was a contingency about which it reconfirmed with the mills before signing the purchase order which had specific dates for delivery and provided that “Time is the essence of this Contract * * The evidence quoted above clearly shows that delivery from the supplier to the fabricator was very definitely a circumstance within the contemplation of the parties at the time the contract was made.

In Nora Springs Cooperative Company v. Brandau, 247 N.W.2d 744 (Iowa 1976), the Court said “[Ojrdinarily a contingency which reasonably may have been anticipated must be provided for by the terms of the contract, or else the impossibility of performance resulting therefrom does not operate as an excuse.” The fact that this contingency was recognized is best illustrated by the bid sheet, dated March 22, 1974, which Robberson gave to the various contractors who bid this project. That bid sheet stated “Delivery is subject to our ability to procure steel from our steel mill suppliers.” One of the conditions on the back of that bid sheet provided “Seller shall be excused for all delays in deliveries occasioned by * * * inability to secure suitable or sufficient material from customary sources * * *.”

But after having cheeked with their sources of supply Robberson chose not to incorporate those provisions in the purchase order from Abrams and agreed to bind itself to deliver materials in accordance with the construction schedule set forth in the purchase order, with no condition based upon availability of steel from the mills.

One of the major problems in interpreting Section 2.615 of the Code has been with regard to the issue of “foreseeability”. Comment No. 1 under the Section states “This section excuses a seller from timely delivery of goods contracted for, where his performance has become commercially impracticable because of unforeseen supervening circumstances not within the contemplation of the parties at the time of contracting.” One of the leading cases prior to adoption of the Code on the issue of impossibility of performance is Lloyd v. Murphy, 25 Cal.2d 48, 153 P.2d 47 (1944). Justice Traynor, writing for the Court in that case, said:

“ * * * The purpose of a contract is to place the risks of performance upon the promisor, and the relation of the parties, terms of the contract, and circumstances surrounding its formation must be examined to determine whether it can be fairly inferred that the risk of the event that has supervened to cause the alleged frustration was not reasonably foreseeable. If it was foreseeable there should have been provision for it in the contract, and the absence of such a provision gives rise to the inference that the risk was assumed.”

In Murray on Contracts (2d rev. ed. 1974), the author comments in Sections 202 and 204 upon the holding in the Lloyd case and the code provision with regard to the issue of foreseeability as follows:

“It is important to consider the operative circumstances which the case law manifests as particularly important. In the well-known case of Lloyd v. Murphy, 10 the court emphasized the fact that the frustrating event was foreseeable. Moreover, the fact of foreseeability suggests that if the risk was not assumed, some provision in the contract would normally manifest that intention. Finally, the value or purpose of the contract was not entirely destroyed though it may have been substantially restricted. While there are other cases insisting upon the lack of foreseeability as the sine qua non of the frustration defense to excuse nonperformance,11 it is now clear that the fact that the parties did foresee the frustrating event does not, alone, bar the use of the defense if the evidence indicates that the parties entered into the contract on the assumption that the foreseeable risk would not occur.12 Foreseeability is still a factor. However, the critical question remains: did the parties contract on a basic assumption that a particular contingency would not occur?13 If they did, the risk of that contingency was not assumed and, assuming the occurrence of the contingency destroys the purpose of the contract, nonperformance after the frustrating event should be excused.
⅜ ⅜ ⅝ ⅝ ⅜ ⅜
“Another problem found in the basic ‘impossibility’ section of the Code is the use, in a comment, of the term, ‘unforeseen’.60 As suggested in earlier sections, 51 it is becoming more clear that the “unforeseeability” of the contingency is not a sine qua non to excuse the nonperforming party though it is always a factor to be considered in risk allocation. Courts have taken this position while expressly recognizing the contrary Code language.52 * * *”

In Eastern Airlines, Inc. v. McDonnell Douglas Corp., 532 F.2d 957 (5th Cir. 1976), the Court discussed at some length the foreseeability issue and said:

“ * * * The rationale for the doctrine of impracticability is that the circumstance causing the breach has made performance so vitally different from what was anticipated that the contract cannot reasonably be thought to govern. 6 S. Williston, Contracts § 1963 at 5511 (rev. ed. 1938). However, because the purpose of a contract is to place the reasonable risk of performance on the prom-isor, he is presumed, in the absence of evidence to the contrary, to have agreed to bear any loss occasioned by an event which was foreseeable at the time of contracting. Lloyd v. Murphy, 1944, 25 Cal.2d 48, 54, 153 P.2d 47, 50 (Traynor, J.); see Madeirense Do Brasil S. A. v. Stulman-Emrick Lumber Co., 2 Cir. 1945, 147 F.2d 399, 403; McCulloch v. Liguori, 1948, 88 Cal.App.2d 366, 373, 199 P.2d 25, 30. Underlying this presumption is the view that a promisor can protect himself against foreseeable events by means of an express provision in the agreement.
“Therefore, when the promisor has anticipated a particular event by specifically providing for it in a contract, he should be relieved of liability for the occurrence of such event regardless of whether it was foreseeable.97 See Edward Maurer Co. v. Tubeless Tire Co., 6 Cir. 1922, 285 F. 713, 714-715. As Justice Traynor noted for the California Supreme Court under different but nonetheless analogous circumstances,
‘the question whether a risk was foreseeable is quite distinct from the question whether it was contemplated by the parties. . . . When a risk has been contemplated and voluntarily assumed . . foreseeability is not an issue and the parties will be held to the bargain they made.’
“Glenn R. Sewell Sheet Metal, Inc. v. Loverde, 1969, 70 Cal.2d 666, [75 Cal.Rptr. 889], 451 P.2d 721, 728 n. 13; see Lloyd v. Murphy, supra [25 Cal.at at 54], 153 P.2d at 50. * * * ”

The issue of an excuse of impossibility of performance of a contract under Section 2.615 of the Uniform Commercial Code was before the Massachusetts Supreme Court for the first time in Mishara Construction Company, Inc. v. Transit-Mixed Concrete Corp., 310 N.E.2d 363 (1974). In discussing the issue of foreseeability and the rationale behind risk allocation under a contract the Court said:

