author: GUITTARD, Chief Justice.

text:
    TEXAS BANK & TRUST COMPANY, Appellant, v. CAMPBELL BROTHERS, INC., et al., Appellees.
    No. 19489.
    Court of Civil Appeals of Texas, Dallas.
    May 31, 1978.
    Rehearing Denied June 29, 1978.

      W. Ted Minick, Winstead, McGuire, Se-chrest & Trimble, Dallas, for appellant.
    Jim E. Cowles, R. Brent Cooper, Touchstone, Bernays & Johnson, Sam S. Stollen-werck, Thomas K. Boone, Dalton, Moore, Forde, Joiner & Stollenwerck, Lynn Phillips, Dallas, for appellees.
   GUITTARD, Chief Justice.

This suit arose out of a contract for construction of an apartment project. The contractor, Campbell Brothers, Inc., stopped the work because of failure of the owner, San Mateo Properties, Inc., to make a progress payment pursuant to an application for payment presented by the contractor. The contractor sued the owner for the amount alleged to be due and also for damages for breach of contract, and joined as a defendant Texas Bank & Trust Company, alleging that the contractor had a lien superior to the deed of trust securing the bank’s construction loan. The owner and the bank counterclaimed against the contractor and the surety on the contractor’s performance bond, alleging breach by the contractor in failing to complete the contract and damages consisting of the excess of the cost of completion over the contract price. The jury’s answers to special issues were favorable to the contractor and the surety. From a judgment on this verdict, only the bank has appealed.

We hold that recovery by the owner and the bank was properly denied because the evidence supports the jury’s finding that the owner had failed to make payments as required by the contract when the contractor left the job, and the bank, as a co-obli-gee on the contractor’s performance bond, has no independent right to demand performance without payment of the amount due. We hold also that the trial court properly determined the contractor’s statutory lien to be superior because the evidence supports the jury finding that the contractor had commenced visible construction of the project before the bank recorded its deed of trust. In response to the contractor’s cross-point, we hold that the trial court properly declined to include in the amount secured by the contractor’s lien the contractor’s lost profit on work not performed. Accordingly, we affirm the judgment of the trial court in all respects.

1. Owner’s Claim for Breach of Contract

Although the owner has not appealed, we consider first the owner’s claim for breach of contract, since the bank’s position depends on the owner’s claim in some respects. For this purpose, we temporarily defer the bank’s claim that it has established grounds of recovery not available to the owner.

The contract sued on provides for reimbursement of the contractor’s costs plus a fixed fee, with an overall limit of $2,636,-738. The owner is required to reimburse the contractor for costs as the work progresses on applications for payment submitted by the contractor. The contractor stopped the work on December 2, 1974, after the owner failed to pay the amount the contractor claimed to be due on application number 29, presented on November 1,1974.

In asserting a breach by the contractor, the bank attacks the jury’s answer to special issue number 15, by which the jury found that at the time the contractor terminated the work, the owner had failed to pay for work done or materials furnished under the contract contained in application for payment number 29. The bank contends that this finding has no support in the evidence, and, in the alternative, that it is contrary to the great weight and preponderance of the evidence, in that the evidence shows that no money was due from the owner because the contractor had earlier charged to the job more than $53,000 of work that was not within the scope of the contract.

Application number 29 states the amount of work “completed and stored to date” to be $2,091,746, and since the contractor admitted receiving payments aggregating $2,038,238, the indicated balance due would be $53,508. The bank argues that nothing was due to the contractor when it left the job because the work “completed and stored to date” was overstated by more than the amount of this balance. According to the bank, the following items are shown by the undisputed evidence to have been improperly included:

(1) $17,774 for work done on the site before the contract work began;
(2) $17,680 for a bond premium not included in the contract amount;
(3) $2,205 for a building permit not included in the contract amount;
(4) $36,067 for work done on the residence of George Jones, sole stockholder of the corporate owner, San Mateo Properties, Inc.

The aggregate amount of these claimed reductions is $73,726. The bank says that none of these items actually appeared in application number 29, but that the amounts were concealed within this application under the amounts stated for other items of work shown to have been done under the contract.

The contractor responds that there was no fraud or deception because all of the items in question were known and understood by the owner and all were sums legitimately due. The contractor insists that it had actually paid out the amounts in question for site work, bond premium, and building permit, and that all were properly charged against the owner. The contractor further asserts that it had actually done work on the Jones residence to the extent of $36,067, and that payments in this amount, as well as payments for the other items in question, had previously been credited to the owner and had been included in the total payments of $2,038,238, which the contractor had received. Thus, the contractor argues that it was entitled to apply the previous payments received to those disputed items rather than to amounts due strictly within the terms of the contract and that it was entitled to stop the work until payment of the balance was received. Moreover, the contractor asserts, there was no dispute concerning the work actually done in the period for which application number 29 was submitted. Consequently, it argues that neither the owner nor the bank could properly withhold payment for this work on the ground that previous payments, which had been credited by the contractor to other legitimate claims, were not applied to the amounts due under the contract in question.

With respect to the work done on the Jones residence, there is at least a dispute in the evidence as to whether any proceeds of the bank’s loan were used for that purpose. Jones testified that he paid approximately $79,000 of his own funds to the contractor in September, October and November of 1974. Thus, it would have been reasonable for the jury to conclude that although various applications for payment included work on the residence as well as on the apartment project, the bank was not prejudiced because the amount of the residence work so chárged was more than offset by payment from Jones’ personal funds.

The owner’s obligation to make progress payments and the contractor’s right to stop the work if such payments are not made depend on the provisions of the contract documents. Article 14 of the contract provides:

The Contractor shall, at least ten days before each progress payment falls due, deliver to the Architect a statement, sworn to if required, showing in complete detail all moneys paid out or costs incurred by him on account of the Cost of the Work during the previous month for which he is to be reimbursed under Article 6 and the amount of the Contractor’s fee due as provided in Article 7, together with payrolls for all labor and all receipted bills for which payment has been received.

Article 15.1 provides further:

The Architect and/or Owner will review the Contractor’s statement of moneys due as provided in Article 14 and will promptly issue a Certificate for Payment to the lender for such amount as he approves, which Certificate shall be payable on or about the 10th and 25th day of the month.

The contract refers to and incorporates printed “general conditions,” of which paragraph 9.6.1 provides as follows:

[I]f the Owner should fail to pay the Contractor within seven days after the date of payment established in the Agreement any amount certified by the Architect or awarded by arbitration, then the Contractor may, upon seven additional days’ written notice tb the Owner and the Architect, stop the Work until payment of the amount owing has been received.

The undisputed evidence shows that no architect was employed to examine and certify applications for payment and that the amounts requested in previous applications had been paid on the approval of Jones. Application number 29 was also approved by Jones with an adjustment of $1,873. It is dated November 1,1974, and covers work for the period from October 16 to November 1.

On November 22, 1974, the contractor delivered a letter to Jones stating that $50,-017 was past due on the San Mateo Apartment project and that if this amount were not paid within seven days, the contractor would be forced to stop the work. Copies of this letter were delivered to the bank and the surety. The contractor’s president, Eugene Campbell, testified that the last day of work on the project was November 27, the day before Thanksgiving day, and that no work could be done on the following Friday because of the holiday. Consequently, the first day that work was actually left undone was the following Monday, December 2, more than seven days after the notice was delivered.

It is undisputed that no payment was made after the letter was delivered on November 22. The bank refused to advance any more funds on the stated ground that the contractor was “getting a little heavy” in its applications for payment. This statement was taken to mean that the contractor’s billings exceeded the work actually completed.

We conclude that the evidence thus summarized is sufficient to support the jury’s finding in answer to special issue number 15 that at the time the contractor terminated the work, the owner had failed to pay for the work done or materials furnished under the contract contained in application number 29. This application was a request for payment for work completed in the period from October 16 to November 1. The evidence shows without dispute that none of the labor or materials listed for that period was for costs incurred outside the contract. It is also undisputed that on December 2, when the contractor discontinued the work, at least the $50,017 stated in the contractor’s letter of November 22 was past due and owing to the contractor, if only the work covered by the period of application no. 29 is considered.

The owner is in no position to say that the amount of contract work shown on the application to have been “completed and stored” was overstated because Jones, who handled all of the transactions for the owner, well knew that this figure included costs incurred by the contractor outside the terms of the contract, and that payments had been made to cover these costs. The contractor and the owner were privileged, between themselves, to handle all statements and payments out of the single account in the name of the apartment project, and they were also privileged to apply some of the payments to items legitimately due, but not covered by the contract, particularly since those payments were more than offset by payments out of Jones’ own funds.

