author: PHILLIPS, Chief Justice.

text:
    The FIRST NATIONAL BANK OF FORT WORTH, a National Banking Association, Appellant, v. Bob BULLOCK, Comptroller of Public Accounts, State of Texas, et al., Appellees.
    No. 12987.
    Court of Civil Appeals of Texas, Austin.
    July 11, 1979.
    Rehearing Denied Aug. 1, 1979.

      S. G. Johndroe, III, Cantey, Hanger, Gooch, Munn & Collins, Fort Worth, for appellant.
    Mark White, Atty. Gen., Connie Ode, Asst. Atty. Gen., Austin, for appellees.
   PHILLIPS, Chief Justice.

This is a sales tax case. Appellant seeks to recover certain sums paid to appellees under protest by virtue of the Limited Sales, Excise and Use Tax Act, Tex. Tax.Gen.Ann. art. 20.01, et seq. (1969). Suit was brought contending that appellees improperly levied taxes (1) on payments made by appellant to four computer software companies for the licensing of appellant to use certain information contained in tapes to be used in programming appellant’s computer, and (2) on payments made by appellant to Canteen Corporation for providing a free food service to appellant’s employees and guests at appellant’s cafeteria located at its place of business.

Following trial to the court, the court held that appellant was not entitled to recover its tax payments under either of the situations noted above and rendered judgment for appellees. Appellant then perfected its appeal to this Court.

We reverse and render the judgment of the trial court in part and affirm in part.

I.

Appellant seeks recovery of taxes paid under protest on payments it made to four computer software companies for the licensing of appellant to use certain information. Appellant paid over $109,000.00 for four programs or sets of instructions (“computer software”) which enabled appellant’s computer to perform deposit and lending functions and process general accounting. The software was contained on magnetic tapes, probably four in number, but the testimony showed that the information could have been transmitted by keypunch cards, telephone or various other methods.

The law places a tax on a sale of tangible personal property. Tangible personal property is defined as “personal property which may be seen, weighed, measured, felt or touched, or which is in any other manner perceptible to the senses.” Tex. Tax.-Gen.Ann. art. 20.01(P) (1969). To determine whether a sale is of tangible or intangible property, the courts apply the “essence of the transaction” test. Bullock v. Statistical Tabulating Corp., 549 S.W.2d 166 (Tex.1977). If the object or essence of the sale is intangible property, then the transaction is not taxable. We hold the essence of this transaction was not the four tapes, but, instead, the purchase of the computer process, an intangible.

An important factor to be considered in arriving at this determination is the fact that the desired information could have been transferred in several different ways. Id.; Williams and Lee Scouting Service, Inc. v. Calvert, 452 S.W.2d 789 (Tex.Civ.App.1970, writ ref’d). Some of the possible methods would not have involved a tangible object at all. For example, appellant’s computer could have been programmed over the telephone or by hand.

In Statistical Tabulating, the Court held that processed data contained in a coded computer card was an intangible and not taxable. In Williams and Lee Scouting, statistical data on oil and gas well production was compiled and mailed to subscribers in printed reports each week. The sale was not taxed. The purchasers in both Williams and Lee Scouting and Statistical Tabulating were desirous of something beyond the tangible object involved in the transaction. Unlike a phonograph record or filmstrip, when the information on the tape, in the present case, is transferred to the computer, the tape is no longer of any value or importance to the user. State v. Central Computer Services, Inc., 349 So.2d 1160 (Ala.1977); Commerce Union Bank v. Tidwell, 538 S.W.2d 405 (Tenn.1976).

Appellee contends that this case is distinguishable from Statistical Tabulating in that the software in the latter case was “customized,” because it was developed specially for the purchaser. The tapes in our case are “canned” programs, since they are standard items sold to numerous customers with only slight modifications to conform to each purchaser’s use. Appellee argues that the service characteristic is present only with “customized” programs. We do not agree that this is a valid distinction. The test in each case is not whether the product is “customized” or “canned,” but whether the object of the sale is tangible personal property. See District of Columbia v. Universal Computer Associates, Inc., 151 U.S. App.D.C. 30, 465 F.2d 615 (1972). See also Commerce Union Bank v. Tidwell, supra. In Williams and Lee Scouting, the weekly report of oil and gas data was a “canned” publication in that the same information was mailed to many subscribers. There was no service performed for any of the customers that was different from that obtained by all the rest of the subscribers.

Any ambiguity which arises in a particular case must be resolved in favor of the taxpayer, because a taxing statute must be construed strictly against the taxing authority and liberally in favor of the person sought to be held. Bullock v. Statistical Tabulating Corp., supra; Wilson Communications, Inc. v. Calvert, 450 S.W.2d 842 (Tex.1970).

We hold that although tangible personal property, i. e., tapes, did change hands, the sale of a license for computer software to appellant was the sale of intangible 'property, and, therefore, not taxable. The judgment of the trial court is reversed and judgment here rendered that appellant recover the taxes levied on sale of computer software, together with interest as provided by law.

II.

With respect to the second question concerning payments made by appellant to Canteen Corporation, we hold that the tax in question was due and affirm the judgment of the trial court in this respect.

• Appellant entered into an agreement with Canteen Corporation for it to prepare meals for appellant’s employees and guests at appellant’s place of business using appellant’s cooking and serving equipment. These meals were to be furnished free to the employees and guests. Canteen Corporation purchases the food products and prepares and serves them.

Appellant contends that Canteen Corporation was its agent and that no sales tax was generated in a transaction in which appellant’s employees were given meals without cost.

The trial court held that Canteen Corporation operated in all aspects of its relationship with appellant as an independent contractor, appellant having only limited control over Canteen’s operation of appellant’s cafeterias. The court also held that, consequently, the sum of money paid by appellant to Canteen Corporation in return for Canteen’s preparation and serving of food to appellant’s officers, employees, and guests constituted a sale at retail of tangible personal property, taxable pursuant to the Limited Sales, Excise and Use Tax Act. Tex. Tax.-Gen.Ann. art. 20.01, et seq. (1969). We affirm this holding.

The Act imposes a limited sales tax “on the receipts from the sale at retail of all taxable items within this state.” Art. 20.02. In Article 20.01(1) a “sale at retail” is defined as “[a]ny sale of a taxable item.” Article 20.01(K)(2) in turn defines “sale” so as to include “the furnishing, preparing or serving for a consideration of food, meals, or drinks.” “Taxable items” means “tangible personal property.” Art. 20.01(W). “ ‘Receipts’ means the total amount of the sale or lease or rental price ... of the retail sales of taxable items by retailers, valued in money, whether received in money or otherwise. . . . ” Art. 20.-01(D)(1). In this case the tangible personal property consisted of food, meals and drinks, the sale of which consisted of the furnishing, preparing and serving of these items for a consideration. Automatic Canteen Co. v. State Board of Equalization, 238 Cal.App.2d 372, 47 Cal.Rptr. 848 (1965).

The facts of this case do not support appellant’s contention that Canteen Corporation was at once agent and independent contractor. Inasmuch as Canteen Corporation was engaged in a single enterprise: namely, the furnishing, preparing, and serving of food, meals and drinks to appellant’s employees and guests; and, inasmuch as Canteen Corporation retained the day-today control over the enterprise, it was an independent contractor making sales at retail of tangible personal property. The Texas cases stress the right of control. Where one has the right to control the end sought to be accomplished but not the means and details of the accomplishment; that is, only what shall be done, not how it shall be done, the person employed acts as an independent contractor and not as an agent. See Truck Insurance Exchange v. Cartmill, 385 S.W.2d 277 (Tex.Civ.App.1964, writ ref’d n. r. e.); W. D. Haden Co. v. Ryman, 362 S.W.2d 133 (Tex.Civ.App.1962, writ ref’d). An employer who exercises only such control over an independent contractor as is necessary to insure performance of the contract, in order to accomplish the results contemplated by the parties, does not thereby make the contractor an employee of the company. J. A. Robinson Sons, Inc. v. Ellis, 412 S.W.2d 728 (Tex.Civ.App.1967, writ ref’d n. r. e.). Even an occasional assertion of control by the employer does not destroy the settled relationship between the parties. Newspapers, Inc. v. Love, 380 S.W.2d 582 (Tex.1964).

The test in cases of an alleged disregard of a written contract that indicates on its face an employer-independent contractor relationship (as we have in the case at bar) is whether the employer in fact assumed and exercised such detailed control over the performance of the work so as to make the other party a servant. Mid-Continent Freight Lines, Inc. v. Carter Publications, Inc., 336 S.W.2d 885 (Tex.Civ.App.1960, writ ref’d).

Consistent with these tests; we hold that Canteen Corporation was an independent contractor and that the charge for its services is subject to the sales tax. Appellant offers as proof of an agency relationship the fact that Canteen Corporation was required by appellant to purchase some food products from customers of appellant. The contract between appellant and Canteen authorizes appellant to designate the hours of operation, and further states: “Canteen shall cooperate at all times with the owner in determining operating policies of the business conducted by Canteen hereunder, including wage scales, selling price of foods, portions, menus and recipes.” (Emphasis added). Appellant owned the equipment used by Canteen.

The testimony also reflects that Canteen had control over the day-to-day details; Canteen hired all kitchen employees and paid them; Canteen purchased all necessary licenses; Canteen replaced any worn-out items; and that Canteen kept all day-to-day records.

We hold that the consideration paid by appellant to Canteen for furnishing, preparing and serving meals is taxable. Appellant relies on Szabo Food Service, Inc. v. State Board of Equalization, 46 Cal.App.3d 268, 119 Cal.Rptr. 911 (1975). In Szabo, the employees paid for their meals, which were furnished by Szabo Food Service, Inc. The employer subsidized any losses of the caterer. The subsidies were held not taxable because they were not the consideration for the meals, but merely a guarantee of a reasonable profit. The only consideration was provided by the employees who paid for the meals. The present case is distinguishable in that the only consideration was provided by appellant.

The judgment of the trial court is reversed and rendered in part, and, in part, affirmed.


source: Caselaw Access Project

author: O’QUINN, Justice.

license: Public Domain

text:
    Jack Clayton KIDD, Appellant, v. Rotha Carolyn KIDD, Appellee.
    No. 12859.
    Court of Civil Appeals of Texas, Austin.
    July 11, 1979.
    Rehearing Denied Aug. 1, 1979.

      Samuel D. McDaniel and William R. Travis, McDaniel & Travis, Austin, for appellant.

      John F. Campbell, Campbell & Davidson, Austin, for appellee.
   O’QUINN, Justice.