“ * * * The important question is whether an unanticipated circumstance has made performance of the promise vitally different from what should reasonably have been within the contemplation of both parties when they entered into the contract. If so, the risk should not fairly be thrown upon the promisor.” Williston, Contracts (Rev. ed.) § 1931 (1938). The emphasis in contracts governed by the Uniform Commercial Code is on the commercial context in which the agreement was made. The question is, given the commercial circumstances in which the parties dealt: Was the contingency which developed one which the parties could reasonably be thought to have foreseen as a real possibility which could affect performance? Was it one of that variety of risks which the parties were tacitly assigning to the promisor by their failure to provide for it explicitly? If it were, performance will be required. If it could not be so considered, performance is excused. * * * ”

In the comment in 14 Duquesne Law Review 235 (1976), entitled “Contractual Excuse Based On a Failure of Presupposed Conditions,” the author at 238 states:

“ * * * Excuse under this clause should be found only if the following three questions can be answered affirmatively:
(1) Has a contingency occurred?
(2) Was its non-occurrence a basic assumption upon which the contract was made?
(3) Has the contingency rendered the agreed performance impracticable? * * * it

Clearly under the evidence in this case the first and third questions must be answered in the affirmative, but just as clearly the second question must be answered with a “no”. The evidence established that the contingency which developed was one which the parties could reasonably have foreseen and it was one of that variety of risks which the parties tacitly assigned to the promisor by their failure to provide for it explicitly. While we hold that there is evidence to support the jury’s answers to Special Issues Nos. 2, 4 and 5, there is no evidence to support the answer to Special Issue No. 3. As noted in the Duquesne Law Review Comment, that is a critical issue to the defense presented. Thus we conclude that the trial Court properly disregarded the answer to Special Issue No. 3 and correctly entered judgment without regard to the alleged defense under Section 2.615, Tex.Bus. & Comm.Code. Since the issues under this defense should not have been presented to the jury, the answers became immaterial and the trial Court was authorized under Rule 301, Tex.R.Civ.P., to disregard the answer to those issues. C. & R. Transport, Inc. v. Campbell, 406 S.W.2d 191 (Tex.1966); Grubb v. Grubb, 525 S.W.2d 38 (Tex.Civ.App.—El Paso 1975, writ ref’d n. r. e.). Points of Error Nos. 1 through 4 are overruled.

It is asserted in the second series of points that Abrams waived any ground of recovery on its claim because of the provision of Rule 279, Tex.R.Civ.P. It is asserted that the three findings made by the trial Court are not referable to other issues submitted and therefore they cannot form the basis for a ground of recovery. In this case, there is no question but that Robberson breached its contract to deliver steel at specified times. Having concluded that Robberson had no defense for late delivery the cause of action was established as a matter of law and there was no waiver for failure to request or obtain other findings. Moughon v. Wolf, 576 S.W.2d 603 (Tex.1978). The only element for the fact finder was the unliquidated damages. That issue was presented to the jury in Special Issue No. 1. Thus, Abrams was entitled to recover, as an offset, its damages resulting from the delay in delivery of fabricated steel. The three findings made by the trial Court add nothing, except that the Court concludes that under the undisputed evidence the reverse of the issue presented by Special Issue No. 3 has been established as a matter of law. If it makes any difference, the proof having come from Robberson’s agents does establish as a matter of law that Robberson did consider the availability of steel prior to entering into the contract and Finding No. 1 is proper. The second and third findings are actually conclusions of the Court resulting from the first finding. Points of Error Nos. 5, 6 and 7 are overruled.

Points of Error Nos. 8 and 9 assert that the trial Court erred in entering judgment non obstante veredicto for Argonaut Insurance Company and in disregarding the answers to Special Issues Nos. 2 through 5, because Argonaut did not file a motion for such relief. The contention that Argonaut did not file motions seeking such relief is correct. But Argonaut is liable under its payment bond only for sums owed and unpaid by Abrams. Thus, the offset which was obtained by Abrams necessarily accrued to Argonaut when final judgment was entered for the net amount owed by Abrams to Robberson. To hold otherwise would allow Robberson a double recovery. Points of Error Nos. 8 and 9 are overruled.

The last two points assert error in failing to grant prejudgment interest and in failing to enter judgment for interest on the full amount owed by Abrams to Robberson without regard to any offset. On January 8, 1976, Abrams wrote Robberson saying “We have your final billing in the amount of $204,990.58.” The letter does not dispute that amount as being the correct amount of the account. That was the amount the trial Court found to be due and owing, although a subsequent statement did claim an additional sum of $644.49. In the January letter Abrams claimed an offset of $95,556.00 and tendered payment of $109,434.58.

Article 5069-1.03, Tex.Rev.Civ. Stat.Ann., provides “When no specified rate of interest is agreed upon by the parties, interest at the rate of six percent per an-num shall be allowed on all written contracts ascertaining the sum payable, from and after the time when the sum is due and payable; * * The fact that the amount of Robberson’s recovery could not be ascertained until after a trial of the cause does not affect its right to interest on the amount of its claim from the date the amount was acknowledged, subject to any offset, or counterclaim which might have been established. Beck v. Lawler, 422 S.W.2d 816 (Tex.Civ.App.—Fort Worth 1967, writ ref’d n. r. e.). In this case, after allowing the offset as found by the jury, the amount owed by Abrams to Robberson was $77,740.58. The amount tendered by Abrams with its letter of January 8, 1976, was substantially above the amount actually due and owing. Thus the tender was such as to prevent any interest from accruing on the account. 33 Tex.Jur.2d Venue, Interest, § 6 (1962). Therefore, we overrule Points of Error Nos. 10 and 11.

We have considered the appellee’s Cross-Points Nos. 1 through 4, and they are all overruled.