If application number 29 is adjusted, as the bank says it should be, by reducing the “total completed and stored to date” to the extent of these non-contract items, then, as between the owner and the contractor, the payments received by the contractor must also be adjusted so as to credit Jones with payment of those items in view of his testimony that he had paid more than that amount out of his personal funds. These adjustments would offset each other, leaving a balance due the contractor on application number 29 of at least the amount claimed in the notice of November 22.

Jones, acting in lieu of a supervising architect, had approved previous applications which included the non-contract work in the amounts shown as completed and stored, and had also approved the amount claimed under application number 29 as completed and stored. In view of this repeated cumulative approval of the inclusion of non-contract work in prior applications, the owner may not now say that payments under prior applications should not have been credited to the amounts due for the work on Jones’ residence. Neither is the owner in a position to assert that payments that had been applied to amounts due for the site work, the bond premium, and the building permit fee should not have been so applied to those items, which were legitimate expenses of the apartment project, even though they may not have been included in the contractor’s reimbursable costs under the terms of the contract.

If the owner had taken the position when it received the notice of November 22 that all of its payments should have been credited to the contractor’s reimbursable costs under the contract and none to those items outside the contract, and had demanded that adjustments be made so that the contractor’s claimed balance of $50,017 should be considered paid and that the items outside the contract should be considered unpaid, the contractor would have been justified in responding that under the terms of the contract Jones’ approval of the previous applications was binding on the owner. Having failed to demand such an adjustment at that time, the owner is in an even poorer position to make such a demand after approving application number 29, but failing to pay the amount shown by that application to be due, particularly after the contractor had stopped the work because of such failure.

The bank contends in the alternative that the notice given on November 22 was premature because payment was not due until November 25. It argues that since the payment dates specified in article 15.1 of the contract are the 10th and 25th of each month, and since article 14 requires that the applications for payment be submitted “at least ten days before each progress payment falls due,” and November 10 was only nine days after application number 29 was presented on November 1, the next progress payment date was November 25. Accordingly, the bank asserts the contractor was required to wait until seven days after November 25 before giving the notice and then another seven days until December 9 before stopping the work.

We conclude that the contract is not reasonably subject to the construction that the contractor was required to continue working as long as five weeks before receiving payment on application number 29. Such a construction ignores the words “on or about” in article 15.1. By the express provision of that article, the payment dates are “on or about” the tenth and twenty-fifth days of each month. When application number 29 was presented on November 1, the next day “on or about” the tenth or twenty-fifth of the month, allowing ten days after presentation of the application, was November 11. Under paragraph 9.6.1 of the general conditions, the contractor was authorized to give the notice seven days after that date, on November 18, but the notice was not given until November 22. Accordingly, the notice was timely, and when the work was discontinued on December 2, the seven additional days had also expired without payment of the amount due. Consequently, the contractor was not guilty of a breach of contract by stopping the work on that date.

2. Bank’s Claim for Breach of Contract

So far, we have considered only whether there was a breach of contract as between the contractor and the owner. We turn now to the bank’s contention that it has established an independent claim against the contractor and its surety on the contractor’s performance bond, on which the bank was co-obligee.

After the contractor stopped the work, the bank made demand on the contractor to complete the contract, but did not tender the balance which the contractor claimed to be due. The bank and the owner then engaged another contractor, who completed the work, and the bank claims $197,057 as damages for the increased cost of completion over the price limit specified in the original contract. The bank contends that even if the owner was in default when the contractor stopped the work, as the jury found in answer to issue number 15, the contractor had an independent duty to the bank, as co-obligee on the performance bond, to complete the work according to the contract, and that the bank has an independent right to damages for its failure to do so.

We find nothing in the bond that imposes such a duty on the contractor. The bond states that “if the contractor shall promptly and faithfully perform said contract, then this obligation shall be null and void,” and further provides:

There shall be no liability on the part of the principal or surety under this bond to the obligees or either of them, unless the obligees, or either of them, shall make payments to the principal . ... strictly in accordance with the terms of said contract as to payments, and shall perform all the other obligations required to be performed under said contract as the time and in the manner therein set forth.

Under this provision, the bank might have been entitled to demand that the contractor complete the job if it had tendered the balance currently due under the terms of the contract. Certainly, nothing in the bond or in the contract requires the contractor to continue the work without such payment.

The bank argues, in effect, that nothing was due on application number 29 because that application overstated the “work completed and stored to date” by more than $72,000, and when that amount is deducted and all payments are credited on the costs reimbursable under the contract, no further payment was due when the contractor gave notice and stopped the work. Consequently, the bank argues, even though the owner may have owed additional sums outside the scope of the contract and may have been in default in its payment of those items the owner’s default in this respect cannot be attributed to the bank, and there was no unpaid balance on work actually done under the contract that justified the contractor in stopping the work.

This argument is based on New Amsterdam Casualty Company v. Bettes, 407 S.W.2d 307 (Tex.Civ.App.—Dallas 1966, writ ref’d n.r.e.), in which a construction lender was permitted to recover against the surety on the contractor’s performance bond for default by the contractor, who had abandoned the job in admitted violation of his obligations under the contract. The surety sought to escape liability on the ground that the contractor had presented and received payment on certificates that the owner knew to be false. The court held that such knowledge could not be attributed to the innocent lender so as to defeat its recovery against the surety for the contractor’s admitted default. The crucial distinction is that in the present case the contractor was not in default, as the jury found in answer to issue number 15. Consequently, whether the owner’s default bars the bank’s recovery is immaterial. When the contractor had not been paid the amount due, it was entitled, on proper notice, to stop the work. It was not guilty of any breach of contract for which it is liable in damages, either to the owner or to the bank.

The bank would have standing to complain of the application of payments and the contract accounting procedure between the owner and the contractor only in the event it had been misled and had relied to its prejudice on the amount shown as “total completed and stored to date” in application number 29 and previous applications. The present record contains no pleadings, evidence, or request for submission of issues raising this question in the trial court. Consequently, we conclude that the bank had no independent right of recovery against the contractor or its surety.

3. Inception of Contractor’s Lien

The bank also complains that the trial court erred in awarding the contractor a prior lien, superior to the bank’s deed of trust, on the apartment project. In this connection, the bank asserts that there is no evidence to support the jury’s finding in answer to special issue number 12 to the effect that the contractor had commenced visible construction of the project under the terms of the contract before the bank filed its deed of trust for record on July 20,1973. This issue submits the question of the “inception” of a contractor’s statutory lien, in terms of its definition in article 5459, section 2(a), of the Texas Revised Civil Statutes (Vernon Supp.1978), as follows:

The actual commencement of construction of improvements or the delivery of material to the land upon which the improvements are to be located for use thereon for which the lien herein provided results, provided such commencement or material is actually visible from inspection of the land upon which the improvements are being made.

The bank relies on the testimony of its loan officer that he had visited the site before July 20 and had seen no sign of visible work except the site preparation work done by another contractor. The bank urges that in order for the contractor’s lien to have had its inception before July 20, the contractor’s work at the site must have been such as to put the bank on notice that work under the construction contract itself was being done. The bank also argues that the contractor’s own records show that Campbell’s testimony concerning men at work at the site before July 20 was erroneous.

We hold that the jury’s finding that work done by the contractor before July 20, 1973 was “actually visible from inspection of the land” is supported by Campbell’s testimony, which the jury apparently believed. Campbell testified that before July 20, 1973, the contractor had caused four to six inches of soil to be removed from the site by earth-moving machinery, had set stakes for foundations for at least three buildings, had hauled several cubic yards of fill dirt and compacted it inside the building area, had done hand excavation for some of the grade beams, and had begun setting the forms around the outside of the foundations. The fact that the bank’s officer may have been erroneously informed that all the work he saw was being done by another contractor would not establish that the work done under the contract in question was not, in fact, “visible,” as provided by the statute. The bank’s evidence only raised a fact issue, which the jury has resolved in the contractor’s favor.

4. Contractor’s Lien for Lost Profit

The contractor presents a cross-point complaining of the court's failure to include its lost profit within the lien for which foreclosure was ordered. We overrule this point on the ground that the contractor is not entitled to a statutory lien for the amount of the profit lost on work not performed.