Respondent Jack Clayton Kidd in a divorce action below has appealed from the trial court’s judgment by which respondent was ordered to execute a promissory note in the principal amount of $30,000 payable to Petitioner Rotha Carolyn Kidd over a period of five years. Appellant contends that (1) the note amounts to payment of alimony after the final decree of divorce and (2) even if not alimony, the note results in such an inequitable division of the community estate as to constitute abuse of discretion by the trial court.

The principals in this lawsuit were married in June of 1961. After two failures for the wife to carry a child to full gestation and loss of a third child who was stillborn, the parties adopted two children, a male child born in January of 1967 and a female child born in September of 1969.

After two temporary separations, the first beginning in April of 1976, the wife filed suit for divorce alleging the marriage had become insupportable and seeking division of the community estate and custody of the two children.

The issue of custody of the children was tried before a jury. After extensive testimony, in the course of which the wife’s extramarital intimacies with other men were disclosed, the jury found, “considering only the best interests of the children,” that the father should be appointed their managing conservator. The trial court in conformity with the jury’s finding later awarded custody to the father.

A separate hearing, before the court without a jury, was held with respect to the value and ultimate division of the community estate. It is from the court’s order, resulting from the hearing on property issues, that appellant seeks review before this Court.

Appellee urges that appellant accepted benefits of the judgment affecting property and is therefore estopped to appeal. The trial court ordered the homestead sold, with the net proceeds, after discharge of debts traceable to the property, to be “divided equally among [s/c] the Respondent and the Petitioner.” Appellee contends that appellant “voluntarily accepted benefits of the trial judgment by accepting a share of the proceeds from the sale of the homestead,” and therefore is estopped to appeal under the general rule stated in Carle v. Carle, 149 Tex. 469, 234 S.W.2d 1002, 1004 (1950), that “A litigant cannot treat a judgment as both right and wrong, and if he has voluntarily accepted the benefits of a judgment, he cannot afterward prosecute an appeal therefrom.”

The Supreme Court in Carle recognized certain exceptions to the rule and stated, “Where an appellant accepts only that which appellee concedes, or is bound to concede, to be due him under the judgment he is not estopped to prosecute an appeal which involves only his right to a further recovery.” In his appeal appellant prays that the judgment be reformed to vacate the order requiring execution of the note for $30,000, and in effect that the judgment as reformed be affirmed.

It appears undisputed that both parties, while before the trial court, recognized that sale of the homestead, payment of debts traceable to it, with equal distribution to the husband and wife of the next proceeds, provided an expeditious approach to ultimate division of the community estate. The principal and foremost contest on appeal concerns the requirement that appellant execute a note for $30,000, secured by 33 acres of land awarded appellant under the judgment, which appellant contends is either alimony, or, if not alimony, then an unequal division of the estate.

Although appellant brings twelve points of error, the main thrust of his attack on the judgment is directed to the court’s order that appellant execute the note for $30,-000. Appellant takes the position that if relief be granted under the first point, that is, if it be held that payment of the $30,000 note is payment of alimony and therefore against public policy, then appellant “will waive the other points in this brief.”

Sale of the homestead was upon order of the court, and distribution of the proceeds was ordered by the court in a specific series of priority. No steps were voluntarily made by appellant, but only in compliance with the order of the court. Remand on the grounds urged would not affect appellant’s right to the benefits accepted from sale of the homestead.

We conclude appellant’s right to appeal falls under the exceptions recognized in Carle v. Carle, supra; Wallace v. Wallace, 371 S.W.2d 918, 919 (Tex.Civ.App. San Antonio 1963, writ dism’d); Haggard v. Haggard, 550 S.W.2d 374, 376 (Tex.Civ.App. Dallas 1977, no writ); Coplin v. Coplin, 579 S.W.2d 278 (Tex.Civ.App. Dallas 1979, no writ), and other cases cited.

Appellant contends that the portion of the trial court’s judgment requiring appellant to execute a note for $30,000, payable in installments to appellee over a period of years, constitutes an order to pay alimony in contravention of statutes and public policy of this state. After reviewing definitions of alimony and the case law pertaining to alimony, the Supreme Court in 1967 stated: “When its true meaning is distilled from the statutes and the court decisions of this State, alimony which contravenes the public policy of the State is only those payments imposed by a court order or decree on the husband as a personal obligation for support and sustenance of the wife after a final decree of divorce.” Francis v. Francis, 412 S.W.2d 29, 33 (Tex.Sup.1967).

Monetary payments by one party to the other after divorce may be required by the trial court if the payments are referable to rights and equities of the parties in and to property at the time of dissolution of marriage, and such payments and division will not be regarded as allowance of alimony in violation of public policy. Garrett v. Garrett, 534 S.W.2d 381, 382 (Tex.Civ.App. Houston (1st) 1976, no writ); In Re Marriage of Jackson, 506 S.W.2d 261, 267 (Tex.Civ.App. Amarillo 1974, writ dism’d); Marks v. Marks, 470 S.W.2d 83, 86 (Tex.Civ.App. Tyler 1971, writ ref’d n.r.e.). In the case now under review a certain 33.33 acres of land, purchased under the Veterans Land Board program during the marriage, and awarded to appellant by the trial court, appears to be the property to which the trial court made the $30,000 note referable.

The trial court, in paragraph 6(0) of the judgment, listed the 33.33 acres of land as community property of the parties, and earmarked the tract as “being generally re-fered [sic] to in these proceedings as the Friday Mountain Acres . . . ” The Friday Mountain Acres were awarded to appellant by the court (as item 6 of that award), and in item 7 of property awarded to appellee the court described the $30,000 note and provided that it be “secured by Respondent’s interest in the Friday Mountain Acres.” Thereafter in the judgment the court added an order that respondent execute and deliver the note dated December 30, 1977.

At the hearing before the court on property values and division appellant testified that the Friday Mountain Acres might be “evaluated anywhere from a thousand to fifteen hundred to eighteen hundred [dollars per acre],” depending on the market. In response to the inquiry, “Is this property for sale?” appellant testified, “No, it will never be sold. It is part of a family estate that will never be sold,” referring to adjacent land owned jointly by appellant and his brothers, together with adjacent land owned by their parents. If the trial court accepted appellant’s highest figure, or $1,800 per acre, the total tract of 33.33 acres could have been valued at $59,994.00. The note for $30,000.00 would constitute approximately one-half of that total value.

We hold that the note for $30,000 is so directly referable to property of the community estate, and to division of property by the court, that the note cannot be regarded as allowance for alimony in violation of public policy of this state.

In the nature of an alternative contention, appellant insists that “If it [the note] is not alimony, it causes the property division to be unjust.” Under points of error two through five, appellant urges that, in exercise of discretion allowed trial courts, the court made “an unequal division of the community estate and as a result abused its discretion by awarding the wife substantially more than her half of the community estate,” and that the court erred in specified findings of fact essential to support division made of the property.

Since 1841 trial courts in Texas have been empowered “ . . .in pronouncing a decree of divorce, to order a division of the estate of the parties to the divorce suit in such way as to the court seemed just and right, having due regard to the rights of each party and of the children . . .” Hedtke v. Hedtke, 112 Tex. 404, 248 S.W. 21 (1923). The present statute, Section 3.63, Texas Family Code, is essentially the same as enacted in 1841. In Hedtke the Supreme Court held: “Its language [of the statute] ought to be given the meaning uniformly ¿scribed to it by this court, and that is, that the court pronouncing a decree of divorce is invested with wide discretion in disposing of any and all property of the parties, separate and community, and that its action, in the exercise of such discretion should be corrected on appeal only where an abuse of discretion is shown in that the disposition made of some property is manifestly unjust and unfair.” (248 S.W. 23).

In 1974 the Supreme Court, after quoting Section 3.63 in full, again stated the rule of Hedtke in this language:

“Texas Courts have held that such division does not have to be equal, and appellate courts have held it must be presumed that the trial court exercised its discretion properly, and that a case should be reversed only where there is a clear abuse of discretion. In the case of In re Marriage of McCurdy, 489 S.W.2d 712 (Tex.Civ.App. Amarillo 1973, writ dism.), the court held that equity required an unequal division of the community property be made. It is well established that Texas divorce courts are given wide discretion in making division of the property of the parties. That discretion will not be disturbed on appeal unless the court has clearly abused its discretion. Hedtke v. Hedtke, 112 Tex. 404, 248 S.W. 21 (1923).” Bell v. Bell, 513 S.W.2d 20, 22 (Tex.Sup.1974).

In McCurdy, noted by the Supreme Court in Bell, the court restated the rule that “The trial judge is not required to divide community property equally . .” (489 S.W.2d 717, col. 1). Appellant did not have an absolute right to one-half of the community property. Mahrer v. Mahrer, 510 S.W.2d 402, 404 (Tex.Civ.App. Dallas 1974, no writ); Miller v. Miller, 463 S.W.2d 477, 480 (Tex.Civ.App. Tyler 1971, writ ref’d n.r.e.).

In the present case the trial court filed findings of fact and conclusions of law. Appellant complains of findings 7 and 8, and the conclusions related to these findings, by which findings the court concluded (1) division of the community estate found in the judgment “is just and right, having due regard for the rights of each party and the children adopted of the marriage,” and (2) “such division is manifestly fair and equitable to both parties.” Appellant also urges error in the finding that appellee’s gross income at the time of divorce was $7,200 annually and that she has little opportunity for advancement; and error in the finding that appellant “owned substantial separate property at the time of dissolution of the marriage.”

The record shows that at the time of trial appellee was employed at Durham Business College at a salary of $7,200 per year, and that appellant, as a medical doctor practicing in pediatrics, had a gross annual income of $60,000, plus certain fringe benefits. Appellant testified that he owned as his separate property an undivided one-third interest in a tract of 75 acres of land in the Friday Mountain Ranch properties, in the same area with the 33.33 acres known as Friday Mountain Acres. If the court believed the 75 acres to have a per acre value equal to the top value appellant placed on the 33.33 acres, the jointly owned tract would be worth about $135,000, and appellant’s interest would amount to about $45,-000. The term “substantial” separate property, as used by the court, is relative, but separate property worth $25,000 (at appellant’s lowest figure of $1,000 an acre) or $45,000 (at $1,800 an acre) can hardly be termed “insubstantial.” The record shows, and the court found, that appellee owned no separate property at the time of dissolution of the marriage.