The judgment of the trial Court is affirmed.


text:
    Melvin BURTON, Jr., Appellant, v. UNITED STATES FIDELITY AND GUARANTY COMPANY, Appellee.
    No. 6791.
    Court of Civil Appeals of Texas, El Paso.
    May 16, 1979.
    Rehearing Denied June 13, 1979.
    Burnett & Ahders Associated, Warren Burnett, W. Ruff Ahders, Norma Venso, Odessa, for appellant.
    Rassman, Gunter & Boldrick, James P. Boldrick, Leslie G. McLaughlin, Midland, for appellee.
   OPINION

OSBORN, Justice.

This is a workmen’s compensation case in which the jury found that the claimant sustained permanent partial incapacity and found the average weekly wage earning capacity during such partial incapacity to be more than the stipulated average weekly wage of the claimant prior to his injury. The Appellant appeals from a take nothing judgment. We reverse and remand.

The claimant sustained a back injury and subsequently had a laminectomy with posterior lateral fusion. Several months later he returned to work for his same employer. The jury found Appellant sustained total incapacity from November 17, 1976, to June 5, 1977, and permanent partial incapacity commencing on June 6, 1977. They further found that Appellant’s average weekly earning capacity during the partial incapacity to be $236.00. The parties had stipulated outside the presence of the jury that Mr. Burton’s average weekly wage prior to the injury was $226.00. The carrier having paid the maximum compensation benefits for the period of total incapacity as found by the jury, the Court entered a take nothing judgment.

The Appellant presents a single point of error asserting a conflict between the jury finding of partial incapacity and the finding of a greater wage earning capacity during the partial incapacity than the stipulated average weekly wage prior to the injury. The Appellant relies upon the holdings in Employers Reinsurance Corporation v. Holland, 162 Tex. 394, 347 S.W.2d 605 (1961), and Home Indemnity Company v. McKay, 543 S.W.2d 171 (Tex.Civ.App.—San Antonio 1976). The opinion in Holland resulted from the granting of a motion for rehearing and is a five-to-four decision. That decision has. been severely criticized. See: dissenting opinion by Justice Smith in Holland, 347 S.W.2d at 608; concurring opinion by Justice Cadena in McKay, 543 S.W.2d at 174; Sartwelle, Workers’ Compensation, 32 Sw. L.J. 361 (1978).

In this case, the Court defined “partial incapacity” and “earning capacity” exactly the same as the trial court did in the McKay case. In the Holland case, the court said that the “average weekly wages before injury must represent, in law, earning capacity before injury.” Thus, there is an irreconcilable conflict where the jury finds that at a given period of time there is a partial incapacity, but also finds that the wage earning capacity after the injury is as much or more than the actual wages earned prior to the injury. The Appellant’s point of error is sustained.

The judgment of the trial Court is reversed and the case is remanded to that Court.


text:
    HENRY S. MILLER REALTY TRUST, Appellant, v. BOBBY McGEES CONGLOMERATION OF DALLAS, INC., Harry Pappas and Robert F. Sikora, Appellees.
    No. 19933.
    Court of Civil Appeals of Texas, Dallas.
    May 16, 1979.
    Rehearing Denied June 16, 1979.

      Glenn A. Portman, Johnson, Bromberg, Leeds & Riggs, Dallas, for appellant.
    David K. Meyercord, Strasburger & Price, Dallas, for appellees.
    Before GUITTARD, C. J., and STOREY and HUMPHREYS, JJ.
   GUITTARD, Chief Justice.

The lessor in a commercial lease brought this action against the lessee for a declaratory judgment construing a lease providing for monthly rentals based on a percentage of “gross sales.” The case was submitted on stipulations of fact to the trial judge, who held that the percentage rental should be computed after first deducting the mixed-beverage tax paid by a sublessee operating under a permit to sell mixed alcoholic beverages. The lessor appeals, contending that this tax should not be deducted from “gross sales” because it was part of the sublessee’s expense of doing business rather than a separate sales tax on the sublessee’s customers. We affirm on the ground that the mixed-beverage tax is an amount “collected and paid out for any sales as excise tax” within the specific exclusion from “gross sales” provided in the lease.

The relevant portions of the provision in question, with our emphasis of the crucial language, is as follows:

The term “gross sales" as used herein shall be construed to include the entire amount of the sales price, whether for cash or other wise, of ail sales of merchandise (including gift and merchandise certificates), services and other receipts whatsoever of all business conducted in or from the Demised Premises. Gross sales shall not include, however, any sums collected and paid out for any sales or excise tax imposed by any duly constituted governmental authority

Neither party contends that this language is ambiguous. Appellant seeks to distinguish the gross receipts tax imposed on holders of mixed beverage permits from the “limited sales tax” imposed on other retail sellers, and contends that the lease allows no deduction for the mixed-beverage tax as it does for the sales tax. The language of the two acts, however, is similar. The mixed-beverage tax is “imposed on the gross receipts of a permittee from the sale, preparation, or service of mixed beverages” by section 202.02 of the Texas Alcoholic Beverage Code (Vernon 1978). The “limited sales tax” is “imposed on the receipts from the sale at retail of all taxable items within this State” by article 20.02 of the Limited Sales, Excise and Use Tax Act, Tex.Tax. — Gen.Ann. art. 20.02 (Vernon Supp.1978). The Sales Tax Act further provides that the sales tax shall be added to the sale price and becomes a debt from the purchaser to the retailer which may be recovered in the same manner as the purchase price, and that the retailer is prohibited from advertising or representing that he will assume or absorb the tax. Tex.Tax.— Gen.Ann. art. 20.021 (Vernon 1969).

Lessor concedes that the mixed-beverage tax is an “excise tax,” but contends that it is not within the stipulated exclusion of “any sales or excise tax” because, unlike the sales tax, it is not “collected” from the customer and then “paid out” to the state. Consequently, lessor contends that the entire amount paid by the purchasers of mixed beverages to the sublessee is within the general definition of “gross sales” and is not a “sum collected and paid out for any sales or excise tax.” Thus, lessor argues, the mixed-beverage tax is not a tax on the consumer-purchaser of mixed alcoholic beverage, but is, instead, a business expense paid by a permittee for the privilege of selling mixed alcoholic beverages under Texas law.