The contract provides for a fixed fee of $131,000 over and above reimbursable costs and requires ninety percent of the fee to be paid with the progress payments. One of the items shown on each application for payment is the contractor’s profit. Presumably this item concerns part payment of the fee provided in the contract. The amount of profit shown on the application number 29 is $91,281, most of which had been included in previous applications. The jury found that the amount of “uncompensated services performed and labor and materials furnished” by the contractor and its subcontractors was $160,144. Presumably, this amount includes the contractor’s fee for work actually done. The .jury also found that the amount of the profit the contractor would have made if it had completed the project was $30,216. Judgment was rendered for the contractor for both of these amounts, aggregating $190,360, with interest, but the $30,216 lost profit was not included in the amount for which the lien was foreclosed.

We assume, without deciding, that the contractor has a lien for his contractual fee for work actually performed. The question presented by the cross-point is whether the contractor has a lien for the profit he would have earned on services not performed because of the owner’s breach.

No authority is cited, and we have found none, supporting the contractor’s contention that he has a lien for the lost profit. The statute gives the contractor a lien “for the labor done or the material furnished or both for such construction.” Tex.Rev.Civ.Stat. Ann., art. 5452, § 1 (Vernon Supp.1978). Under this provision it is clear that a profit is secured by a statutory lien only to the extent that it may be considered compensation for services actually rendered as distinguished from the amount of the contractor’s loss because of the owner’s breach of the contract.

The only analogous Texas authority we have found holds that anticipated profit is not a proper basis for recovery of an attorney’s fee authorized by article 2226 of the Texas Revised Civil Statutes in a suit for “personal services rendered, labor done, materials] furnished,” etc. South Builders, Inc. v. Brown, 449 S.W.2d 542 (Tex.Civ.App.—Eastland 1970, writ ref’d n.r.e.).

Although we find no authority construing the Texas lien statute in this respect, the Supreme Court of Kansas denied a lien under a similar statute for the profit expected on the balance of an uncompleted contract. Elder Mercantile Co. v. Ottawa Inv. Co., 100 Kan. 597, 165 P. 279, 283 (1917). This holding is consistent with the theory that the lien provided in such a statute is based on enhancement of the property as a result of the labor and materials furnished. Bangor Roofing & Sheet Metal Co. v. Robbins Plumbing Co., 151 Me. 145, 116 A.2d 664, 666 (1955). Even if the contractor’s profit on work actually done may be considered compensation for services enhancing the value of the property, no such enhancement results from work left undone, regardless of who was responsible for the discontinuance.

Affirmed.


source: Caselaw Access Project

author: HUGHES, Justice.

license: Public Domain

text:
    FIRST CONTINENTAL REAL ESTATE INVESTMENT TRUST, Appellant, v. CONTINENTAL STEEL CO. et al., Appellees.
    No. 17941.
    Court of Civil Appeals of Texas, Fort Worth.
    June 8, 1978.
    Rehearing Denied July 27, 1978.

      Passman, Jones, Andrews, Coplin, Holley & Co., and Gerald R. Coplin, Dallas, for appellant.
    Geary, Stahl, Koons, Rohde & Spencer and D. Ronald Reneker, Dallas, for appel-lee, Continental Steel Co.
    Margraves, Kennerly & Schueler and Stephen W. Schueler, Houston, for appellee, Flintkote Supply Co.
    James H. Cummings, Dallas, for appellee, Freeway Ready Mix, Inc.
    Odom & Gwynn and G. Scott Odom, Dallas, for appellee, Jackson Concrete, Inc.
    Coke & Coke and Robert M. Roller, Dallas, for appellee, Krestmark Industries, Inc.
    Tucker, Gano, Alexander & Cochran and John H. Cochran, Dallas, for appellee, Sharp & Son, Inc.
    John Emmett, Dallas, for appellee, Wilcher-Moore Lumber Co.
   OPINION

HUGHES, Justice.

Continental Steel Company (Steel) sued H.E.M. Building Corporation (HEM), First Continental Real Estate Investment Trust (Trust) and Billy Scott Stanfield to foreclose a materialman’s lien on real estate composed of 15 lots in Lewisville, ,Texas. Numerous interventions and joinders increased the parties to 13. At issue is the priority of the liens of seven materialmen (all plaintiff-appellees) as compared to Trust’s deed of trust lien and alleged subro-gated vendor’s lien.

By stipulation it was agreed to non-suit the home owners involved, plaintiffs to forego lien foreclosures on individual homes and agreeing to sue for money judgments against Trust and HEM to the extent plaintiffs mechanic’s and materialman’s liens could be proven valid and superior to deed of trust liens in favor of Trust and if any part of Trust’s debt is found to be secured by vendor’s lien, then to the extent that Trust received consideration at a proper foreclosure sale on that vendor’s lien in excess of the amount of its debt secured by such vendor’s lien, if any.

This left Steel, Flintkote Supply Company, Wilcher-Moore Lumber Company, Jackson Concrete, Inc., Sharp and Son, Inc., Freeway Ready Mix, Inc., and Krestmark Industries, Inc., as plaintiffs aligned against HEM and Trust as defendants.

The case was tried to the court without a jury and resulted in the court rendering money judgments for all the plaintiffs against both of the defendants. HEM, which defaulted, did not appeal. Trust has perfected its appeal from such judgment.

We affirm in part and reverse and render in part.

Trust claims to be equitably subrogated to vendor’s lien rights formerly held by HEM’s predecessors in title and by a bank mortgagee holding a second vendor’s lien and purchase money mortgage deed of trust. It therefore claims a superior lien to all plaintiffs and that trial court erred in finding plaintiffs’ mechanic’s and material-men’s liens superior to any liens of Trust.

Trust urges in Point of Error number 1 that trial court should have found its liens superior to the plaintiff’s liens under the doctrine of equitable subrogation. Steel contends Point of Error number 1 was waived because Trust did not request, and the trial court did not make, any findings of fact respecting the defense of equitable subrogation. In its brief Trust claims sub-rogation by reason of funds it had advanced for HEM which paid off and got a release for purchase money owed on the land by HEM, even though the lien was not transferred to it by any written instrument.

We were cited Skeen v. Slavik, 555 S.W.2d 516, 520 (Tex.Civ.App.—Dallas 1977, writ ref’d n.r.e.) by Trust to the effect that where, in a case, “the evidence establishes as a matter of law facts inconsistent with the judgment” the presumption of all fact findings in favor of the judgment must be overturned. This concerned a situation where there was absent a jury verdict or any express finding of fact and conclusions of law by the trial court, as in the instant case. In Skeen, supra, admissions of the appellees that they were charging fees solely as compensation for the service of lending money, at what was indisputably usury, established usury. In the case at hand there are no such admissions from appellees setting up Trust’s claim of equitable subro-gation, nor are there facts “indisputably established by the record” to establish same.

We agree with Steel that equitable subrogation is an affirmative defense as alleged by Trust. It had the burden of proving such affirmative defense. Bradley v. Freeman, 163 S.W.2d 693 (Tex.Civ.App.—Amarillo 1942, no writ).

Since the record shows no specific request for or findings of fact on equitable subrogation and that trust did not request additional findings, we hold that such defense was waived for purposes of appeal. Gasperson v. Madill National Bank, 455 S.W.2d 381 (Tex.Civ.App.—Fort Worth 1970, writ ref’d n.r.e.). We overrule Point of Error number 1.

APPELLEE, CONTINENTAL STEEL

The essence of Trust’s Point of Error number 2 is that the steel material delivered by Steel was not proven to be incorporated into the work (emphasis ours) and visible before July 9, 1974, when, at 1:10 p. m., Trust filed its deed of trust. Blaylock v. Dollar Inns of America, Inc., 548 S.W.2d 924 (Tex.Civ.App.—Tyler 1977, writ granted). We disagree with Trust’s interpretation of Blaylock to the effect that until materials are incorporated into the work under Tex.Rev.Civ.Stat.Ann. art. 5452 (Supp.1978), for the purposes of the mechanic’s lien statutes they would not even be considered materials. The court in Blay-lock at page 930 lists four basic criteria under Tex.Rev.Civ.Stat.Ann. art. 5452 (Supp.1978), upon which to determine inception date of a mechanic’s lien. They are listed alternatively from each other by “or”. One of the criteria, which we hold to be present in this case, is:

“(2) The delivery of materials to the land upon which improvements are to be located for use thereon provided such material is actually visible from an inspection of the land.”