The record also shows, and the trial court found, that appellant is in good health, whereas appellee has an incurable disease (lupus, a cutaneous disease occurring in several forms), which was in remission at the time of trial, and by appellee’s testimony had been in remission eight years or more. Appellee has no insurance covering hospitalization in event of recurrence of lupus. Appellant testified at trial that his wife’s ailment “is typically a type of disease that becomes chronic with occasional flare-ups and remission,” and that although some “patients just lead a perfectly normal life, with occasional flare-ups,” to other “patients, it can be very devastating . . . ”

Appellant complains that the court’s judgment places the burden of child support entirely on him, and that no weight seems to have been given, in dividing the property, to the evidence that appellee was at fault, by her personal conduct, in bringing about separation and eventual divorce of the couple. Appellant sought and obtained custody of the two children, and as managing conservator of the minors appellant retains the rights and duties of a parent, to the exclusion of the other parent, subject to rights and duties granted the possessory conservator. (Secs. 14.02, 14.04, Family Code). The action in trial, by which appellant became the managing conservator, was taken, as required by statute, “considering only the best interests of the children.” The fault of one party in breaking up the marriage is not alone a controlling factor in arriving at a just division of the community property. A trial court may take into consideration a number of things, including the matters already referred to as shown by the record. Miller v. Miller, supra, 463 S.W.2d 477, 480; In Re Marriage of Jackson, 506 S.W.2d 261, 266 (Tex.Civ.App. Amarillo 1974, writ dism’d).

In reviewing action of the trial court dividing the community estate in a divorce case, and in deciding whether the trial court abused its discretion, the appellate court will consider the evidence as a whole, with all reasonable inferences and deductions that can be properly drawn therefrom considered in the light most favorable to appellee. Womble v. Womble, 502 S.W.2d 886, 889 (Tex.Civ.App. Fort Worth 1973, no writ). The reviewing court indulges a presumption in favor of the trial court’s exercise of its discretion regarding division of property in a divorce action. Waggener v. Waggener, 460 S.W.2d 251 (Tex.Civ.App. Dallas 1970, no writ); Cusack v. Cusack, 491 S.W.2d 714, 721 (Tex.Civ.App. Corpus Christi 1973, writ dism’d).

Guided by the rules we believe to be firmly established in a long and reasonably consistent growth of case law, respecting exercise of discretion by trial courts in dividing property in the course of a divorce action, we fail to find a showing that the trial court abused its discretion in this cause. It may be true in some instances that an appellate court, given the power vested in the trial court to exercise discretion initially, might reach a different result. But an appellate court is limited to review, to determine whether the trial court, considering the evidence as a whole, exercised its discretion without abuse in dividing property between the parties, as required under Section 3.63 of the Family Code.

We have examined with due care points of error six through twelve, together with argument and authorities presented under the points by appellant, and fail to find in these contentions merit sufficient to require reversal of the trial court’s judgment. The points are overruled.

The judgment of the trial court is affirmed.

Affirmed.


text:
    Margarito RODRIGUEZ, Appellant, v. Guy MORGAN, d/b/a Guy Morgan Construction Company, Appellee.
    No. 12902.
    Court of Civil Appeals of Texas, Austin.
    July 11, 1979.
    Rehearing Denied Aug. 1, 1979.
    Bob Andrews, Austin, for appellant.
    Wayne H. Prescott, Brown, Maroney, Rose, Baker & Barber, Austin, for appellee.
   O’QUINN, Justice.

Margarito Rodriguez brought this suit in 1974 naming as defendants Guy E. Morgan, doing business as Guy E. Morgan Insurance (sic) Company, Jesse Del Torro, individually, and two insurance companies, for injuries claimed to have been sustained in November of 1973 as a workman on a construction project in Austin.

This appeal is from summary judgment, granted on motion of Morgan, that Rodriguez take nothing from Guy Morgan, doing business as Morgan Construction Company. Subsequent to judgment, the trial court ordered severance as to Morgan, and declared the judgment final, from which Rodriguez has appealed.

Appellant brings the single point that it was error to grant the summary judgment and thereafter sever the cause “ . rendering said judgment between them [the parties] for finality; because the record below raises complete material issues of negligence attributable to appellee in appellant’s action brought against appellee.”

Morgan’s motion for summary judgment rested on three grounds: (1) that if Rodriguez was an employee of Morgan, the general contractor, Morgan was immune from liability on negligence ground because the contractor had in effect a policy of worker’s compensation insurance; (2) that Rodriguez was an employee of the subcontractor, and no relationship existed between Morgan, as the general contractor, and Rodriguez; and (3) that Morgan committed no act of negligence that was a proximate cause of the accident in which Rodriguez was injured.

Morgan filed appellee’s brief in November of 1978, and under the initial counterpoint sought affirmance “because the trial court may have based its judgment on a ground not saved for appellate review,” in reliance on the rule stated by the Supreme Court in Malooly Brothers, Inc. v. Napier, 461 S.W.2d 119, 121 (Tex.Sup.1970).

All issues raised by the briefs, including appellee’s first counterpoint, were orally argued at the time of submission on March 7, 1979. Thereafter, on April 11, appellant filed with this Court motion “for technical amendment and supplementation of original appellant’s brief,” which brief had been filed October 10, 1978. We now consider, and will overrule the motion to amend.

It is clear from appellant’s brief that his appeal rested entirely on the contention that Morgan was guilty of negligence proximately causing the injuries to appellant, who fell with collapse of scaffolding neither owned nor furnished by Morgan. Appellant argued, “The very nature of a personal-injury (sic) case makes suspect a summary judgment against a plaintiff. The inquiry in this appeal is quite narrow . Does the record present any possibility of issues as to whether appellee, in any capacity, could be deemed liable for negligently and proximately causing appellant’s injuries and damages?”

The entire brief, consisting of more than twenty pages, is devoted exclusively to an attack upon the summary judgment on the ground that Morgan committed some act of negligence that was a proximate cause of the accident in which Rodriguez was injured. In conclusion, appellant asserts, “Hence, based upon several approaches to negligence theories, Appellant has demonstrated that the record did indeed raise genuine issues of material fact, thus necessitating trial and making the summary judgment improper.”

By amendment of the brief, appellant seeks to present five points of error which would change his grounds to incorporate at least four other and additional theories for reversal of the trial court’s judgment, but none of which appellant undertakes to brief and support by authorities. This effort comes six months after filing appellant’s brief, nearly five months after challenge of appellant’s grounds in the brief appellee filed, and more than one month after submission and oral argument, at which time the same issue was argued by both parties.

Although Rule 431, Rules of Civil Procedure, permits briefs to be amended or supplemented “when justice requires upon such reasonable terms as the court may prescribe,” and should be liberally construed, the Rule “ . . . should not be so liberalized or extended so as to permit an appellant to completely change his grounds after submission of an appeal in the absence of most extraordinary circumstances.” King v. Cron, 285 S.W.2d 833, 834 (Tex.Civ.App.San Antonio 1955, writ ref’d n. r. e.), cert. den., 352 U.S. 843, 77 S.Ct. 67, 1 L.Ed.2d 59 (1956). The rules should be given an interpretation which will further, and not impede, the orderly disposition of the cause on appeal. Stuart v. Coldwell Banker & Company, 552 S.W.2d 904 (Tex.Civ.App. Houston (1st) 1977, writ ref’d n. r. e.).

Appellant’s motion for leave to file the amended brief, which completely changes grounds of the appeal more than a month after submission, is, after due consideration, overruled as not in furtherance of orderly disposition of the cause.

Returning to appellee’s first counterpoint, we conclude that the contention is valid that summary judgment of the trial court should be affirmed. It is apparent that the trial court may have based the summary judgment on a groiind not specifically challenged by appellant. Appellant has failed to assign error, or to brief, the several grounds upon which the court, in response to appellee’s motion for judgment, granted summary judgment, and for this reason the summary judgment should be affirmed. Malooly Brothers, supra, 461 S.W.2d 121, col. 2, and other authorities there cited.

Judgment of the trial court is affirmed.


author: COUNTISS, Justice.

text:
    NEW HAMPSHIRE INSURANCE COMPANY, Appellant, v. The BANK OF the SOUTHWEST, Appellee.
    No. 9006.
    Court of Civil Appeals of Texas, Amarillo.
    July 11, 1979.
    Rehearing Denied Aug. 1, 1979.

      Law Offices of Walter P. Wolfram, Catherine E. Brown, Amarillo, for appellant.
    Lumpkin, Watson, Barras & Reavis, Don H. Reavis and Richard L. Hanna, Amarillo, for appellee.
   COUNTISS, Justice.

New Hampshire Insurance Company appeals a judgment denying it recovery as subrogee of Imperial Savings Association of Amarillo, the drawer of a subsequently altered check drawn on Imperial’s checking account at the First National Bank of Amarillo, Texas, and cashed by the Bank of the Southwest. We affirm the judgment of the trial court.

In June and July of 1976, two employees of Imperial, in cooperation with other persons not Imperial employees, appropriated a substantial sum of Imperial’s money by altering and forging checks on Imperial’s checking account. One of those altered checks is the subject of this ease.

On July 14, 1976, Brenda K. Robison, one of the non-employees involved in the scheme and a depositor at the Bank of the Southwest presented an Imperial check drawn on the First National Bank of Amarillo, dated July 7, 1976, payable to B. K. Robison in the sum of $4,623.75, to a teller at the Bank of the Southwest and asked for cash. The teller, observing that typewriter correction fluid had been used on the check and the payee’s name typed over the correction fluid, took the check to one of the bank officers before cashing it. After a conversation with the officer, the teller called Imperial’s office to verify the check and, at Robison’s direction, asked for “Cathy” or “Jan.” The teller spoke with “Cathy” who advised her that the check did belong to B. K. Robison. Thereafter, the check was cashed and the cash given to B. K. Robison.

The Bank of the Southwest processed the check through the clearing house and it was duly presented to the First National Bank of Amarillo on July 15,1976. First National Bank of Amarillo paid the check to the Bank of the Southwest with its own funds, then deducted that sum from the checking account of Imperial on the same day.

Subsequently, on July 20, 1976, the scheme was discovered by Imperial and New Hampshire Insurance Company, Imperial’s bonding company, was notified. The insurance company eventually paid a substantial portion of Imperial’s loss, including this check, and took an assignment from Imperial of any recovery rights Imperial might have. The insurance company recovered part of its loss by settlement with First National Bank of Amarillo and, as a part of the settlement, agreed not to seek recovery from First National Bank of Amarillo on the check in question. However, the insurance company took no assignment of rights in the check from First National Bank of Amarillo. The insurance company then filed this suit against the Bank of the Southwest.