This distinction, in our view, is not controlling. Both taxes are imposed by the statutes on “gross receipts.” As lessor concedes, the “limited sales tax” has no application to the sale of mixed alcoholic beverages, so that when one applies, the other does not. Like the sales tax, the mixed-beverage tax requires that an aggregate amount be collected from the customer and that a percentage then be paid over to the state. Whether the amount of the tax is computed as a percentage of the total amount paid by the customer, or by adding a percentage to the retail price, the result is substantially the same. The evident intent of the parties in agreeing to a percentage rental was to provide that the rental should be determined by the economic benefits to the lessee from doing business on the leased premises, as reflected by the gross sales of the lessee and any sublessee. Such benefits would not include any amounts collected by the lessee or a sublessee and paid over to the state as a tax measured directly by the amount of sales.

Any other interpretation would attribute to the parties an intention to fix the amount of the rentals according to a distinction which, however valid in law for other purposes, is irrelevant to the economic interests which the parties presumably had in mind in negotiating the lease. Consequently, we hold that the judge properly construed the lease as excluding the mixed-beverage tax paid by the sublessee from the amount of “gross sales” on which the percentage rental should be computed.

Affirmed.


author: McKAY, Justice.

text:
    SOUTHERN PACIFIC TRANSPORTATION CO., Appellant, v. Hubbard Stallworth BENDER, Appellee.
    No. 1208.
    Court of Civil Appeals of Texas, Tyler.
    May 17, 1979.
    Rehearing Denied June 14, 1979.

      Philip J. John, Jr., James E. Maloney, Baker & Botts, Houston, for appellant.
    James H. Brannon, Schmidt & Matthews, Houston, for appellee.
   McKAY, Justice.

Appellee brought this action against appellant under the Federal Employers’ Liability Act to recover damages for personal injuries sustained in an accident while he was working as an employee for the appellant. Appellee sustained injury when he jumped from a railroad car which was derailing at the Englewood Yard in Harris County, Texas. Trial was to a jury, and the jury found that the railroad had negligently failed to inspect a particular switch and that such failure to inspect was a proximate cause of appellee’s injury. The jury found further that the railroad had not failed to provide appellee with a reasonably safe place to work, and also found that appellant had not failed to provide appellee with safe equipment with which to work. Based upon these answers to special issues the trial court entered judgment for appellee in the amount of $300,000.00.

Appellee was employed by the railroad as a switchman, and his responsibility included primarily positioning railroad cars and assembling and disassembling trains at the Englewood Yard. On the occasion in question appellee and three other crew members assembled eleven 85-foot flatbed railroad cars which were in the process of being pushed to their desired positions by switch engines. Appellee and two crew members were riding on the front, or lead railroad car, and one crew member, the engineer, operated the engine located at the back of the line. As the cars were being pushed along one track that intersected with the switch known as North No. 6 Switch, the front wheels, or trucks, of the first car crossed the switch and properly proceeded along one track. When the rear trucks crossed the No. 6 switch, however, those trucks did not follow on the same tracks as the front trucks, but rather began traveling along another track. Such opposing movements along two different tracks caused the rear trucks of the lead railroad car to derail. Appellee advised the engineer to stop the cars and then he and one crew member jumped from the railroad car, and appellee landed on a hard surface and was injured.

Thereafter appellee brought suit against the railroad alleging that he had sustained injuries and alleged that the railroad was liable for his injuries: (1) in failing to provide [him] with a reasonably safe place in which to work; and (2) in failing to provide [him] with reasonably safe equipment with which to work. The court submitted the following issues one and two to the jury:

“SPECIAL ISSUE NO. 1
“Do you find from a preponderance of the evidence that on or before the occasion in question, the Southern Pacific Transportation Company, acting through its officers or employees other than Plaintiff Hubbard Bender, was negligent with respect to (a) not properly inspecting the switch; (b) not properly repairing the switch; (c) not replacing the switch; (d) disconnecting the train line brakes; (e) not applying the brakes in time; (f) not providing an effective communications system for this crew?
“Answer ‘Yes’ or ‘No’ on each line in Column 1. If any of your answers in Column 1 are ‘yes’ then state whether you find from a preponderance of the evidence that any such negligence was a proximate cause of the occurrence in question. Answer ‘Yes’ or ‘No’ on the corresponding lines of Column 2.

Column 1 Column 2 Negligent Proximate Cause

“(a) Not properly inspecting the switch ‘Yes’ ‘Yes’
“(h) Not properly repairing the switch ‘No’ _
“(c) Not replacing the switch ‘No’
“(d) Disconnecting the train line brakes ‘No’ _
“(e) Not applying the brakes in time ‘No’ _
“(f) Not providing an effective communications system for this crew ‘No’ _
“SPECIAL ISSUE NO. 2
“Do you find from a preponderance of the evidence that on the occasion in question, the Southern Pacific Transportation Company, acting through its officers or employees other than Plaintiff Hubbard Bender, failed to furnish Hubbard Bender (a) a reasonably safe place in which to work or (b) reasonably safe equipment with which to work?
“Answer ‘Yes’ or ‘No’ on each line in Column 1. If any of your answers in Column 1 are ‘Yes’ then state whether you find from a preponderance of the evidence that any such failure to furnish was a proximate cause of the occurrence in question? Answer ‘Yes’ or ‘No’ on the corresponding lines of Column 2.
Column 1 Column 2 Failure to Proximate Furnish CaUvSe
“(a) Place to work ‘No* _
"(b) Equipment ‘No* _
“You are instructed by the Court that a railroad owes a continuing nondelegable duty to its employees to provide them with a reasonably safe place in which to work. You are instructed that the term ‘reasonably safe place in which to work’ as used herein, is meant such a place from a standpoint of safety to employees as would be furnished by an ordinary prudent railroad in the exercise of ordinary care to its employees under the same or similar circumstances.
“You are further instructed by the Court that a railroad owes a continuing non-delegable duty to its employees to provide them with reasonably safe equipment with which to work in performing their duties. You are instructed that the term ‘reasonably safe equipment’ as used herein, is meant such equipment from a standpoint of safety to employees as would be furnished by an ordinary prudent railroad in the exercise of ordinary care to its employees under the same or similar circumstances.”