Trial court found that: Steel and HEM entered into a contract for Steel to furnish steel building material to HEM to be incorporated into the property; Steel made a delivery of steel building materials ordered by HEM to each of the lots in the property before 1:10 p.m. on July 9, 1974; such materials were visible on each lot by inspection before July 9, 1974 at 1:10 p.m.; such materials were incorporated into the property improvements; and Trust recorded the deeds of trust on the property at 1:10 P.M. on July 9, 1974.

Trial court had ample testimony to support its findings of fact and we must accept them. Arlington Acceptance Corporation v. Taylor, 426 S.W.2d 567 (Tex.Civ.App.—Fort Worth 1968, no writ).

Point of Error number 2 is overruled.

We overrule Point of Error number 3 which was one complaining of the trial court’s overruling an objection to a leading question. The question involved was leading (and suggestive), but its answer was cumulative of other evidence establishing the time of delivery of the materials.

Point of Error number 4 avers that Lot 8, Block B remained unimproved during all times relative to this dispute. Examination of the record reveals some testimony which controverts Billy Scott Stanfield, in his answer of “No” to the question “Was there any improvement on block B lot 8 at that time?” This question and answer covered the period of 20 or 30 days before trial and was what Trust relied on in this Point of Error.

There is testimony that:

Fifteen houses were to be built on the property; HEM ordered steel for 15 houses from Steel; Fred Gerson, HEM purchasing agent, ordered the steel, but “couldn’t swear” that Steel delivered steel for all the 15 houses that were being built, and he did see steel material at the job site. He also said the building materials furnished by Steel were incorporated into the work.

Also, it was stipulated by the parties that the property in question was made up of 15 lots, clearly the only lots in the case.

We hold that trial court had sufficient testimony for an issue. Trial court resolved it in favor of Steel. We have to sustain the trial court’s finding if any evidence supports it. Hous. Authority, etc. v. State ex rel. Velasquez, 539 S.W.2d 911 (Tex.Civ.App.—Corpus Christi 1976, writ ref’d n.r.e.).

Point of Error number 4 overruled.

APPELLEE, FLINTKOTE

Trust avers that the trial court erred in holding Flintkote’s lien on all the lots had its inception when Flintkote first delivered materials to any one of such lots. Flintkote claims that the lots were treated as one property and that the lien attached to all as of the first incipiency.

Trial Court’s finding of fact number 29 found that: The lots comprising the property were treated as a unit by owner HEM and by Trust. Finding of fact number 30 found that materials furnished by Flintkote were purchased by HEM from Flintkote for all lots comprising the property as one transaction. These findings were uncontested by Trust. Trust did not object or except to them when made and did not request any findings contrary to or different from such findings.

Conclusion of law number 9 was based on the above findings (29 and 30) and held that the lots comprising the property were treated as one unit and that Flintkote’s lien had its inception on the date of its first delivery which was before recordation date of the deed of trust.

The findings and conclusions are supported by the testimony that the houses were all in one area; that HEM instructed its purchasing agent to buy material for all the houses on the property “as one entire project”, being the usual course of business. Also, there was the testimony of Trust’s employees, Stargel and Conger, that the project was treated as one transaction. We must accept these unchallenged findings of fact as correct. Browne v. General Electric Company, 402 S.W.2d 957 (Tex.Civ.App.—San Antonio 1966, writ dism’d); Whitten v. Ailing & Cory Company, 526 S.W.2d 245 (Tex.Civ.App.—Tyler 1975, writ ref’d).

We hold that trial court had sufficient evidence to find Flintkote’s lien extended to all lots comprising the property and had its inception before the recordation of trust’s deed of trust. Lyon v. Logan, 68 Tex. 521, 5 S.W. 72 (1887). Habitat v. McKanna, 523 S.W.2d 787 (Tex.Civ.App.—Eastland 1974, no writ). Since a mechanic's lien is but one legal right and a portion of the lien was established before the deed of trust was filed the entire lien has the same priority. University Savings and L. Ass’n v. Security Lumber Co., 423 S.W.2d 287 (Tex.1967).

We overrule points of error numbers 5, 6 and 7.

APPELLEE, KRESTMARK

It is undisputed that Krestmark made its first delivery of material to the lots in question on July 20, 1974, after the deed of trust was filed on July 9, 1974. Error is urged by Trust that Krestmark’s lien inception date should have been found by the trial court as of July 20, 1974, not back to the first delivery by Steel in June. Since Krestmark’s dealings were with the owner (HEM) and not through a general contractor under a general contract, we agree that the inception of its lien was eleven days after the deed of trust lien was filed. McConnell v. Mortgage Investment Co. of El Paso, 157 Tex. 572, 305 S.W.2d 280 (1957); Regold Manufacturing Company v. Maccabees, 348 S.W.2d 864 (Tex.Civ.App.—Fort Worth 1961, writ ref’d n.r.e.).

We sustain point of error number 8.

However, we hold that the trial court had sufficient evidence before it to conclude that the materials furnished by Krestmark could be removed without material injury to the land and pre-existing improvements or to the improvements themselves. First National Bank in Dallas v. Whirlpool Corp., 517 S.W.2d 262 (Tex.1974). Testimony adduced reflected: windows and doors furnished by Krestmark could be removed by taking out the brick around them with no ultimate damage to the brick or windows; the trim around the doors could be removed without ultimate damage; both brick and trim could be replaced without material damage. We overrule point of error number 9, which, in effect, obviates our ruling on point of error number 8.

We come to Trust’s claim of trial court error in holding Krestmark’s lien valid, when it failed to give mandatory notice required by Tex.Rev.Civ.Stat.Ann. art. 5453 (Supp.1978), (sending two copies of affidavit by original contractor claiming a lien by registered or certified mail to the owner).

We conclude trial court had sufficient evidence of compliance with this rule in light of Tex.Rev.Civ.Stat.Ann. art. 5456(1) (Supp.1978), which provides for delivery in person to the party or his agent instead of written notice “irrespective of other methods of notice or communications herein provided.”

In this case, Fred Gerson was concluded by the trial court to be an agent of HEM. This conclusion was not attacked on appeal. Bob Wolf testified to delivering copies of the required affidavit to Fred Gerson (along with the invoices) within 120 days from the 10th of the month next following the last delivery of materials. We overrule point of error number 10.

APPELLEES, FREEWAY, JACKSON, WILCHER AND SHARP

We sustain points of error numbers 11,13 and 16. Freeway’s first delivery to property was July 11, 1974. Jackson’s first delivery to property was July 20, 1974. Wilcher’s first delivery to property was July 24, 1974, All were after the July 9, 1974 deed of trust recordation. Our reasons are stated in point of error number 8.

We sustain points of error numbers 12,14 and 18 because Freeway, Jackson and Sharp failed to give the mandatory notice to HEM required by Tex.Rev.Civ.Stat.Ann. art. 5453 (Supp.1978). Yeager Elec. & Plumb, v. Ingleside Cove L. & B., 526 S.W.2d 738 (Tex.Civ.App.—Corpus Christi 1975, no writ).

APPELLEE, WILCHER-MOORE

Point of error number 17 is sustained for the reason that Wilcher claimed a lien on Lot 41, Block A, because there is no evidence that such lot is involved in this case.

APPELLEE, JACKSON

We sustain point of error number 15 because Jackson did not have pleadings on which a judgment could be based. Carreon v. Texas St. Dept, of Public Welfare, 537 S.W.2d 345 (Tex.Civ.App.—San Antonio 1976, no writ).

APPELLEE, SHARP

Point of error number 19 is sustained because the evidence introduced by Sharp showed its lien affidavits filed on January 15, 1975 which was 151 days after Sharp evidenced its last delivery on July 22, 1974.

We affirm the judgment of the trial court insofar as it applies to HEM.

We affirm the judgment of the trial court with respect to its rendition against Trust and for Steel, Flintkote and Krest-mark.

We reverse the judgment of the trial court insofar as it renders against Trust and for Wilcher, Jackson, Sharp and Freeway. We render judgment for Trust that Wilcher, Jackson, Sharp and Freeway take nothing in their claims against it.


author: SHANNON, Justice.

text:
    FREEDOM, INCORPORATED, Appellant, v. The STATE of Texas, Appellee.
    No. 12758.
    Court of Civil Appeals of Texas, Austin.
    July 5, 1978.
    Rehearing Denied Aug. 16, 1978.
    Robert D. McPherson, Houston, for appellant.
    John L. Hill, Atty. Gen., Thomas M. Pol-lan, Asst. Atty. Gen., Austin, for appellee.
   SHANNON, Justice.