The insurance company attacks the judgment of the trial court on four points of error, contending that the Bank of the Southwest is accountable to the insurance company for the proceeds of the check under section 3.304(a)(1), Tex.Bus. & Com. Code Ann. (Vernon 1968); that the findings of fact and conclusions of law are not supported by the evidence or are against the great weight and preponderance of the evidence; that the trial court erred in failing to make the findings of fact and conclusions of law requested by the insurance company and that the insurance company is entitled to prejudgment interest. In view of our disposition of the case, only the first point of error will be discussed.

The insurance company’s only affirmative theory of recovery in this Court is based on section 3.304(a)(1), Tex.Bus. & Com.Code Ann. (Vernon 1968). As pertinent here, that section reads as follows:

(a) The purchaser has notice of a claim or defense if
(1) the instrument . . . bears such visible evidence of . alteration . . . as to call into question its validity, terms or ownership or to create an ambiguity as to the party to pay .

It is the insurance company’s position that the Bank of the Southwest was put on notice of a claim or defense as to the subject check because of the alteration visible on the face of the check, that it knew the check was altered before cashing it and that, with this knowledge it obtained money by means of the altered check from the account of Imperial and is liable to the insurance company, Imperial’s subrogee, for the money.

We are thus presented with the narrow question of whether the insurance company is entitled to recover the amount of the check from the Bank of the Southwest solely because the Bank may have had notice of the alteration of the check. We answer that question in the negative.

The defect in the insurance company’s position is that section 3.304(a)(1) does not, standing alone, establish a substantive cause of action. By its terms, the section is a “notice” section and the sub-section in question is the starting point for determining the posture that will be occupied by the purchaser of an altered instrument in the event of a dispute concerning the instrument. See White & Summers, Uniform Commercial Code, § 14-6 (1972). If the purchaser comes within its provisions, it will be denied the favored status of a holder in due course. However, an initial determination that the purchaser is charged with notice of a claim or defense, and thus not a holder in due course, does not automatically resolve the question of liability. If a claim is being asserted on an instrument against a holder, the entity asserting the claim must, after establishing the “holder” status, factually and legally establish a recognized cause of action against that holder. Of course, denial of holder in due course status makes the holder much more vulnerable when a recognized cause of action is asserted against it, but it does not give the claimant a blank check signed by the holder. Compare sections 3.305 and 3.306, Tex.Bus. & Com.Code Ann. (Vernon 1968).

In the posture of the case now before us, it is immaterial whether the Bank of the Southwest is a holder or a holder in due course because the insurance company does not assign by point of error or present any theory in this court that would justify recovery against the Bank of the Southwest in either capacity. Absent an assignment of error bringing forward a recognized theory of recovery, this court can grant no relief to the insurance company. State Farm Mutual Automobile Ins. Co. v. Cowley, 468 S.W.2d 353, 354 (Tex.1971).

In similar cases, various theories have been asserted, with varying degrees of success, under the warranties contained in section 4.207, Tex.Bus. & Com.Code Ann. (Vernon 1968) and under common law theories preserved by section 1.103, Tex.Bus. & Com. Code Ann. (Vernon 1968). However, the insurance company in its brief expressly disclaims any reliance on section 4.207 and did not plead a common law theory of recovery in the trial court.

In summary, the insurance company has not preserved in this court any theory that gives it a cause of action against the Bank of the Southwest under the undisputed facts of this case. Having made that determination, discussion of the insurance company’s remaining points of error is unnecessary.

The judgment of the trial court is affirmed.

      . The Imperial employees involved in the scheme were Jan Moser and Catherine McMillan. Brenda K. Robison was the roommate of Jan Moser. The statement of facts indicates that Robison told the teller to ask for “Cathy” or “Jan” because they had waited on her but the evidence does not further identify “Cathy” and “Jan.”

      . The holder in due course has been referred to as “Superplaintiff.” White & Summers, supra, § 14-1.

      . See Central Cadillac, Inc. v. Stern-Haskell, Inc., 356 F.Supp. 1280 (S.D.N.Y.1972); Life Insurance Company of Virginia v. Snyder, 141 N.J.Super. 539, 358 A.2d 859 (1976); Stone & Webster Eng. Corp. v. First National B. & T. Co., 345 Mass. 1, 184 N.E.2d 358 (1962).

      . See United States Fidelity & Guaranty Co. v. First Nat. Bank, 93 S.W.2d 562 (Tex.Civ.App.— El Paso 1936, writ dism’d by agr.); Intemational Industries, Inc. v. Island State Bank, 348 F.Supp. 886 (S.D.Tex.1971).


author: PRESSLER, Justice.

text:
    METROL CORPORATION, Appellant, v. TECHNICAL SALES, INCORPORATED, Appellee.
    No. A2076.
    Court of Civil Appeals of Texas, Houston (14th Dist.).
    July 11, 1979.

      Jerry D. Conner, Conner & Dreyer, Houston, for appellant.
    William B. Adair, Byrnes, Myers, Adair, Campbell & Sinex, Houston, for appellee.
    Before MILLER, PRESSLER and SALAZAR, JJ.
   PRESSLER, Justice.

This is an appeal from a judgment rendered in favor of Technical Sales, Inc. (ap-pellee) for monies due under a commission sales contract entered into with Metrol Corporation (appellant). The contract made the basis of this suit was entered into between the parties hereto in 1973 and specified various commissions payable to appel-lee derived from transactions in which ap-pellee was to act as exclusive sales agent for appellant’s products. Upon termination of the contract and refusal by appellant to pay commissions alleged to be due under the contract, appellee brought suit.

The case was tried without a jury, and at the close of the evidence the trial court ruled in favor of appellee, awarding both commissions and attorney’s fees. Appellant has perfected this appeal from the trial court’s judgment.

Appellant’s first two points of error concern the trial court’s awarding attorney’s fees. They allege that, there was no evidence of a demand upon a valid claim thirty days prior to trial and that the amount being demanded had been paid in full prior to trial. Appellee’s initial demand for payment was made more than thirty days prior to the filing of the lawsuit. The amount of the initial demand was determined from limited records regarding sales commissions which were in appellee’s possession. From records obtained through pretrial discovery, appellee determined that it was due money on its sales commissions in addition to that amount alleged in its initial demand. Prior to trial, appellant paid the amount initially demanded by appellee.

A plaintiff, in order to recover attorney’s fees under article 2226, Tex.Rev. Civ.Stat.Ann. (Supp.1978-1979), must make a specific demand on a claim to the debtor. El Paso National Bank v. Leeper, 538 S.W.2d 803 (Tex.Civ.App.-El Paso 1976, writ ref’d n. r. e.). Article 2226 states that after thirty days, if the demand has not been paid, the claimant may recover the attorney’s fees incurred in pursuing the claim. The appellee’s initial demand, based on all of the information available to it at the time, was a proper demand for payment. The amount claimed was not paid within the thirty day period after the initial demand. The prerequisites for recovery of attorney’s fees under article 2226 were therefore satisfied. We hold that since these prerequisites were once established, the subsequent payment of the initial demand did not negate the fact that these prerequisites had been established when an additional demand was properly brought within the same lawsuit based upon information which the appellee discovered from the appellant during the course of pretrial discovery. Thus, appellant’s first two points of error are overruled.

Appellant further alleges that there was no evidence, or, in the alternative, insufficient evidence, presented at trial upon which , the trial court could determine the amount of money due under the sales commission contract. Based upon our review of the record, we hold that appellee met its burden of proof at trial by proving its cause of action by a preponderance of the evidence. State v. Turner, 556 S.W.2d 563 (Tex.1977). Sufficient evidence was presented, and the trial court properly rendered judgment.

Finally, appellant claims that the various business records introduced into evidence at trial by appellee were not properly admitted pursuant to article 3737e, Tex. Rev.Civ.Stat.Ann. (Supp.1978-1979). Upon a proper predicate’s being laid, business records may be admitted as an exception to the hearsay rule under article 3737e, Cooper Petroleum Company v. La Gloria Oil and Gas Company, 436 S.W.2d 889 (Tex.1969). The proper predicate was laid to prove up these business records, and we, therefore, hold such records were properly admitted and considered.

The judgment of the trial court is affirmed.


author:
SALAZAR, Justice.
      MILLER, Justice,

text:
    Woodrow Wilson MIKESKA, Appellant, v. Kelsie Lynda MIKESKA, Appellee.
    No. A2072.
    Court of Civil Appeals of Texas, Houston (14th Dist.).
    July 11, 1979.
    Gordon N. Bynum, Houston, for appellant.
    Reagan S. Redman, Houston, for appel-lee.
    Before MILLER, PRESSLER and SALAZAR, JJ.
   SALAZAR, Justice.

Appellant, Woodrow Wilson Mikeska, petitions for a writ of error from a decree granted in an uncontested divorce action wherein the trial judge decreed that appellant shall pay $400.00 per month as child support. That same decree incorporated an agreed property and custody agreement wherein the parties mutually agreed that appellant-respondent would have no fixed obligation to pay any specific amount as child support but shall provide for the sole minor child as he chooses and sees fit. For the reasons that follow, we reverse and remand.

Appellee-petitioner, Kelsie Lynda Mikes-ka, filed an original petition for divorce on February 1, 19.78. On April 13, 1978, appellant signed a waiver of citation and on that same date, the parties signed a “Property and Marital Rights Agreement.” No signature by an attorney for either party appears on the agreement.

The divorce decree recites that appellee-petitioner appeared with counsel on April 17, 1978, and that appellant-respondent, having filed a waiver of service, failed to appear either in person or by attorney. The divorce was then granted. The divorce decree was later signed by the trial court on April 26, 1978. Again no signature by counsel representing either party is evident on the decree.

In his one point of error, appellant contends that the part of the judgment concerning child support is so vague, ambiguous, and unintelligible as to constitute error as a matter of law. Appellant complains of the order for appellant to pay the sum of $400.00 per month as child support. The trial court at the same time had specifically incorporated by reference into the decree the property and marital rights agreement which contained the following provision: “Respondent shall have no fixed obligation to pay to Petitioner any fixed amount as child support but shall provide for the child as he chooses and sees fit.”

Amicable settlement by parties to a marriage pending a divorce regarding property rights and custody arrangements should be encouraged, not discouraged, and such agreements will then have whatever legal force the law of contracts will give them. Griffin v. Griffin, 535 S.W.2d 42 (Tex.Civ.App. — Austin 1976, no writ). It is the duty of the court to ascertain the intention of the parties to the contract as disclosed by its provisions and the surrounding circumstances. Boyd v. Boyd, 545 S.W.2d 520 (Tex.Civ.App. — Houston [1st Dist.] 1976, no writ). Where the duty to make support payments arises from an agreement between the parties, rather than being created by a divorce decree based entirely upon the power conferred by Texas Family Code, the rights and obligations of the parties are governed by the rules relating to contracts. Robertson v. Robertson, No. B2103 (Tex.Civ.App. — Houston [14th Dist.] June 13, 1979).