Appellant brings five points of error all of which are based upon the proposition that the answers to the special issues by the jury are in irreconcilable conflict. Appellant cites two F.E.L.A. cases (45 U.S.C.A. Sec. 51, et seq.) and relies on them in this appeal. The first case is Arnold v. Panhandle & S. F. Railway Co., 353 U.S. 360, 77 S.Ct. 840, 1 L.Ed.2d 889 (1957); this is a Texas case reported in 283 S.W.2d 303 (Tex. Civ.App.—Amarillo 1955, writ ref’d n. r. e.). In that case the jury acquitted the railroad on specific acts of negligence but found that the railroad had not furnished Arnold a reasonably safe place in which to work. The Supreme Court of the United States held that the answers were not in conflict for the reason that the specific findings were not exhaustive or all inclusive of the acts which might have constituted negligence, whereas the finding on an unsafe place to work was exhaustive and all encompassing. Stated another way, the unsafe-place-to-work negligence may have resulted from an act not named or included among the specific acts submitted.

The second case appellant relies on is Missouri-Kansas-Texas RR. Co. v. Shelton, 383 S.W.2d 842 (Tex.Civ.App.-Dallas 1964, writ ref’d n. r. e.), cert. denied, 382 U.S. 845, 86 S.Ct. 54, 15 L.Ed.2d 85 (1965). Shelton presents the reverse of the situation in Arnold. In Shelton the jury answered no to an inquiry whether the railroad failed to furnish appellee a reasonably safe place to work, but the jury also found that the railroad was negligent in permitting chatt, gravel, rocks, mounds of dirt, or debris to remain in the area where the employee alighted from the caboose. The court said at p. 847:

“. . . Since the safe-place-to-work finding is exhaustive and all-encompassing it cannot be reconciled with the finding in regard to chatt, gravel, etc. The Arnold case is really authority for holding that the answers here are in conflict.
“As we view the situation the rule relied on by appellee is not applicable here. In answering Special Issue No. 2 ‘No’ the jury in effect found that appellee had not discharged his burden of showing that appellant had furnished appellee an unsafe place in which to work. In answering Special Issue No. 9 ‘Yes’ the jury in effect found that appellee had discharged his burden of showing that appellant had furnished appellee an unsafe place in which to work. Both answers cannot be correct. We think the test quoted in Pearson v. Doherty, 143 Tex. 64, 183 S.W.2d 453, (Syl. 2) is applicable here. The two findings are in conflict. We sustain appellant’s Point No. 5.” [Emphasis added.]

Appellee contends that there is a distinction between Shelton and the instant case because of explanatory instructions given by the court in Shelton which were not given here. In Shelton a portion of the instruction to the jury under the safe-place-to-work issue was:

“You are further instructed that the duty to exercise ordinary care to furnish a safe place to work does not have reference only to the physical condition of the place itself but also has reference to the negligent acts, if any, you find of the defendant’s employees on the occasion in question.” [Emphasis added.]

The issue (no. 2) in the case at bar inquired, “Do you find . . . that on the occasion in question, [the railroad], acting through its officers or employees other than Plaintiff . . . failed to furnish Hubbard Bender (a) a reasonably safe place in which to work or (b) reasonably safe equipment with which to work?” [Emphasis added.]

Appellee argues that Shelton had the vice of including the specific acts of negligence in the general issue of safe place to work, and it was this reference to negligent acts in the instruction that created the conflict in Shelton. We disagree. When the trial court here included in Issue 2 “acting through its officers and employees” the same effect was accomplished as if the language of the Shelton instruction had been given.

Appellee also argues that if there is a conflict in the jury verdict it can be reconciled. The basis of appellee’s argument is that the furnishing of reasonably safe equipment took place at one point in time and the failure to inspect the switch took place at another point in time, because one witness testified that approximately six years prior to the accident involved here the appellant discontinued the maintenance practice of checking and oiling the switches on a full-time basis. We recognize that the trial court has the duty to reconcile apparent conflicts in the jury’s findings if it can be reasonably done considering the pleadings and the evidence. Ford v. Carpenter, 147 Tex. 447, 216 S.W.2d 558, 562 (1949), but we do not agree that such testimony would be sufficient to reconcile a Shelton -type conflict as we have here.

The rule which should be followed in determining whether there is a fatal and irreconcilable conflict in the jury findings is set out in Little Rock Furniture Mfg. Co. v. Dunn, 148 Tex. 197, 222 S.W.2d 985, 991 (1949):

“. . .To require a judgment entered on a verdict containing conflicting answers to be set aside, the conflict between the answers must be such that one answer would establish a cause of action or defense, while the other would destroy it. In Pearson v. Doherty, 143 Tex. 64, 70, 183 S.W.2d 453, 456, the court quotes with approval as the test in cases of this kind from the opinion in Howard v. Howard, Tex.Civ.App., 102 S.W.2d 473, 475, writ refused, as follows: ‘The test in such [а] case is, whether taking the finding alone in the one instance, a judgment should be entered in favor of the plaintiff; and taking it alone in the other, judgment should be entered in favor of the defendant.’ ”

In applying the rule we must consider the answers claimed to be in conflict, disregarding the alleged conflicting answer but taking into consideration all the rest of the verdict, and if so considered, one of the answers would require a judgment in favor of the plaintiff and the other would require a judgment in favor of the defendant, then the answers are fatally in conflict. Little Rock Furniture Mfg. Co. v. Dunn, supra; Bradford v. Arhelger, 161 Tex. 427, 340 S.W.2d 772, 773 (1960); Bay Petroleum Corp. v. Crumpler, 372 S.W.2d 318, 319 (Tex.1963); 3 McDonald, Texas Civil Practice, Section 15.06.7.