This is an appeal from a temporary injunction that restrained appellant Freedom, Incorporated, from engaging in the bail bond or surety business.

Appellant is a corporation created pursuant to the Texas Business Corporation Act. Appellant’s purpose is stated in its Articles of Incorporation as: “The transaction of any and all lawful business for which a corporation may be incorporated under the Texas Business Corporation Act.” Appellant does not hold a certificate of authority from the State Board of Insurance.

Appellant applied to the Harris County Bail Bond Board for a license to act as a bondsman. Before the Harris County Bail Bond Board had acted on the application, the State of Texas filed a quo warranto suit against appellant in the district court of Travis County seeking cancellation of appellant’s charter and ancillary injunctive relief. After hearing the district court entered the temporary injunction.

Appellant claims that a corporation may engage in the bail bond or surety business without authorization from the State Board of Insurance. We do not agree.

A corporation may qualify to write bail bonds provided the corporation is empowered to act as a surety. Tex.Rev.Civ.Stat. Ann. art. 2372p-3 § 7 (Supp.1978); Tex. Code Crim.Proc.Ann. art. 17.06 (1977). A corporation acting as a professional surety is engaged in the insurance business, Tex. Ins.Code Ann. art. 1.14-1 § 2(a)(2) (Supp. 1978), and is therefore required to obtain a certificate of authority from the State Board of Insurance. Tex.Ins.Code Ann. art. 1.14 (1963). An insurance company may not be organized under the Texas Business Corporation Act. Tex.Bus.Corp.Act.Ann. art. 201B(4)(d) (1956).

Appellant claims that the disposition of this appeal is controlled by an unpublished opinion, Heard v. Scroggins, Docket No. 1,459 (Tex.Civ.App. — Houston [14th Dist.], October 27, 1976, writ ref’d n. r. e.) (unreported). A copy of that opinion appears as an exhibit in the statement of facts. The Houston Court of Civil Appeals in Heard was not presented with the problem before this Court. The applicable portion of the opinion is as follows:

“Appellants’ third and fourth points complain of the [district] court's judgment that a Texas business corporation can be a licensed bail bondsman and that property given as security on a bail bond can be owned by a Texas corporation. The asserted error is that the pleadings do not pray for such declarations and that the judgment does not conform to the pleadings. We disagree . . .” (Emphasis added).

The Court then examined the prayer in the petition and concluded that the prayer authorized the relief granted by the district court.

Because appellant corporation is not qualified to act as a surety, appellant may not engage in the bail bond or surety business. The judgment is affirmed.

Affirmed.


author: PHILLIPS, Chief Justice.

text:
    TEXAS STATE DEPARTMENT OF HUMAN RESOURCES, Appellant, v. SILVER THREADS COMPANY, Appellee.
    No. 12765.
    Court of Civil Appeals of Texas, Austin.
    July 12, 1978.
    Rehearing Denied Aug. 2, 1978.

      John L. Hill, Atty. Gen., C. J. Carl, Asst. Atty. Gen., Austin, for appellant.
    Andrew L. Jefferson, Jr., Jefferson & Maley, Houston, for appellee.
   PHILLIPS, Chief Justice.

Appellee is the operator of Silver Threads Nursing Home in Houston, Texas. It was a vendor of nursing home services to Medicaid recipients through a contract with the Texas Department of Public Welfare, pursuant to the Medical Assistance Act of 1967, Art. 695j-1, V.C.S. (Acts 1967, 60th Leg., ch. 151, p. 310).

In July of 1976, the Commissioner of the Department notified appellee that the contract was being canceled and terminated because of an alleged violation of Article I, Section H, of the contract.

On September 16 and 17, 1976, a hearing was conducted by the Department’s Contract Appeals Committee upon appellee’s request. This hearing was held to determine whether there were grounds for the cancellation of the contract.

The committee made its decision in October, 1976, and concluded that the contract had been breached and that just cause existed for the cancellation. A petition for rehearing was denied. Subsequently, ap-pellee filed a petition for judicial review in the district court of Travis County.

Pursuant to trial before the court, the court reversed the decision of the appeals committee of the Department of Public Welfare and rendered judgment for appel-lee.

We reverse the judgment of the trial court and herewith render judgment reinstating the order of the Commissioner.

I.

The contract committee of the Department which heard the evidence and made the determination in question consisted of four persons, each sitting as the designated representative for the four departmental officials who compose the regular committee membership pursuant to the rules of the Department.

The decision of the Contract Appeals Committee was based upon its finding that the nursing home did not promptly notify the Department on occasions when seven different patients were discharged from the nursing home, thus violating Article I, Section H, of the contract.

Appellant is before this Court on several points of error, its first being the error of the court in overruling its plea in abatement based on the State’s contention that Section 9A of Art. 695j-l, V.C.S., precludes judicial review, thus establishing the State’s inherent immunity from suit.

The 65th Legislature amended the Texas Medical Assistance Act of 1967, Art. 695j-l, V.C.S., by adding Section 9A, the pertinent part being as follows:

“Any person, association, or corporation contracting with the State Department of Public Welfare to provide medical assistance under this Act may request a hearing upon receipt of notice from the Department of the intended cancellation of the contract by the Department. The Department shall promulgate rules and regulations to provide for reasonable notice to such contractors of its decision to cancel a contract and to allow the contractors an opportunity for a hearing. Said rules and regulations shall be consistent with the Administrative Procedure and Texas Register Act (Article 6252-13a, V.T.C.S.) and the hearing shall be held under the contested case provisions thereof, including those for judicial review . . ” (Acts 1977, 65th Leg., ch. 156, p. 325).

In our judgment Section 9A authorizes judicial review of the decisions of the Department of Public Welfare concerning contracts entered into for medical assistance after a proper hearing has been held relative thereto.

We cannot agree with appellant’s contention that Section 9A quoted above refers to the judicial review and contested cases, or Section 19, of the Administrative Procedure and Texas Register Act solely in reference to the manner in which the hearing shall be held under Article 695j-l, § 9A, and does not m any way authorize judicial review of the decision emanating from that hearing. We agree that the phrasing of the statute is somewhat unclear; however, Sec. 19 of Article 6252-13a referred to in § 9A of Article 695j — 1 is concerned with: “A person who has exhausted all administrative remedies available within the agency and who is aggrieved by a final decision in a contested case is entitled to judicial review under this Act. This section is cumulative of other means of redress provided by statute.” The remaining portion of Section 19 details the manner of securing judicial review in the district court of Travis County, Texas. Consequently, to construe § 9A of Article 695j — 1 as appellant would have us do is entirely unwarranted.

Our construction also comports with the long settled law of this State that where a vested property right has been affected by the action of an administrative agency, thereby involving the protection of due process of law, there is an inherent right of appeal. Chemical Bank & Trust Co. v. Falkner, 369 S.W.2d 427 (Tex.1963); Brazosport Savings & Loan Association v. American Savings and Loan Association, 161 Tex. 543, 342 S.W.2d 747 (1961); City of Amarillo v. Hancock, 150 Tex. 231, 239 S.W.2d 788 (1951). In our judgment appel-lee’s right to a valuable contract constitutes a vested property right.

II.

Article I, Section H, of the contract between appellee and the Department contains the following provisions:

“ . . .In addition to promptly informing the Department of any change of ownership, the facility will promptly inform the Department when individuals receiving any type of assistance from the Department enter and leave the facility and will promptly inform the Department of any change in its license to operate issued by the State Department of Health

Pursuant to the hearing described above, the Contract Appeals Committee of the Department issued an order stating that on July 25, 1976, the Department gave notice in writing to appellant that the contract was being canceled because of breach of the terms of Article I, Paragraph H, requiring that the facility (appellee nursing home) promptly notify the Department when individuals could under the Title XIX Program enter or leave the facility. The order finds that in nine separate instances appellee failed to notify the Department of Medicaid recipients being discharged and leaving the nursing home up to and until April 22,1976.

The trial court held that these findings by the Commissioner were not supported by substantial evidence. We disagree.