A consent judgment which is rendered pursuant to a written agreement becomes a contract between the parties as well as an adjudication between them. The provisions of such a contract, in the absence of fraud, accident or mistake, should not be set aside or modified except by the consent of the parties. Boyd v. Boyd, 545 S.W.2d at 523.

It is apparent to this court that the trial court by finding such agreement to be fair and reasonable and incorporating it into the final judgment of the court, created a fundamental conflict between the child support provision in the agreement and in the judgment rendering the judgment unenforceable in this respect. The parties intended to abide by the child support provision in the property and marital rights agreement and appellant, in reliance on the provision stated in the agreement, signed the agreement and the waiver of citation. This is patent to the court from the agreement and the waiver.

The child support provision in the decree is vague and ambiguous and unenforceable by contempt. The trial court should take appropriate action to clarify this conflict. We reverse and remand to the trial court for proper action and to clarify the apparent conflict.

Reversed and remanded.

MILLER, Justice,

dissenting.

I respectfully dissent. In appellant’s only point of error he complains “. . . the judgment concerning child support payments is so vague, ambiguous and unintelligible as to constitute error as a matter of law by the trial court in ordering appellant to pay the sum of $400.00 per month as child support . . .”. I do not agree with the appellant’s basic contention that there is an irreconcilable conflict in the judgment.

The “Property and Marital Rights Agreement” is expressly divided by numbers into two parts. The first part is entitled “Division of Property.” It makes provision for the division of all real and personal property owned at the time of the divorce. The second part is entitled “Custody and Maintenance of Child.” It fixes the managing and possessory conservatorship of the child as well as attempting to provide for the support of the minor child. The divorce decree recites that:

(f) That the court finds the petitioner and respondent filed an agreed property and custody agreement with the court with the intent that it be incorporated into the final judgment of the court. The court finds the property agreement fair and reasonable.

Based on such findings, it is Decreed and Ordered :

(1) • • •
(2) That the property settlement agreement of the parties be incorporated into this divorce decree as attachment “A”;
(3) That the petitioner is appointed managing conservator of the minor child Angela Lynda Mikeska;
(4) That the respondent be appointed possessory conservator of the minor child Angela Lynda Mikeska;
(5) . . .
(6) Respondent shall pay to petitioner the sum of $400.00 per month as child support. (Emphasis supplied).

Although the Texas Family Code encourages the parties to enter into written agreements concerning conservatorship and support of the child, Tex.Fam.Code Ann. § 14.06(a) (Vernon 1976), it also directs in mandatory language that the best interest of the child shall always be primary in determining these questions. Tex.Fam. Code Ann. § 14.07(a). To accomplish the latter, the trial court is not bound to accept the agreement entered into by the parties but may request them to submit a revision or make its own orders. Tex.Fam.Code Ann. § 14.06(b). In the case before us the trial court, in the exercise of its discretion, expressly chose only to adopt the property and custody provisions of the parties’ agreement. It also expressly found the property agreement to be fair and reasonable. It did not, however, accept or adopt the illusory support provision of no fixed obligation but rather chose to make its own order of $400.00 per month and rightly so. Without extenuating circumstances or other compensatory division of the property, neither of which appear of record, it would have been against public policy not to provide an enforceable support order for the child. Both parents have a duty to support minor children. Tex.Fam.Code Ann. § 12.04(3). This duty should not be lightly terminated without good cause reflected in the record.

The trial court in its findings accepted and incorporated only part of the parties’ written agreement. In its order it then itemized each question which was under its consideration. It reiterated the property and custody provisions it adopted and made its own new orders as to support. The trial court had the discretion to do both. I would affirm the trial court’s judgment.


text:
    George H. CANADA, Appellant, v. Charles G. EZER, Beneficiary, Independent Executor and Trustee Under Last Will and Testament of George R. Canada, Appellee.
    No. A2054.
    Court of Civil Appeals of Texas, Houston (14th Dist.).
    July 11, 1979.
    Rehearing Denied Aug. 1, 1979.
    Taylor Moore, Law Office of Browne & Moore, Alister B. Mahon, Law Office of Minter & Mahon, Houston, for appellant.
    Mark W. Owen, Ernest F. Bogart, Jr., Law Office of Owen, Jones & Bogart, El-gin, for appellee.
    Before MILLER, PRESSLER and SALAZAR, JJ.
   PRESSLER, Justice.

This is an appeal from the district court’s dismissal of George H. Canada’s (appellant) cross-action on the grounds that the district court lacked jurisdiction to void the admission to probate of a will admitted to probate in the county court some twenty years prior, or in the alternative to impose a constructive trust in favor of appellant.

The original will of George R. Canada (Canada) was admitted to probate on December 1, 1958, in the county court of Chambers County. Under the terms of Canada’s will a trust was created with Canada’s widow, Winifred Adair Canada, and Charles G. Ezer (appellee) as co-trustees. Under the terms of the trust Mrs. Canada was the lifetime beneficiary of the trust. Upon Mrs. Canada’s death, the assets of the original trust under Canada’s will went to a second trust with appellee and another as co-trustees. The will called for specific bequests to be made to various individuals from the second trust. The remainder of the trust assets were then to be delivered by the co-trustee to appellee. Both the named co-trustee and the alternate co-trustee refused to serve. The will did not provide for an additional co-trustee, nor did it provide for a method of selection of a co-trustee. This suit was filed in the district court to receive direction for the carrying out of the terms of the trust and for the appointment of a co-trustee.

Appellant, the son of the testator, was a designated beneficiary under the trust, and, therefore, was named as a party to this suit. Appellant filed a cross-action alleging that the will made the basis of this suit was invalid because testator was not of sound mind. He also alleged that the will was obtained through undue influence and fraud and that its execution was faulty. In the alternative, appellant asked the district court to impose a constructive trust in favor of appellant.

Appellee filed a motion to dismiss appellant’s cross-action for want of jurisdiction. Appellee’s motion was heard and granted, and the court appointed a co-trustee to administer the trust. Appellant has perfected this appeal from the dismissal of his cross-action in the district court.

Appellant raises two points of error before this court. In his first point of error, appellant states that the district court under section 5, Tex.Prob.Code Ann. (Supp. 1978-1979), has jurisdiction to rule on the validity of the will. This section does confer probate jurisdiction upon the district court. However, the will which appellant seeks to set aside was admitted to probate more than twenty years ago. The appellant’s cross-action concerning the validity of the will is a collateral attack on the admission of the will to probate by the county court in 1958. The courts have clearly ruled upon such a matter in Wybrants v. Lehman, 307 S.W.2d 339 (Tex.Civ.App.— Eastland 1957, writ ref’d n. r. e.), which held:

Where a probate court has exercised jurisdiction over a decedent’s estate it will be assumed in the absence of a showing to the contrary that facts existed which authorized such action. Under such a situation the probate court’s order may not be collaterally questioned unless the record shows it was without jurisdiction.

Id., at 341 — 42. Appellant has not attacked the jurisdiction of the county court in his appeal. Therefore, his first point of error is overruled.

Appellant’s second point of error raises the issue of whether or not the district court erred in dismissing the part of the cross-action which requested that the district court impose a constructive trust upon the assets of the estate for the benefit of appellant. Section 5 of the Probate Code did broaden the jurisdiction of courts hearing probate matters, but Texas cases have stated that this section does not take away the jurisdiction of the district courts to hear a matter involving a request to impose a constructive trust upon the assets of an estate. Petsch v. Slator, 573 S.W.2d 849 (Tex.Civ.App. — Austin 1978, writ ref’d n. r. e.); Gordy v. Alexander, 550 S.W.2d 146 (Tex.Civ.App. — Amarillo 1977, writ ref’d n. r. e.). The district court in this cause thus had jurisdiction to hear evidence on this matter, but it did not do so. The ruling of the trial court is, therefore, overruled and case remanded to trial court for further proceedings.

Reversed and remanded.


author: OSBORN, Justice.

text:
    Alvin H. PARKER, Appellant, v. The BOARD OF TRUSTEES OF ODESSA JUNIOR COLLEGE et al., Appellees.
    No. 6822.
    Court of Civil Appeals of Texas, El Paso.
    July 11, 1979.
    Rehearing Denied Aug. 8, 1979.

      Gloria T. Svanas, Odessa, for appellant.
    Milburn & Warner, Eben D. Warner, III, Odessa, Shafer, Gilliland, Davis, Bunton & McCollum, Inc., Lucius D. Bunton, Jim Moseley, Odessa, for appellees.
   OPINION

OSBORN, Justice.

This is a tax case involving the evaluation and reassessment procedures used by two taxing entities in Ector County. The two taxing authorities operate a joint tax office with a combined tax roll for coexistent tax districts. The jury found the reassessment plan was reasonable and the trial Court denied all relief to the complaining taxpayer. We affirm.

The Ector County Independent School District and Odessa Junior College have for several years employed the property evaluation firm of Pritchard and Abbott to appraise property within the taxing districts. In 1975, Pritchard and Abbott began a program of reassessing all properties based on their fair market value. The plan of operation was to reevaluate different areas of the tax districts each year and no property was to be reevaluated again until the entire district had been initially reevaluated. During this process, any property involved in new construction would be reevaluated the year the work was performed. Thus, except for new construction, the entire tax district was reevaluated before the cycle would begin anew and before another reevaluation. There were no exact guidelines as to which parts of the tax districts would be reevaluated in any given year. Pritch-ard and Abbott determined how much of the districts could be reevaluated in a particular year, but generally their work was done in adjoining areas from year to year. They began in the northeast part of Odessa and worked in a westerly direction from year to year. The area covered from one year to the next depended upon the personnel and the funds available and the amount of new construction.

In 1977, the Appellant’s home was reevaluated and the value increased from $91,-000.00 to $134,010.00. This resulted in his taxes being increased from $1,090.41 in 1976 to $1,341.68 in 1977 for an increase of $251.27. He filed this suit for an injunction against the collection of taxes for 1977 and for a refund of excess taxes in prior years.

The Appellant’s first three points of error assert the trial Court erred in not finding that the reevaluation was arbitrary and resulted in an unequal tax burden on properties in the reappraised areas and that such scheme of taxation was in violation of the Appellant’s rights under both the Texas and United States Constitutions. The basic contention is that all property in a taxing district should be reevaluated in the same year so that each taxpayer pays taxes based upon a reappraisal made at the same time for all property. Mr. Parker asserts that his tax burden is greater than that of those taxpayers who will not have their property reappraised until a year or more after his last reevaluation.