By considering the answer to issue no. 1 and disregarding the answer to issue no. 2, a judgment in favor of appellee would be required; by considering the answer to issue no. 2 and disregarding issue no. 1, a judgment would be required in favor of appellant. We conclude there is a fatal conflict in the jury findings which cannot be reconciled. This result follows when the conflict is between answers to a general issue and to a specific issue necessarily included within the general. 3 McDonald, Texas Civil Practice, Section 15.06.7; Missouri-Kansas-Texas RR. Co. v. Shelton, supra; Bell Cab Co. v. Vasquez, 434 S.W.2d 714, 719 (Tex.Civ.App.—San Antonio 1968, writ ref’d n. r. e.). If the two issues are of equal dignity and magnitude the jury’s answers would remain in irreconcilable and fatal conflict because there are inconsistent findings to the same question. The court said in Pearson v. Doherty, 143 Tex. 64, 183 S.W.2d 453, 455 (1944): “The rule is that there is no priority of findings, either in degree or importance, and where two findings with respect to a material fact are such that both cannot be true, then neither can stand.”

It is noted that appellee’s pleading alleged only that appellant was negligent in (1) failing to provide a reasonably safe place in which to work; and (2) in failing to provide reasonably safe equipment with which to work. It is also noted that there is no objection by appellant in the record to the giving of the specific negligence issues by the trial court.

We are not unmindful of cases by Texas courts which hold that a specific finding of negligence in a special issue controls over a general finding of negligence; however, this being an F.E.L.A. case, we do not consider those holdings applicable here. Arnold v. Panhandle & S. F. Railway Co., supra; Missouri-Kansas-Texas RR. Co. v. Shelton, supra at p. 850-1; Texas & New Orleans Railroad Co. v. Arnold, 381 S.W.2d 388, 392 (Tex.Civ.App.—Beaumont 1964), appeal dismissed, 388 S.W.2d 181 (Tex.1965).

The judgment of the trial court is reversed, and the cause is remanded to that court.


author: WALLACE, Justice.

text:
    COMPUTER SYNERGY CORPORATION, Appellant, v. BUSINESS SYSTEMS PRODUCTS, INC., Appellee.
    No. 17410.
    Court of Civil Appeals of Texas, Houston (1st Dist.).
    May 17, 1979.

      Dickerson & Davis, Van Thompson, Jr., Karl A. Maley, Houston, for appellant.
    Richie & Greenberg, Philip P. Sudan, Jr., Houston, for appellee.
    Before WALLACE, EVANS and WARREN, JJ.
   WALLACE, Justice.

This is an appeal from an order of the trial court which granted the special appearance of appellee, and severed and dismissed appellant’s cause of action against appellee.

Appellant Computer Synergy Corporation, plaintiff below, is a Texas corporation whose principal place of business is Houston, Texas. Appellee Business Systems Products, Inc., is a foreign corporation whose principal place of business is Irvine, California. Other defendants in the suit, but not parties to this appeal, are K.R.S., Inc. and Stephen L. Sawyer.

On November 23, 1977, in Irvine, California, appellee entered into a dealer agreement with Richard J. Peely. The agreement provided that it would be assigned to a corporation to be formed by Feely. That corporation was formed and is the appellant, Computer Synergy Corporation. The agreement grants to appellant as exclusive sales territories areas of Houston and Dallas-Port Worth, Texas.

Pursuant to the dealer agreement appel-lee shipped merchandise to appellant in Texas, F.O.B. Irvine, California. Appellee also made payments to appellant in the total amount of approximately $10,000.00. There were contacts between appellant and appellee by mail and telephone.

Stephen L. Sawyer is president of K.R.S., Inc. On April 18, 1978, appellant entered into a sales contract with K.R.S., Inc. The contract granted K.R.S., Inc., a right to sell the merchandise of appellee in the sales territories granted to appellant in the November dealer agreement between appellee and appellant.

Sawyer sold a computer to Mort Hall Ford, Inc., of Houston on September 19, 1978. A down payment of $21,000.00 was made to appellant. On September 26, 1978, the sales contract between K.R.S. and appellant was terminated by mutual agreement.

In mid-October Mr. Lilley, the secretary of Mort Hall Ford, Inc., the person who had contracted for the purchase of the computer, accompanied Mr. Sawyer to the office of appellee in Irvine, California. The reason for the trip was, as testified by Mr. Lilley, “. . .to find out who was telling me lies and who wasn’t.” Mr. Lilley learned that the order had not been placed with appellee by appellant for the computer in question. Mr. Lilley, after ascertaining that appellant would be paid their commission on the sale, ordered directly from ap-pellee the computer he had previously contracted to buy from appellant. The board of directors of Mort Hall Ford, Inc., subsequently refused to ratify the order and it was cancelled.

On November 2, 1978 this suit was filed. Appellant seeks damages for interference with existing contracts and for injunctive relief. Service was had on appellee under Article 2031b, V.T.C.S. Appellee filed a special appearance which was granted by the trial court.

The sole issue on appeal is whether or not appellee has had sufficient minimum contacts in Texas to satisfy the due process requirement of the 14th Amendment of the United States Constitution so as to be amenable to in personam jurisdiction.

The allegations in appellant’s petition were sufficient to assert long-arm jurisdiction under Article 2031b, V.T.C.S. The alleged contacts constituting “doing business” in the State of Texas were: (1) a written contract entered into with a resident of Texas and performable in whole or in part in Texas; (2) the commission of a tort (illegal interference with a contract) in whole or in part in Texas.