The procedure for notifying the Department that a patient has been discharged is as follows: A Form 618 is sent the nursing home in each instance of discharge. This form comprises three copies — a white copy sent to the Department, a yellow copy sent to the Department’s regional office, and a pink copy is retained by the nursing home.

In six of the cases under review, the only evidence that the Department was promptly notified of the discharge was furnished by the introduction of the pink form which did show, for the purposes of this opinion, that the patients had been discharged and the dates on these pink slips could be said to show prompt compliance with the Commissioner’s directive. The Commissioner, on the other hand, contended that it was many months later when the Commission was made aware of the discharges in question.

Able counsel for appellee strove valiantly to prove that the counterparts to these pink slips had either been lost or misplaced by an inept bureaucracy. However, we must conclude that reasonable minds, under the evidence adduced before the Commissioner, could well have concluded otherwise. Trapp v. Shell Oil Co., 145 Tex. 323, 198 S.W.2d 424 (1946); Railroad Commission v. Shell Oil Co., 139 Tex. 66, 161 S.W.2d 1022 (1942); Consolidated Edison v. N. L. R. B., 305 U.S. 197, 59 S.Ct. 206, 83 L.Ed. 126 (1938).

III.

Appellee asserts, and the court so found, that under the administrative rules of the Department any one of the commissioners, if unable to serve, may appoint a designee to serve on the committee in his place; that no such designation was made for those members of the Contract Appeals Committee who actually heard the case.

We cannot agree with this contention either. The order stating the decision of the Contract Appeals Committee specifically sets out the names of the members thereof, and further states that they were sitting as designees of the various commissioners of the Department also named in the order.

We reverse the judgment of the trial court and render judgment reinstating the Commissioner’s order.

Reversed and Rendered.

      . Now designated as the Texas Department of Human Resources.

      . Section 19(a), Article 6252-13a, V.C.S.

      . At trial appellee objected to the court’s announcement that the case would be tried under the substantial evidence rule. The objection was overruled. As there is no point before this Court assigning error to that ruling, we will review the case under that standard.


text:
    NATIONAL STANDARD INSURANCE COMPANY et al., Appellants, v. Melvin R. BEARD, Appellee.
    No. 12763.
    Court of Civil Appeals of Texas, Austin.
    July 26, 1978.
    Rehearing Denied Aug. 16, 1978.

      0. L. Knutson, Houston, for appellants.
    Charles B. McGregor, Beard & Kultgen, Waco, for appellee.
   SHANNON, Justice.

This is an appeal from the order of the district court of Bell County overruling the plea of privilege of appellants National Standard Insurance Company, American General Insurance Company, and American General Fire and Casualty Insurance Company, and pertains to Tex.Rev.Civ.Stat.Ann. art. 1995 § 29a (1964).

Appellee Melvin R. Beard filed suit for breach of contract against Maryland Casualty Company and appellants. Beard’s suit was predicated on an agency contract with the insurance companies.

Beard alleged that the insurance companies did business in Houston under the name, “American General Companies.” Appellee Beard proved that Maryland Casualty Company is a foreign corporation engaged in the business of insurance in Texas and that it maintains an agent in Bell County. All of the insurance companies filed pleas of privilege which the district court overruled. Maryland Casualty Company has not appealed from the order overruling its plea.

For more than ten years the insurance companies maintained an agency contract with Beard. In November, 1975, the “American General Companies” notified Beard that his agency contracts “with the American General Companies” were terminated as of May, 1976.

Beard alleged that as a result of the breach, he suffered loss of insurance commissions in the sum of $30,600.00, in addition to an earned “bonus trip” worth $2,500.00. He pleaded further that the wrongful breach reduced the value of his insurance agency in the sum of $53,125.00.

Section 29a of art. 1995 provides:

“Two or more defendants. — Whenever there are two or more defendants in any suit brought in any county in this State and such suit is lawfully maintainable therein under the provisions of Article 1995 as to any of such defendants, then such suit may be maintained in such county against any and all necessary parties thereto.”

Because appellants and Maryland Casualty Company are not residents of Bell County and because Beard established venue in Bell County as against Maryland Casualty Company by virtue of Tex.Rev.Civ.Stat. Ann. art. 1995 § 27, the question on appeal is whether appellants are necessary parties to the suit against Maryland Casualty Company for purposes of § 29a.

Beard claims that appellants were necessary parties within the meaning of § 29a, and as a result, the district court did not err in overruling the plea of privilege. We agree.

A necessary party is one whose join-der is required to afford the plaintiff the complete relief to which he is entitled against the defendant who is properly sua-ble in that county. Ladner v. Reliance Corp., 156 Tex. 158, 293 S.W.2d 758 (1956); Union Bus Lines v. Byrd, 142 Tex. 257, 177 S.W.2d 774 (1944); Orange Assoc., Inc. v. Albright, 548 S.W.2d 806 (Tex.Civ.App.1977, writ dism’d).

Appellants argue that they were not necessary parties since Beard could have obtained a judgment against Maryland Casualty Company for the full amount due against it without joinder of appellants. To the contrary, Beard claims that his pleading and proof showed that he could not obtain the full relief to which he was entitled, namely, a joint as well as a several judgment against appellants and Maryland Casualty Company unless all of the parties were sued in the same action. Orange Assoc., Inc. v. Albright, supra.

Beard could have recovered from Maryland Casualty Company the amount of insurance commissions owed him without joinder of appellants. Nevertheless, an examination of Beard’s pleading shows that he sought a joint and several judgment for $53,125.00 in damages for breach of the agency contract against Maryland Casualty Company and appellants.

At least with respect to his claim for $53,125.00 in damages Beard asserted all of his rights by seeking both a joint and several judgment against Maryland Casualty Company and appellants. Such being the case, Beard is entitled to the complete relief sought, that is, Beard is entitled to seek a joint judgment against Maryland Casualty Company and appellants, as well as a several judgment against each of them. Accordingly, appellants are “necessary” parties within the contemplation of § 29a. Commonwealth Bank & Trust Co. v. Heid Bros., Inc., 52 S.W.2d 74 (Tex.1932); Orange Assoc., Inc. v. Albright, supra.

The judgment is affirmed.

Affirmed.


author: O’QUINN, Justice.

text:
    Charles FLEMING et al., Appellants, v. William ENTZMINGER et al., Appellees.
    No. 12842.
    Court of Civil Appeals of Texas, Austin.
    July 26, 1978.
    Rehearing Denied Aug. 16, 1978.

      J. W. Thomas, Jr., Temple, for appellants.
    Jack W. Prescott, Prescott, Greenfield, Mewhinney & Wilson, Temple, for appel-lees.
   O’QUINN, Justice.

Two qualified .voters, residing within the limits of Academy Independent School District in Bell County, brought this suit in February of this year in contest of a school bond election held January 28, 1978, at which a majority of the voters approved issuance of bonds for permanent improvements. The seven members of the board of trustees were made parties defendant.

Contestants rest their action on a claim that the trustees bribed all voters in the district who were sixty-five years of age or older by granting them residence homestead exemptions in November of 1977, thereby inducing these voters to vote for the bonds at the election held about two months later in January.

The trial court upon hearing granted motion of the school trustees for summary judgment and entered judgment that contestants take nothing by their suit. We will affirm the judgment of the trial court.

The trustees of the school district, at the board’s regular meeting in November of 1977, pursuant to authority granted under the Constitution of Texas, authorized a residence homestead exemption from ad valo-rem taxes for all persons within the district sixty-five years of age or older. Authority for such action is stated in this language:

“From and after January 1, 1973, the governing body of any county, city, town, school district, or other political subdivision of the State may exempt by its own action not less than Three Thousand Dollars ($3,000) of the assessed value of residence homesteads of married or unmarried persons sixty-five (65) years of age or older, including those living alone, from all ad valorem taxes thereafter levied by the political subdivision.” (Emphasis added) (Art. VIII, Sec. l-b(b), Texas Constitution, as adopted November 7, 1972).

At the next regular meeting of the trustees in December of 1977, the Board took appropriate action to call an election, to be held on January 28, 1978, on a proposition for adoption or rejection by the qualified voters of proposed bonds for construction of school buildings. The election was held, and canvass of the returns reflected that the bond proposition was adopted by a vote of 372 to adopt against 132 to reject the proposal for issuance of bonds.