The Constitution of Texas, Article VIII, Section 1, requires that taxation be equal and uniform and that all property be taxed in proportion to its value. But, the courts have recognized that exact evaluation is impossible to achieve. State v. Whit-tenburg, 153 Tex. 205, 265 S.W.2d 569 (1954). In order for a taxpayer to prevail against the taxing authority because it has allegedly followed an arbitrary plan or scheme, the taxpayer must show that the plan was arbitrary and illegal, and that the use of the plan worked to his substantial injury. State v. Whittenburg, supra; State v. Federal Land Bank of Houston, 160 Tex. 282, 329 S.W.2d 847 (1959).

The basic contention presented by Appellant was rejected in Brunken Toyota, Inc. v. City of Lubbock, 558 S.W.2d 523 (Tex.Civ.App. — Eastland 1977, writ ref’d n. r. e.). In that case, the taxing authority had divided the tax district into five zones, one of which was reappraised each year. This was later changed to four zones. Following authorities from other jurisdictions, the court concluded that there was no denial of any constitutional right in the use of a cyclical reevaluation program was carried out systematically and without intentional discrimination.

While it seems that it would be preferable to have the taxing authority, rather than the appraising firm, establish the area to be appraised each year, we find no evidence in this case that there was any arbitrary and intentional discrimination against any taxpayer in the plan used in Ector County. Points of Error Nos. 1, 2 and 3 are overruled.

The next four points assert error in the Court’s charge and in the failure of the trial Court to enter judgment for Appellant. The Court submitted to the jury four special issues, the last three being conditionally submitted upon an affirmative finding to the preceding issue. Those issues inquired (1) whether the reassessment plan was unreasonable; (2) whether the reassessment plan was an arbitrary plan to permit certain classes of property owners to escape their fair share of the tax burden; (3) whether Parker sustained substantial injury as a result of the reassessment plan; and (4) the amount of damages sustained by Parker as a result of the reassessment plan.

In each instance, the burden was on the Appellant to obtain a favorable answer to the issue submitted. In answer to Special Issue No. 1, the jury failed to find the plan was unreasonable. By reason of the conditional submission, no other issues were answered. The Court instructed the jury that the State Constitution provides that taxation shall be equal and uniform. The jury was also instructed that there must be a systematic and intentional discrimination before the Constitution is violated.

As we review the case, the problem arises from the fact that the Constitution does not require that the plan be “reasonable” as submitted in Special Issue No. 1, and the charge did not inquire if the plan used resulted in taxation which was not “equal and uniform” as required by the Constitution. We doubt that the first issue is a controlling issue. But, the Appellant did not object to it for that reason, and did not submit a substantially correct issue as was his burden. Rule 279, Tex.R.Civ.P.; Lyles v. Texas Employers’ Insurance Association, 405 S.W.2d 725 (Tex.Civ.App.— Waco 1966, writ ref’d n. r. e.). Likewise, no objection was made that the other issues were conditionally submitted. Thus, the Appellant has failed to sustain his burden of obtaining fact findings which would serve as a basis for a favorable judgment. Even in a case where the taxpayer seeks an injunction through a pre-certification suit, the burden is his to show that the taxing authority has followed a scheme that is arbitrary and illegal. Point of Error No. 4 is overruled.

The next point complains of the wording used in Special Issue No. 2. The Appellant did not tender a substantially correct issue as was his burden and any error has been waived. Rule 279, Tex.R.Civ.P.; Lyles v. Texas Employers’ Insurance Association, supra. Point of Error No. 5 is overruled.

The last two points assert the proof shows as a matter of law that Appellant sustained substantial injury in that he paid more taxes on his appraised property that he would have had to pay if all property within the districts had been simultaneously reappraised. These points cannot be sustained because Appellant did not establish fair market value of all his property within the taxing districts in order to prove substantial injury. In Lancaster Independent School District v. Pinson, 510 S.W.2d 380 (Tex.Civ.App. — Dallas 1974, writ ref’d n. r. e.), the court considered a similar contention and said:

Whether injunctive relief is sought before or after an illegal assessment plan is put into effect, taxpayers must show substantial injury in order to obtain injunc-tive relief against such a plan; that is to say, they must show that the plan would discriminate against them by deliberately assessing their property at a greater percentage of its true value than the percentage assessed for other properties subject to the tax. City of Arlington v. Cannon, 153 Tex. 566, 271 S.W.2d 414, 417 (1954); Atlantic Richfield Co. v. Warren Ind. Sch. Dist., 453 S.W.2d 190, 198 (Tex. Civ.App. — Beaumont 1970, writ ref’d n. r. e.). If the plan wholly excludes some classes of property from the assessment rolls, injury from such a plan may be shown without establishing the market value of plaintiff’s property. See City of Wichita Falls v. Cooper, 170 S.W.2d 777 (Tex.Civ.App. — Fort Worth 1943, writ ref’d). If the plan is attacked on the ground of inequality of assessment, however, proof of actual market value of plaintiff’s property is necessary, since without such proof no discrimination is established. Thus in Montgomery County v. Humble Oil & Refining Co., 245 S.W.2d 326, 335 (Tex.Civ.App. — Beaumont 1951, writ ref’d n. r. e.), the taxpayer showed that the board of equalization had used an illegal plan to raise its tax valuation in that it had raised the valuation of mineral properties to about one-third of what the board assumed to be the market value and assessed all other property at about one-tenth of its assumed market value. The court held that although this plan was illegal the taxpayer was not entitled to a temporary injunction because plaintiff was not injured if its property was actually worth more than ten times its assessed value, as evidence of actual value might show. The holding in Humble was expressly approved by the supreme court in State v. Whittenburg, 153 Tex. 205, 265 S.W.2d 569, 574 (1954), and also in City of Arlington v. Cannon, supra, 271 S.W.2d at 417.

In Anderson County Taxpayers’ League v. City of Palestine, 576 S.W.2d 679 (Tex.Civ.App. — Tyler 1979, no writ), the court in an injunction case seeking to enjoin the taxing districts from approving their tax rolls or collecting the taxes again noted the burden on the taxpayer to prove (1) an arbitrary and illegal tax scheme and (2) that they as taxpayers will probably sustain substantial injury from the illegal plan or scheme. In that case, the court concluded the first half of the burden was met but not the second half and relies upon the holding in the Pinson case. We conclude that in this case the taxpayer did not meet either of the two requirements in order to obtain the relief sought. Points of Error Nos. 6 and 7 are overruled.

The judgment of the trial Court is affirmed.


author: WARD, Justice.

text:
    Cesario BRAVO, Jr., et al., Appellants, v. TEXAS FARMERS INSURANCE COMPANY, Appellee.
    No. 6834.
    Court of Civil Appeals of Texas, El Paso.
    July 11, 1979.
    Joseph (Sib) Abraham, Jr., Duane A. Baker, Luis E. Islas, El Paso, for appellants.
    Dudley & Dudley, William C. Dudley, Paul W. Dudley, Keith C. Gorman, El Paso, for appellee.
   OPINION

WARD, Justice.

The Plaintiffs brought suit in El Paso against their automobile insurance carrier under the uninsured motorist coverage provision for injuries arising from an automobile accident that occurred in Juarez, State of Chihuahua, Mexico. The trial Court sustained the Defendant’s plea to the jurisdiction based on the rule of lex loci delicti and the dissimilarity doctrine regarding the tort laws of Mexico. Because of the new rules established in Gutierrez v. Collins, Tex., 583 S.W.2d 312 (1979), regarding the two doctrines, we reverse and remand.

The Plaintiffs, Cesario Bravo, Jr., Herminia Bravo, Jesus Bravo and Margarita Bravo, were in an automobile owned by Cesario Bravo, Jr. and operated by Herminia Bravo. While stopped at a controlled intersection in Juarez and within ten miles from the International Border, the automobile was rear-ended by a bus operated by Autotransportes del Valle and driven by Sosimo Dominguez. The Plaintiffs alleged that they are residents of El Paso, that the accident was caused by the negligence of the bus company and its driver, and those two Defendants were alleged to be residents of Juarez, Mexico. The Plaintiffs sued for the personal injuries that they each received and alleged that their damages were their pain and suffering, medical expenses, lost wages, and lost earning capacity. The Plaintiffs further alleged their coverage under the uninsured motorist protection clause of an insurance policy issued by Texas Farmers Insurance Company to Cesario Bravo, Jr., the policy extending coverage on accidents occurring ten miles into Mexico. Plaintiffs also alleged that the bus was an uninsured motorist vehicle within the terms of the policy, and that neither the owner nor the driver of the bus carried liability insurance upon said vehicle, and that the Defendant Insurance Company, up to the policy limits, is now liable to pay all sums which the Plaintiffs would have received from the above named driver and owner for their injuries. As stated, the trial Court sustained the Defendant’s plea to the jurisdiction and dismissed the cause of action.

The Plaintiffs’ first two points are that the trial Court erred in granting the Defendant’s motion to dismiss in that under the recent amendments to Article 4678, Tex.Rev.Civ.Stat.Ann., Texas courts should use the most significant contacts rule, and that the article was intended to operate retroactively and should be applied to the instant cause of action. In the Gutierrez opinion, the Supreme Court stated that the statute itself is immaterial one way or the other to the common law cause of action asserted by the Plaintiffs, and that regardless the statute is not to be given retroactive effect. The two points are overruled.

The Plaintiffs’ third point is to the effect that the trial Court erred in granting the motion to dismiss in that in this conflict of law case Texas law should be applied as to the tort portion of the cause of action, the point carrying with it the argument as to the tort feature that the rule of lex loci delicti should no longer be followed. The point is sustained. The portion of this conflict case which sounds in tort must now be determined by the “most significant relationship” test as enunciated in Sections 6 and 145 of the Restatement (Second) of Conflict of Laws. It is further noted that if the trial Court determines that the law of Mexico applies as to the tort portion of the cause of action, the dissimilarity doctrine is no longer a defense.

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


author: KEITH, Justice.

text:
    Lurlene WHEELER, Appellant, v. Gene KEELS, Appellee.
    No. 8310.
    Court of Civil Appeals of Texas, Beaumont.
    July 12, 1979.
    Rehearing Denied July 31, 1979.

      Tom L. Ragland, Waco, for appellant.
    G. A. Fitzgerald, Temple, for appellee.
   KEITH, Justice.