Appellee had the burden of establishing that it was not amenable to the long-arm process. Scott v. Scott, 554 S.W.2d 274 (Tex.Civ.App.-Houston [1st Dist.] 1977, no writ); Gathers v. Walpace Co., Inc., 544 S.W.2d 169 (Tex.Civ.App.-Beaumont, 1976, writ ref’d n. r. e.). The basic criteria necessary to acquire jurisdiction under Article 2031b, V.T.C.S. are enunciated in O’Brien v. Lanpar Company, 399 S.W.2d 340 (Tex.1966):

(1) “The non-resident defendant or foreign corporation must purposefully do some act or consummate some transaction in the forum state;
(2) The cause of action must arise from, or be connected with, such act or transaction; and
(3) The assumption of jurisdiction by the forum state must not offend traditional notions of fair play and substantial justice, consideration being given to the quality, nature, and extent of the activity in the forum state, the relative convenience of the parties, the benefits and protections of the laws of the forum state afforded the respective parties, and the basic equities of the situation.”

This three part test is a synthesis of the three leading United States Supreme Court eases dealing with in personam jurisdiction: International Shoe Company v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945); McGee v. International Life Ins. Company, 355 U.S. 220, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957); and Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958).

The factors to be considered in determining whether or not there have been sufficient contacts with the forum state are set out in Sun-X International Co. v. Witt, 413 S.W.2d 761 (Tex.Civ.App.-Texarkana 1967, writ ref d n. r. e.); Trinity Steel Company, Inc., v. Modern Gas Sales & Service Company, 392 S.W.2d 861 (Tex.Civ.App.-1965, writ ref’d n. r. e.). These factors are:

“(1) the nature and character of the business;
(2) the number and type of activities within the forum state;
(3) whether such activities give rise to the cause of action;
(4) whether the forum state has some special interest in granting relief; and
(5) the relative convenience of the parties.”

The judgment which appellant seeks to have reviewed resulted from a full hearing before the trial judge. No findings of fact and conclusions of law were filed and the record, therefore, must be viewed in its most favorable light to support the judgment. Trinity Steel Company, Inc. v. Modern Gas Sales & Service Co., Inc., supra.

We have noted that appellee is a California corporation with its principal place of business in Irvine, California. The contract relied upon by appellant was negotiated and executed in California by California residents. The contract did anticipate that appellant would perform acts in Texas. Appellee shipped merchandise to appellant F.O.B. Irvine, California. Title to the merchandise thus passed to appellant once conforming goods were placed in the hands of the carrier. Tex.Bus. & Comm. Code Ann. § 2.319, Uniform Commercial Code § 2-319.13 (2d Ed.1970). Appellee paid to appellant approximately $10,000.00 over the period of their contract. Appellee had contact with appellant by mail and telephone. The acts were sufficient to bring appellee within the literal reach of Article 2031b, V.T.C.S.

We must now examine the record to determine if appellee has had sufficient contacts with the State of Texas to satisfy the due process requirements of the 14th Amendment.

The contract required appellee to make shipments to appellant in Texas. These shipments were F.O.B. Irvine, California, thus the title to merchandise passed to appellant upon being delivered to the carrier. Tex.Bus. & Comm.Code Ann. § 2.319; Uniform Commercial Code § 2-319.13 (2d Ed.1970). These transactions did not give rise to the instant case. Appellee made payments to appellant by mail in Texas. A contract which is partially performable in Texas by reason of a contractual obligation to make payments within the forum is not enough to sustain the minimum contact’s requirement. U-Anchor Advertising Company, Inc. v. Burt, 553 S.W.2d 760 (Tex.1970).

The record shows that no employee, officer or agent of appellee was ever present in Texas prior to the filing of this suit.

The Mort Hall Ford transaction was negotiated in California and was precipitated by Mr. Lilley of Mort Hall Ford, Inc., not by appellee. The transaction was never consummated, therefore, it does not constitute “minimum contacts” as contemplated by Article 2031b. Amco Transworld, Inc. v. Bambi, 257 F.Supp. 215 (S.D.Tex.1966). Considering traditional notions of fair play and substantial justice, and in light of the quality, nature and extent of activity in Texas, we find that the trial court was within its sound discretion in entering the order complained of.

The order of the trial court is affirmed.


author: KEITH, Justice.

text:
    Jim Bill WILLIAMS, et ux, Appellants, v. T. R. BENNETT, Appellee.
    No. 8260.
    Court of Civil Appeals of Texas, Beaumont.
    May 17, 1979.
    Rehearing Denied June 7, 1979.
    Mike Gallagher, Houston, for appellants.
    Ralph Zeleskey, Lufkin, for appellee.
   KEITH, Justice.

Plaintiffs below appeal from a judgment non obstante veredicto entered in a jury trial on a medical malpractice suit, concerning the alleged wrongful discharge of Janette Williams from Memorial Hospital in Lufkin, Texas, and the alleged subsequent abandonment by defendant, Dr. T. R. Bennett.

Janette Williams was admitted to the hospital, where defendant performed a hysterectomy on her on December 17, 1974. Subsequently, she developed a spiking fever. It was obvious to defendant that plaintiff had an infection, but he was unable to find it. However, he treated her with several types of antibiotics. On December 24, defendant removed the bandage from plaintiff’s incision, removed several of her sutures, and discovered that she had a subcutaneous abscess — a large amount of pus discharged from her incision. He removed half of her sutures and let the abscess drain. He continued her on antibiotics and changed them until she responded to one and her temperature returned to within normal limits. He had taken cultures of the pus that came from the incision. On December 31, defendant decided to release plaintiff from the hospital — her temperature was normal and as of that date the cultures contained no growth. He told her to return to his office the next week for the removal of her other sutures. He did not give her any medication, either antibiotics or pain medication.

On January 1, 1975, the hospital lab sent a report on plaintiff’s cultures to defendant; they contained a “rare microaerophilic gamma streptococci”. Defendant testified that the term “rare” meant that the lab saw very few of these organisms growing, i. e., “[o]ne or two organisms per microscopic field”, as opposed to the streptococci strain itself being unusual. Defendant never informed plaintiff of this report.

Plaintiff was to return to defendant’s office on January 6 for the removal of her sutures, but a member of her family can-celled her appointment because of severely cold and rainy weather. On January 7, she went to her family doctor, Dr. Burch, because defendant was on vacation. Dr. Burch removed her remaining sutures and prescribed antibiotics and pain medication.