In their claim that the board of trustees bribed the voters sixty-five years of age and older, contestants seek to apply provisions of Article 36.02, Title 8, Texas Penal Code, to the action of the trustees in granting the homestead exemptions. Article 36.-02 provides that an offense is committed if a person offers or confers a benefit on a voter, “with intent to influence the voter not to vote or to vote in a particular manner.”

The contestants do not claim that all voters accorded homestead exemptions participated in the election and voted for the bonds, nor do they allege that the result of the election would have been different if the exemption had not been granted, but only that it is “impossible to ascertain the true result of the bond election” because the election “was substantially unfairly conducted in that” the homestead exemption influenced the voters accorded exemption “both in the vote and their influence in the election.”

Contestants sued the trustees in the trustees’ official capacity as the governing body of the school district. Article 36.02 of the Penal Code, making bribery an offense, deals with individuals and is not designed to control official action of a body corporate managing the affairs of a political subdivision while acting without question within authority granted under the Constitution and statutes.

The board of trustees acted clearly within the scope of its powers both in granting homestead exemptions to residents of the district sixty-five years of age or older and in calling the election at which the qualified voters approved issuance of bonds. The motives influencing the trustees in taking either of these legislative actions is not a subject of inquiry by the courts in an election contest.

It is not a function of the courts to inquire into the motives and intentions of a legislative body, except insofar as the inquiry may aid in arriving at the true construction and meaning of language used in the legislation. No construction will be adopted that rests on the assumption that the legislative body intended to do unfair, unjust, or unreasonable things. See 53 Tex. Jur.2d Statutes, sec. 166, p. 246 (1964), and authorities cited. The motives which influenced the legislative body ordinarily will not be inquired into by the courts. 82 C.J.S. Statutes, sec. 354, p. 745 (1953); see also Wiseman v. Madison Cadillac Co., 88 S.W.2d 1007 (Ark.Sup.1935); Morrow v. City of Louisville, 249 S.W.2d 721, 724 (Ky.Ct.App. 1952).

In an early case before the Supreme Court validity of bonds approved at a school district election was challenged on the basis that the earlier legislative Act creating the school district had perpetrated a “legislative fraud,” which invalidated the bonds voted. In the present case contestants say the grant of homestead exemptions by the trustees brought about an unfairly conducted bond election two months later, with the result that the bonds were invalid. The Supreme Court held that all matters relating to unfairness, injustice, fraud, inadvertence, and unreasonableness were settled by enacting the law. Glass v. Pool, 106 Tex. 266,166 S.W. 375, 377 (1914). If there be a wrong in the present case, as contestants contend, the courts have no power to act in the matter since the legislative action of granting homestead exemptions is not shown to be in conflict with the Constitution or the statutes in any particular. Glass v. Pool, supra.

The judgment of the trial court that appellant contestants take nothing by their suit is in all things affirmed.

Affirmed.

      . Plaintiffs below, who are appellants here, are Charles Fleming and Forrest Lawson. Defendants below, trustees of the school district, now appellees, are William Entzminger, Bobby Heller, Bob Mahler, Bobby Underwood, Bill Reeves, G. C. Walker, and Walter Tomlin.


author: STEPHENSON, Justice.

text:
    Charles Samuel McDONALD, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Supreme Court of Kentucky.
    June 13, 1978.
    Rehearing Denied Aug. 22, 1978.

      Terrence R. Fitzgerald, Deputy Dist. Defender, Daniel T. Goyette, Associate Director, William C. Grimes, Asst. Public Defender, Louisville, for appellant.
    Robert F. Stephens, Atty. Gen., David M. Whalin, Asst. Atty. Gen., Frankfort, for appellee.
   STEPHENSON, Justice.

Charles Samuel McDonald was indicted and tried for the offenses of indecent and immoral practices, KRS 435.105, assault and battery, KRS 431.075, and rape, KRS 435.-090.

A jury found McDonald guilty on all three counts and sentenced him to imprisonment for five years on the count of indecent and immoral practices, twelve months on the count of assault and battery, and life without parole on the count of rape. McDonald appeals. We affirm.

On June 6, 1974, McDonald was released on parole from LaGrange. In 1973, McDonald was convicted on a plea of guilty for two offenses of committing indecent and immoral practices upon his twelve-year-old stepdaughter, Renita Griffin. He was sentenced to three years’ imprisonment on one charge and to ten years on the other charge which was probated.

On the morning of June 7, according to McDonald, he went to his wife Evelyn’s house, where an argument ensued about his wife’s relationship with another man. His wife’s version was that McDonald forced his way into the house and proceeded to beat her and speak of revenge against her and Renita Griffin, the stepdaughter. McDonald admitted that he struck his wife several times. While this argument was proceeding, Renita and a girl friend were in an upstairs bedroom. McDonald, hearing movement upstairs, went up the stairs yelling for the other man to show himself and forced open the bedroom door to find Reni-ta there. According to McDonald, he then left Renita and her girl friend and resumed the argument with his wife. According to the wife and Renita, he dragged both of them into another bedroom where he forced his wife to have oral sex with him and then proceeded to rape Renita. The scenario ended when the wife ran down the stairs and out of the house with McDonald in pursuit. The wife called the police and McDonald was apprehended and placed under arrest. Three years later, on June 7, 1977, McDonald was tried and convicted of the charge.

The first and most significant argument for reversal is the assertion that the delay between arrest and trial denied McDonald his constitutional right to a speedy trial.

The case was first set for trial on October 24, 1974, and the succeeding dates the case was set for trial appear as follows:

1. On October 24, 1974, case continued to January 15, 1975, on motion of Commonwealth.
2. On January 15, 1975, case continued to March 3,1975, on motion of McDonald.
3. On March 3, 1975, case continued to May 14, 1975, on motion of McDonald.
4. On May 14, 1975, case continued to September 23, 1975, on motion of Commonwealth.
5. On September 23, 1975, trial of the case commenced. On motion of McDonald a mistrial was granted by the trial court and the case continued to January 14, 1976. McDonald’s motion to dismiss for lack of speedy trial was overruled.
6. On January 14, 1976, the case was continued to April 5,1976, on court’s own motion. McDonald’s motion to dismiss for lack of speedy trial overruled.
7. On April 5, 1976, the case was passed by the trial court for the purpose of subjecting McDonald to a psychiatric examination. After the results of the examination were filed with the trial court, the Commonwealth moved to have the case set for trial. The trial court then set the case for trial on October 25,1976. In the interim, McDonald filed motion to dismiss for lack of speedy trial.
8. On October 25, 1976, the case was continued to February 9, 1977, on joint motion of the Commonwealth and McDonald.
9. On February 9, 1977, the case was continued to March 21,1977, on motion of the Commonwealth.
10. March 21,1977, the case was ordered transferred to another division of the court due to a conflict of interest on the part of the new judge sitting in the division, and the case was continued to April 1, 1977.
11. On April 1,1977, the case was passed to April 4, 1977, on the trial court’s own motion.
12. On April 4, 1977, the case was continued to June 6, 1977, on motion of the Commonwealth.
13. On June 7, 1977, the trial commenced resulting in the conviction here on appeal.

McDonald was in custody during the entire period. After the mistrial was granted by the trial court on September 23, 1975, the trial court revoked McDonald’s probation of the previous charge and he was returned to the penitentiary.

We are in accord with the proposition that a delay of three years between arrest and trial dictates an inquiry into the circumstances of the delay in order to determine if there has been a violation of the constitutional guarantees of a speedy trial.

The Supreme Court of the United States, after considering the speedy trial issue on several occasions, finally in Barker v. Win-go, 407 U.S. 514, 92 S.Ct. 2182, 33 L.Ed.2d 101 (1972), fashioned a set of factors to be considered in resolving the issue of speedy trial. These four factors which are to be considered are as follows:

1. The length of the delay;
2. The reasons for the delay;
3. The defendant’s assertion of his right
to a speedy trial; and
4. Prejudice to the defendant.

Barker was finally brought to trial more than five years after his arrest. From arrest in 1958 until 1963, when Barker was tried and convicted, the Commonwealth was granted a series of sixteen continuances of the Barker trial. Early in 1962, Barker moved to dismiss for lack of speedy trial. He had made no objection to the continuances until three and one-half years after he was arrested. There was no showing that any of Barker’s witnesses had died or were otherwise unavailable owing to the delay. The reason for the delay in bringing Barker to trial was the belief by the prosecution that there was a stronger case against an accomplice, Manning, and that if Manning could not be persuaded to testify against Barker, it was unlikely Barker would be convicted. Manning was finally convicted of one of the murders in March 1962 after the fifth trial and was convicted of the other murder in December of 1962. Two of Manning’s trials resulted in hung juries and two were reversed by this court for new trials during the period. Thereafter there was a delay due to the illness of a key prosecution witness; and, finally in 1963, Barker was brought to trial and convicted with his accomplice Manning as the chief prosecution witness.