This is a venue appeal. Plaintiff, alleging that she was a resident of McLennan County, brought suit in Bell County to recover damages for injuries she alleges she received while upon premises owned by Alton C. Boston, a resident of Bell County. The premises were leased to and in the possession of Gene Keels, a resident of Smith County. She sought a joint and several judgment against the owner and tenant. Boston answered generally and Keels filed his plea of privilege to be sued in the county of his residence.

Plaintiff’s counsel then prepared a controverting affidavit wherein he sought to maintain venue in Bell County, and mailed, it to the District Clerk with the request that she secure a setting thereon and to notify all counsel of the date of the hearing. No stamped or addressed envelope accompanied the request.

The clerk secured the signature of the judge upon the order setting a hearing and testified that she notified all counsel of the setting by mailing notice to such counsel. But plaintiff’s counsel denied receiving such notice and did not appear at the hearing.

At the time and place set in the notice of the hearing, Keels presented his plea of privilege and it was granted, and the Court severed the cause as to Boston from that relating to Keels. A few days thereafter, the clerk mailed a cost bill to plaintiff’s counsel and, so he testified, this was his first notice of the action upon his controverting plea.

Plaintiff then filed a motion to vacate the order transferring the cause and it was heard and denied less than thirty days after the order sustaining the plea of privilege was entered. Defendant appeals assigning two points of error, the first of which is that under the rationale of Craddock v. Sunshine Bus Lines, Inc., 134 Tex. 388, 133 S.W.2d 124 (1939), the court erred in refusing to vacate the order sustaining the plea of privilege. This Court, in Drennan v. Belgin Enterprises, Inc., 434 S.W.2d 899, 903 (Tex.Civ.App. — Beaumont 1968, no writ), held that the Craddock rule is applicable to a venue case wherein plaintiff failed to appear at the precise time set for the hearing on the controverting affidavit.

Plaintiff’s reliance upon the Craddock rule is misplaced for the reason that his claimed lack of notice was a controverted issue of fact before the trial court in the hearing and was determined adversely to him. The deputy clerk was positive in her testimony that she prepared three notices of the hearing, one for each lawyer involved in the case, and that they were all properly mailed. None of the letters were returned and all other counsel received their notices.

In effect, counsel made the deputy clerk his agent for the purpose of presenting the controverting plea to the trial judge and procuring a date for the hearing thereon. It was plaintiff’s duty to secure the hearing. 1 B. McDonald, Texas Civil Practice § 4.52, at 604 (Rev. Vol. 1965), and cases therein cited. Counsel now complains that because his agent failed to mail him a notice, the trial court erred in proceeding with the hearing as originally scheduled. We are not favorably impressed with the contention but do not rest our decision upon this fact alone.

As the only witness appearing in behalf of the plaintiff upon the hearing of the motion to vacate the order sustaining the plea of privilege, counsel was an interested witness and the trial court was the sole judge of the credibility of the witnesses and of the weight to be given to their testimony. Counsel testified that he did not receive the notice; all other counsel received their notices and the clerk’s testimony was positive and direct. A fact issue was presented and determined adversely against plaintiff. See generally, Gevinson v. Manhattan Constr. Co., 449 S.W.2d 458, 467 (Tex.1969); Bates v. Barclay, 484 S.W.2d 955, 959 (Tex.Civ.App. — Beaumont 1972, writ ref’d n. r. e.).

We recognize the continuing vitality of the Craddock rule; but, the fact structure of the case at bar does not make such rule applicable. We find no abuse of discretion on the part of the trial court in refusing to vacate its prior order and point one is overruled.

Nor do we find that error is presented by the second point: that plaintiff has been unable to procure a statement of facts for use upon appeal. Plaintiff has not cited any authority which requires a defendant, after timely filing a proper plea of privilege, to offer testimony at the hearing on the controverting plea, and we know of no such case. Indeed, the plea of privilege is prima facie proof of the defendant’s right to have the venue changed to the county designated in his plea. Tempelmeyer v. Blackburn, 141 Tex. 600, 175 S.W.2d 222, 224 (1943). Moreover, the filing of the plea of privilege divests the court of jurisdiction to enter judgment against the defendant pending disposal of the plea of privilege. Texas-Louisiana Power Co. v. Wells, 121 Tex. 397, 48 S.W.2d 978, 981 (1932); Norrell v. National Motor Club, 498 S.W.2d 257, 260 (Tex.Civ.App. — Tyler 1973, writ ref’d n. r. e.).

It was plaintiff’s burden upon the hearing to plead and prove that her case was within one or more of the exceptions set out in the general venue statute. Banks v. Collins, 152 Tex. 265, 257 S.W.2d 97, 99 (1953).

When plaintiff’s counsel failed to appear at the scheduled hearing on the controverting plea of privilege, the trial court was authorized to sustain the plea without hearing evidence since plaintiff had not carried the burden of proving the necessary venue facts to maintain venue in the county of suit. Inability to procure a statement of facts under this record is no cause of reversal.

The judgment of the trial court is affirmed.

       It is unnecessary for us to determine if Tex.R. Civ.P. 246, requiring non-resident attorneys to supply the clerk with a return envelope properly addressed and stamped, applicable to notice of settings on the merits, is also applicable to venue hearings. Cf. State v. Perkins, 185 S.W.2d 1019, 1021 (Tex.Civ.App. — Texarkana 1944), reversed on other grounds, 143 Tex. 386, 185 S.W.2d 975 (1945).


author: CLAYTON, Justice.

text:
    Alton F. STANZEL et al., Appellants, v. Willie Mae O’BRIEN et al., Appellees.
    No. 8305.
    Court of Civil Appeals of Texas, Beaumont.
    July 12, 1979.
    Rehearing Denied July 31, 1979.
    W. T. Miller, Gonzales, for appellants.
    William R. Laughlin, Baytown, for appel-lees.
   CLAYTON, Justice.

This is a will contest in which Betty Chesbro, proponent, sought application to probate a will of Frank Stelzig, decedent, dated September 16, 1971. Appellants, heirs at law of the decedent, contested such application. Appellees intervened with an application to probate an earlier 1965 will and contested Chesbro’s application.

This appeal arises from the trial court’s granting of appellees-intervenors’ motion for leave to take a non-suit without prejudice. The record reflects that at the conclusion of the presentation of all the evidence by all parties and after all parties had rested, appellants filed their motion for instructed verdict as against appellees. In response to such motion, appellees filed their motion for leave to take a non-suit without prejudice, and the trial court granted such motion. The court dismissed appel-lees’ application to probate the will of Frank Stelzig dated July 20, 1965, without prejudice to refile their application to probate such will. Subsequently, appellants filed their motion requesting that such order of dismissal be amended so as to order such dismissal with prejudice to refile. This motion was overruled by the trial court.

Appellants urge, by their fifth point, error by the trial court in granting “Appel-lees’ Motion for non-suit after Appellees had rested their case and in not dismissing Appellees’ suit with prejudice.”

Tex.R.Civ.P. 164, as amended effective January 1, 1976, provides:

“Upon the trial of any case at any time before plaintiff has rested his case, i. e., has introduced all of his evidence other than rebuttal evidence, the plaintiff may take a non-suit, but he shall not thereby prejudice the right of an adverse party to be heard on his claim for affirmative relief.”

Prior to this amendment, the plaintiff could not take a non-suit, as a matter of right, at any time before the court announced its decision in open court. Mitchell v. Coker, 531 S.W.2d 204 (Tex.Civ.App.— Waco 1975) writ ref’d n. r. e. per curiam, 535 S.W.2d 175 (Tex.1976). As amended, the rule now permits the plaintiff to take a non-suit only until it rests its own case-in-chief. Coker v. Mitchell, 535 S.W.2d at 176.

The non-suit and dismissal thereon granted by the trial court in the case at bar was not an adjudication of the rights of any of the parties. The obvious intent and effect of Tex.R.Civ.P. 164, as amended in 1976, is that once the plaintiff has elected to proceed with his case and introduced all his testimony and rests, then the defendant is entitled to an adjudication of all the rights of the parties before the trier of facts. The non-suit taken by appellees deprived appellants the right to such adjudication. Rule 164 now specifically prohibits the taking of a non-suit after appellees had rested their case-in-chief.

The ’question before this court at this time is the appropriate relief to be afforded appellants in view of appellees’ impermissible non-suit. To reverse and remand will be, in effect, to give and allow the appellees the very same relief they were erroneously accorded by the trial court. All parties in this case had presented their evidence and rested. Appellants had properly filed their motion for instructed verdict as against ap-pellees. The act of the trial court in erroneously permitting appellees to take their non-suit was tantamount to overruling appellants’ motion for instructed verdict. Ap-pellees admit in their brief that such motion for instructed verdict was legally sound and, by inference, would and should have been granted by the court. It is clear that süch was the reason for taking the non-suit. To permit a non-suit without prejudice under these circumstances would completely nullify the provisions of Rule 164 and render the same meaningless. To give effect and meaning to Rule 164 we hold that when plaintiff takes a non-suit after he has presented his evidence and has rested his own case-in-chief, the order of dismissal entered thereon shall be one of dismissal with prejudice to refile.

The trial court’s order of dismissal without prejudice is reversed, and we render the order which should have been entered by the trial court: The application of appellees to probate the will of Frank Stelzig, dated July 20, 1965, is dismissed with prejudice to refile.

REVERSED and RENDERED.


text:
    DAVIS-KEMP TOOL CO., INC., Appellant, v. Bob BULLOCK, Comptroller of Public Accounts of the State of Texas, Appellee.
    No. 8304.
    Court of Civil Appeals of Texas, Beaumont.
    July 12, 1979.
    Rehearing Denied July 31, 1979.
    C. Ed Harrell, Houston, for appellant.
    Myra A. McDaniel, Austin, for appellee.
   KEITH, Justice.

Plaintiff sued to recover taxes assessed under the Limited Sales, Excise and Use Tax Act, Title 122A, Tex.Tax.-Gen.Ann. Chapter 20 (1969 & Supp.1978-79), hereinafter simply the “Act”. Refund was claimed pursuant to Art. 20.10(G) and (H) of the Act, relating to claims for overpay-ments and refunds. In a bench trial wherein extensive stipulations were filed and some oral testimony adduced, the trial court denied plaintiff any relief and it has appealed.

State’s counsel has a crosspoint complaining of the lack of specificity in the claim for refund; but, we prefer to address the merits of the appeal and express no opinion as to the claims advanced by the State in the crosspoint. After a careful review of the contentions advanced by plaintiff, we find no error and the judgment will be affirmed for the reasons now to be stated.