On January 10, plaintiff went to the emergency room at Woodland Heights Hospital in Lufkin, Texas, where she was treated by Dr. William Mitchell, who was “on call” for defendant. This doctor broke open several infectious abscesses at her incisional site and prescribed both pain medication and antibiotics to combat her infection.

For approximately forty-five days from the date of her discharge, plaintiff was in intense pain. But, she never returned to defendant’s office. His receptionist and nurse tried to contact her, but no one answered the telephone. No one informed them that the phone was out-of-order. Several appointments were made on behalf of plaintiff with defendant’s office, but they were either cancelled or she did not show for them. In the latter part of January, defendant had his secretary send her a letter to call the office and set up a post-operative examination. She called and made an appointment for January 28 but did not show for it. At trial, Mrs. Williams admitted that she never contacted defendant after her hospital dismissal because “I didn’t want him to doctor me.”

Plaintiff and her husband filed suit against defendant for wrongful discharge and abandonment. At trial, the jury found that defendant had discharged plaintiff from the hospital at a time when a reasonably prudent physician from the same or similar community acting under the same or similar circumstances in the exercise of ordinary care would not have done so (Special Issue No. 1); that such discharge was a proximate cause of her injuries (Special Issue No. 2); and that because of said discharge, she should receive damages in the amount of $20,000 for her past physical pain and mental anguish, $1,500 for the loss of her household services in the past, and $2,700 for the loss of her capacity to perform household services which, in reasonable probability, would be sustained in the future. The jury failed to find that defendant had abandoned plaintiff (Special Issue No. 3) and, consequently, did not have to reach Special Issue No. 4 on proximate cause. Defendant moved for a judgment non obstante veredicto, which the court granted on the ground that there was no evidence to support the jury’s affirmative answer to Special Issue No. 1.

Plaintiffs appeal this judgment on two points of error. First, plaintiffs complain that the court erred in granting a judgment non obstante veredicto because the record contained ample evidence to support the jury’s affirmative answer to Special Issue No. 1.

To sustain the action of a trial court in granting a motion for a judgment non obstante veredicto, we must find that there is no evidence upon which the jury could have made the findings relied upon. Therefore, we must consider the evidence in the light most favorable to the party against whom the motion is sought and every reasonable intendment deducible from the evidence is indulged in that party’s favor. Douglass v. Panama, Inc., 504 S.W.2d 776, 777 (Tex.1974).

It is well-settled Texas law that a patient has no cause of action against his doctor for malpractice, either in diagnosis or treatment, unless he proves by a doctor of the same school of practice as the defendant that the diagnosis or treatment complained of was negligence and that it was a proximate cause of the patient’s injuries. Hart v. Van Zandt, 399 S.W.2d 791, 797 (Tex.1965); Bowles v. Bourdon, 148 Tex. 1, 219 S.W.2d 779, 782 (1949); Smith v. Guthrie, 557 S.W.2d 163, 165 (Tex.Civ.App.—Fort Worth 1977, writ ref’d n. r. e.). This standard of care may be proven by the testimony of a doctor-defendant. Wilson v. Scott, 412 S.W.2d 299, 303 (Tex.1967); Smith v. Guthrie, supra; Gaut v. Quast, 505 S.W.2d 367, 369 (Tex.Civ.App.—Houston [14th Dist.]), writ ref’d n. r. e. per curiam, 510 S.W.2d 90 (Tex.1974).

Plaintiffs did not call any medical experts to testify, other than defendant. They contend that his testimony proved the standard of care he was required to use and that he failed to meet that standard. We disagree.

Defendant testified that it was bad medical practice to discharge a person from the hospital during a virulent infectious process. He further testified that it would not be in keeping with the standard of medical practice in his community to discharge a patient if she had a virulent infection and did not show other signs of responding to medical treatment.

Defendant’s testimony did not establish that he failed to meet the standards to which he had testified. There is no proof that plaintiff had a virulent infection when she left the hospital. The January 1 lab report only showed that on December 25 she had such an infection. By December 31, plaintiff was recuperating normally according to defendant’s discharge summary—she had no temperature, her bowel movements had resumed, she was eating, and she was ambulatory. Defendant consistently maintained throughout his entire testimony that plaintiff did not have an active infection on December 31 and that the abscess was sterile. He testified that based upon the medical standards of his community, it was his opinion that plaintiff was ready for discharge on December 31. Plaintiffs have presented us with no expert evidence to the contrary. There is no evidence to prove that the infection which she had on January 10 was related to her previous infection. Therefore, point of error one is overruled.

In their second point of error, plaintiffs complain that the jury’s answer to the special issues on abandonment is against the great weight and preponderance of the evidence. We disagree.

The jury was instructed in the following manner:

“[T]he term ‘abandonment’ means the severance of the physician/patient relationship without reasonable and actual notice of the physician’s intent to sever such a relationship at a time when there is a necessity for continuing medical care or alternatively the failure to provide for adequate medical attention in the event of the physician’s unavailability at a time when there is a necessity for continuing medical care.”

The jury was further instructed that “there can be no abandonment of a patient by a physician when the patient has voluntarily chosen not to return to his or her physician, or has discharged or dismissed his or her physician.” See Lee v. Dewbre, 362 S.W.2d 900, 902 (Tex.Civ.App.-Amarillo 1962, no writ); Hernandez v. Smith, 552 F.2d 142, 146-47 n. 7 (5th Cir. 1977). See also Per-due, “The Law of Medical Malpractice—The Cause of Action”, 11 Hous.L.Rev. 1, 12—13 (1973).

Having reviewed the entire record [Garza v. Alviar, 395 S.W.2d 821, 823 (Tex.1965)], we find that the jury’s answer was not against the great weight and preponderance of the evidence. It appears that there was a severance of the physician/patient relationship between Mrs. Williams and defendant, but it was caused by Mrs. Williams, not defendant, who voluntarily chose not to return to defendant. Point of error two is overruled.

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

AFFIRMED.