In affirming the case, the U.S. Supreme Court applied the balancing factors, concluding that the delay was inordinate but that Barker had never asserted his right to a speedy trial, nor objected to the continuances until early in 1963, and that there was only minimal prejudice to Barker by reason of the delay. The controlling conclusion was that Barker did not want a speedy trial.

As to the length of the delay here, it is of sufficient duration to trigger an inquiry. The denial of the right to a speedy trial cannot be determined exactly in an all-inclusive time period. Whether this right has been violated must depend on the particular context of each case. It is a vague concept incapable of precise definition and must be balanced with the procedural safeguards provided an accused, which in themselves cause the process to move at a deliberate pace, and recognition of the fact that dismissal for a violation of the right to speedy trial is a severe remedy from the standpoint of society. In addition, delay can work to the advantage of a defendant. Consequently, the length of the delay must be balanced against the other factors.

The reasons for the delay here militate against McDonald. Throughout these proceedings it is apparent the Commonwealth was making a good-faith effort to bring McDonald to trial. Here McDonald did not object to any of the continuances. The record is vague as to the reasons for many of the continuances, but Barker recognizes that a valid reason for the continuance should serve to justify appropriate delay. McDonald does not argue that any of the continuances were inappropriate. Finally, on this factor McDonald participated in the delay. The continuance on March 3, 1975, was on McDonald’s motion. On September 23, 1975, the case was continued after the trial court granted McDonald’s motion for a mistrial. As late as October 25, 1976, McDonald participated in a continuance on a joint motion with the Commonwealth. Barker observed that if delay is attributed to the defendant, then his waiver may be given effect under standard waiver doctrine.

During the course of these proceedings, McDonald on four separate occasions filed motions to dismiss the charges on the ground that he had been denied a speedy trial. The first motion to dismiss for lack of a speedy trial was made at the hearing immediately after his motion for a mistrial was granted and can hardly be characterized as a good-faith motion. We cannot say that a motion to dismiss for lack of a speedy trial is the same as a motion for a speedy trial in that it unequivocally puts the trial court on notice that the defendant demands a speedy trial. The motion to dismiss presents an issue which must be decided by the trial court based on the delay prior to the motion. Here the trial court was never put on notice that McDonald demanded or wanted a speedy trial.

In Barker v. Commonwealth, Ky., 385 S.W.2d 671 (1964), this court considered Barker’s motion to dismiss for denial of a speedy trial as a motion for speedy trial. However, in Barker the opinion observed that it was clear that Barker had not made an alternative motion for an immediate trial, thus we consider the United States Supreme Court treated the motion to dismiss for denial of a speedy trial as different from a motion for speedy trial. Barker rejected a rigid demand-waiver rule but observed that there is some responsibility on the defendant to assert his right to a speedy trial.

As to prejudice to McDonald, there is no showing that the delay confounded or impaired his defense in any respect, nor did the delay result in unavailability of witnesses for McDonald.

We are of the opinion that the delay here was extraordinary and presumptively prejudicial; however, in balancing the factors set out in Barker we are of the further opinion the prosecution exercised good faith in attempting to bring McDonald to trial, the delays were not shown to be for other than valid reasons and a significant portion of the delays is attributed to McDonald. We are of the further opinion that McDonald did not assert his right to a speedy trial, rather he hoped to take advantage of the delay in order to obtain a dismissal of the charge, and that the prejudice to McDonald by reason of the delay was minimal if any prejudice resulted at all. We are not advised of the effect the pending charges had on McDonald’s prospects for parole. We conclude that balancing the Barker factors McDonald was not denied his constitutional right to a speedy trial.

In Moore v. Arizona, 414 U.S. 25, 94 S.Ct. 188, 38 L.Ed.2d 183 (1973), there was a three-year delay after Moore was charged before he was brought to trial. During this period Moore was in prison in California and had asserted his right to a speedy trial. Also a defense witness had been deported and was unavailable. The opinion did not hold that this delay was a denial of a speedy trial but remanded the case to the Arizona Supreme Court to apply the balancing factors in Barker instead of relying solely on lack of prejudice in the delay.

Next McDonald argues that prosecu-torial misconduct forced him to move for a mistrial on September 23,1975, and thereby he was twice placed in jeopardy.

After the jury was sworn on September 23, 1975, the prosecution moved the trial court (a different trial court than finally tried the case) to reconsider a previous ruling on the admissibility of McDonald’s prior convictions for sexual offenses against his stepdaughter. The trial court then held the prior convictions to be admissible. McDonald’s counsel claimed surprise and that he was not prepared to meet the evidence. After a hearing in chambers with McDonald’s counsel insisting on a mistrial, the trial court granted McDonald’s motion and continued the case. McDonald argues improper conduct on the part of the prosecutor and the trial court in forcing him to request a mistrial. We are not prepared to say that it is prosecutorial misconduct to urge the trial court to reconsider an eviden-tiary ruling. We see no reason here for the granting of a motion for mistrial. McDonald may have been surprised, but the ruling did not involve any change that we can see in the conduct of the defense, nor did it involve an issue which would involve the defense calling other witnesses. The ruling involved a question of law and any error could be argued on appeal, so we do not see that McDonald’s defense changed in any respect. As will be pointed out, the ruling of the trial court was correct. We conclude there was no prosecutorial misconduct and that jeopardy did not attach. Following this argument, McDonald attacks the ruling of the trial court in admitting into evidence the prior conviction of sexual offenses on his stepdaughter.

McDonald concedes that evidence of prior sexual conduct to show the lustful

disposition of a defendant toward the victim is admissible based on our opinion in Rigsby v. Commonwealth, Ky., 495 S.W.2d 795 (1973); Russell v. Commonwealth, Ky., 482 S.W.2d 584 (1972); Messmear v. Commonwealth, Ky., 472 S.W.2d 682 (1971); and Young v. Commonwealth, Ky., 335 S.W.2d 949 (1960). He argues that a conviction for such acts must not be shown, and it is improper to show that he was imprisoned as a result of the convictions. The rationale of Rigsby, Russell, Messmear and Young is that prior acts of sexual misconduct toward the victim are admissible as tending to prove a lustful disposition toward the victim and that such evidence is competent for the purpose of corroboration and to show design, disposition or intent on the part of the accused. In each instance, it is recognized that this evidence is an exception to the general rule forbidding testimony of other criminal activities. By an extension of this reasoning, it would not be logical to exclude a conviction for such acts; and we are of the opinion that as testimony of such acts may be shown, so may a conviction for such acts.

Ordinarily we are of the opinion that where a conviction may be shown, testimony that the accused spent time in prison and the length of each stay is irrelevant and should not be admitted into testimony. However in the circumstances of this case where the offense occurred the day after McDonald’s release from prison and the date of the conviction being before the jury, we cannot say that McDonald was unfairly prejudiced by this testimony which was so intertwined with the charged offenses that its mention was appropriate in these circumstances.

McDonald’s assertion that a penalty of life without parole is cruel and unusual punishment and that such penalty constitutes sexual discrimination is answered in Green v. Commonwealth, Ky., 556 S.W.2d 684 (1977), and Moore v. Cowan, 560 F.2d 1298 (6th Cir. 1977), and we reject these assertions.

McDonald argues that the trial court erroneously declined to give instructions tendered by him. Among these instructions offered by McDonald was an instruction on “the presumption of innocence.” The United States Supreme Court in Taylor v. Kentucky, - U.S. -, 98 S.Ct. 1930, 56 L.Ed.2d 468 (1978), held that on the facts of that case, failure to give a “presumption of innocence” instruction violated Taylor’s right to a fair trial as guaranteed by the Due Process Clause of the Fourteenth Amendment. Here the trial court gave an instruction on “the presumption of innocence,” and in our opinion the instruction given satisfied the requirements of Taylor.

We are of the further opinion that the refusal to give the other tendered instructions was not error.

The other assignment of error does not merit discussion.

The judgment is affirmed.

All concur.

      . Offenses committed prior to the effective date of the new Kentucky Penal Code.