Plaintiff is engaged in the business of furnishing specialized fishing and rental tools, along with highly skilled operators thereof, to entities engaged in the drilling and producing of oil and natural gas. It has contracts with several tool companies whereby it warehouses tools furnished by such companies for use by its customers when needed. Title to the tools remains in the tool companies and once used by plaintiff while working for a customer, the particular tool is returned to the owner for repair or other disposition.

Plaintiff’s customers are billed on a long invoice which includes not only the rental cost of the particular tools involved, but the cost of transportation and the supervisor’s wages earned in the operation of the tools. Plaintiff reports to each of the tool companies every month as to the use and the rental charges for the tools and remits one-half thereof to the tool company involved. Until used by plaintiff while working for one of its customers, no rental is due and none is paid to the owner of the tools. Title to the tools always remains in the particular tool company and never passes to plaintiff or its customers.

The owners of the tools never deal directly with plaintiff’s customers although they do set the price schedule which plaintiff is required to use in billing its customers. All risk of non-payment is borne by plaintiff.

The basic controversy between the parties turns upon plaintiff’s status. The State contends that the contractual arrangements between the tool companies and plaintiff are such that, in law, the plaintiff is a lessee of the suppliers of the tools. State’s counsel argues that the contracts are unambiguous and the Court is required to consider the rights of the parties thereunder in accord with the language selected by the parties. We agree. City of Pinehurst v. Spooner Addition Water Co., 432 S.W.2d 515, 518 (Tex.1968); Myers v. Gulf Coast Minerals Management Corp., 361 S.W.2d 193, 196 (Tex.1962).

It is shown by the joint stipulation that there has been a Comptroller’s Ruling in effect since 1963 which covers tax treatment of services performed on oil and gas wells. This Ruling is further supported by one issued in 1969 relating to rentals and leases. The latter Ruling states that in transactions where equipment is furnished with an operator or supervisor, it is not considered a lease since the person furnishing the equipment retains control.

The testimony of plaintiff’s officers confirms its control and possession of the tools. It furnishes the supervisor or operator who is the “one man who is qualified and knows how to put these tools together to accomplish a given need.” The tools are kept in its warehouses until taken to the job; and, while on the job, remain in possession of the supervisor or operator.

The State established the applicability of the 1969 Ruling to the facts in the case at bar. Thus, the arrangement between plaintiff and its customers was not a lease; plaintiff was simply providing a service to its customers and, incidentally, used equipment which it had leased from the owners of the tools. As to the relationship between the owners of the tools and plaintiff, the transaction was exempt from the provisions of the Act under the 1963 Ruling.

In making this determination we follow the rule that long-standing department construction of statutes is entitled to great weight. Calvert v. Kadane, 427 S.W.2d 605, 608 (Tex.1968); Armco Steel Corp. v. Texas Employment Comm’n, 386 S.W.2d 894, 896 (Tex.Civ.App. — Austin 1965, writ ref’d n. r. e.).

We agree with the State’s contention which we paraphrase: Here the suppliers lease the equipment to plaintiff who then uses it in providing oil well services to its own customers. These customers do not use the equipment so that plaintiff is the ultimate consumer. There is no resale or re-lease of the equipment since plaintiff’s customers never get control or dominion over the equipment.

As we understand its contention, plaintiff claims that it is exempt from taxation under the “Sale for Resale: Leasing or Renting” provision of the Act, Art. 20.04(0)(1), and its single authority is Day & Zimmermann, Inc. v. Calvert, 519 S.W.2d 106 (Tex.1975). We find no merit to the argument advanced and the point is overruled.

One of the terms appearing upon plaintiff’s memorandum accompanying its services is this:

“Customer acknowledges and agrees that in rendering services or furnishing equipment, including leased equipment, that DKTC [plaintiff] does so only as an independent contractor . . .

The record bears out this description of the relationship since the customer has no control over the equipment or plaintiff’s personnel operating it on customer’s job site. Moreover, there is no evidence that the owners of the tools ever sought to direct plaintiff in the conduct of its business, the number or type of tools to use, where or when to use the tools, or the hours of work of its employees, or to exercise any control whatsoever over the operation of plaintiff’s business.

Plaintiff’s status in relation to its tool suppliers and to its customers was that of an independent contractor under the rationale of Industrial Indemnity Exchange v. Southard, 138 Tex. 531, 160 S.W.2d 905, 907 (1942), and its progeny.

Under the undisputed record which we review, plaintiff’s activities do not come within the exemption found in the statute which it cites. The tools in question were not acquired for resale or for re-lease; they were possessed by plaintiff for its own ultimate use as an independent contractor in servicing customers in need of the tools, men, and expertise it possessed.

Plaintiffs, seeking an exemption from taxation, encounter the rule expressed in Hilltop Village, Inc. v. Kerrville Independent School District, 426 S.W.2d 943, 948 (Tex.1968):

“All of the courts appear to pay homage to the rule that tax exemptions are subject to strict construction since they are the antithesis of equality and uniformity.”

See also Loyd W. Richardson Constr. Co. v. Calvert, 509 S.W.2d 696, 697 (Tex.Civ.App. —Beaumont), writ ref’d n. r. e. per curiam, 518 S.W.2d 545 (Tex.1974), and authorities therein cited.

We find no ambiguity in the statute, the Comptroller’s Rulings, or in the written evidence before us. Consequently, we have no occasion to invoke the rule of construction mentioned in Wilson Communications, Inc. v. Calvert, 450 S.W.2d 842, 844 (Tex.1970), and reaffirmed in Bullock v. Statistical Tabulating Corp., 549 S.W.2d 166, 169 (Tex.1977).

Finally, plaintiff argues that its services are not subject to taxation under the Act and relies upon language found in Bullock v. Statistical Tabulating Corp., supra.

The taxes in question were not levied upon the lease of the tools by plaintiff from the owners; instead, the tax was incurred when plaintiff, as an independent contractor, used the tools and its own personnel in working upon the rigs of its customers. Statistical Tabulating involved the question of whether there was or was not a sale of tangible personal property. We do not find the case to be in point in the case at bar.

Each of plaintiff’s points, after consideration, are overruled and the judgment of the trial court is AFFIRMED.

      . Ruling No. 43. Oil, Gas and Related Well Service, July 1, 1963.

      . Ruling No. 95-0.43. Oil, Gas and Related Well Service, October 1, 1969.

      . The statute reads: “There are exempted from the taxes imposed by this Chapter the receipts from all sales for resale, leasing, renting or for transfer as an integral part of a taxable service rendered in the regular course of business.”


text:
    David J. LEVY, D.O. and Associates et al., Appellants, v. LAMAR SAVINGS LEASING CORPORATION, Appellee.
    No. 8301.
    Court of Civil Appeals of Texas, Beaumont.
    July 12, 1979.

      Charles B. Spicer, Jr., Pasadena, James A. Bannerot, Austin, for appellants.
    Thomas H. Watkins, Austin, for appellee.
   KEITH, Justice.

Defendant below appeals from an order overruling his plea of privilege to be sued in Harris County. We affirm.

Plaintiff brought suit upon a written equipment lease wherein the primary obli-gor on the 'lease was “David J. Levy, D.O. and Associates”, described in plaintiff’s petition as an association, and the instrument was signed by David J. Levy “Owner”. It was also signed by Levy “As an Individual”.

Plaintiff’s controverting affidavit relied upon Tex.Rev.Civ.Stat.Ann. art. 1995, subdiv. 5 (Supp.1978-79). The venue facts under such subdivision are those stated in Brazos Valley Harvestore Systems, Inc. v. Beavers, 535 S.W.2d 797, 800 (Tex.Civ.App. —Tyler 1976, writ dism’d). The plaintiff must prove:

“(1) that the defendant is a party reached by the statute; (2) that the claim is based upon a written contract; (3) that the contract was entered into by the defendant or one authorized to bind him; and (4) that the contract by its terms provides for performance of the obligation sued upon in the county of suit.”

Moreover, as held in Harkness v. Employers National Life Insurance Co., 502 S.W.2d 670, 670 (Tex.1973), this subdivision is “not invoked unless the contract in writing expressly names the county of performance or a definite place therein.”

The contract upon which plaintiff sued did not name a particular county wherein defendant was required to perform. Instead, it contained this language:

“All payments of rent shall be made at the office of Lessor, at the address set forth below Lessor’s signature herein, or at such other place as Lessor may designate by attached Schedule ‘A’, made a part hereof.”

Since the contract did not name a specific county of performance, extraneous evidence was admissible to establish the county in which plaintiff’s place of business was located. Garcia v. Coastal Bend Prod. Credit Ass’n, 430 S.W.2d 385, 386 (Tex.Civ.App. — Corpus Christi 1968, no writ), and authorities therein cited. See also Bruce Campbell & Son Constr. Co. v. Britton Drive, Inc., 527 S.W.2d 852, 854-55 (Tex.Civ.App. — Waco 1975, no writ).

Plaintiff established by evidence of a probative nature the fact that the office of the lessor was in Travis County, thus satisfying the requirements of subdiv. 5(a) of Article 1995.

In establishing its right to maintain the suit in Travis County, plaintiff’s counsel offered in evidence a photocopy of the original of the contract between the parties, identifying it through the testimony of its president who was present at the time of the execution thereof.

Defendant objected to the admission of the photocopy of the contract “as not being the best evidence” in the case. This prompted an inquiry by the Court: “Where is the original?” to which plaintiff’s counsel replied:

“I don’t have any idea where the original is, but this copy was served upon opposing Counsel at the time that the petition was served . . . .”

The objection was overruled and the photocopy of the lease was received in evidence.

We note that while defendant’s controverting affidavit was in proper form, it did not include a verified denial of any of the matters set out in Tex.R.Civ.P. 93 as required in the third paragraph of Tex.R. Civ.P. 86. Moreover, plaintiff proved that the instrument in question was kept in the regular course of business as required by Tex.Rev.Civ.Stat.Ann. art. 3731b, § 2 (Supp. 1978-79). Under Section 4 of the cited statute, “The existence or non-existence of the original shall not affect the admissibility of the reproduction.” The complaint is without merit and is now overruled.

Defendant has no point on appeal challenging the failure of plaintiff to prove the existence of a cause of action at the venue hearing. It has long been the law of this state that the single venue fact under subdivision 5(a) is that the defendant contracted in writing to perform the obligation in a particular county where the suit is filed or at some definite place therein which is named in the writing. Southwestern Inv. Co. v. Allen, 160 Tex. 258, 328 S.W.2d 866, 867 (1959); Angler’s Lodge, Inc. v. Scruggs, 532 S.W.2d 109, 111 (Tex.Civ.App. — San Antonio 1975, no writ).

Finding no error, the judgment is affirmed.