author: STEPHENSON, Justice. KEITH, Justice

text:
    Reba Cox WESTMORELAND et vir., Appellants, v. BEAUMONT INDEPENDENT SCHOOL DISTRICT, Appellee.
    No. 7696.
    Court of Civil Appeals of Texas, Beaumont.
    May 29, 1975.
    Rehearing Denied June 12, 1975.
    W. G. Walley, Jr., Beaumont, for appellants.
    Anthony G. Brocato, Beaumont, for ap-pellee.
   STEPHENSON, Justice.

This is an eminent domain case. Reba Cox Westmoreland appeals from a judgment rendered upon the jury verdict.

The only special issue submitted inquired as to the market value of the tract of land taken. The instruction with that issue told the jury it could consider the value of buildings and other improvements on the land to the extent they enhanced the value of the land. The jury answered $40,000.

Only two witnesses testified as to the value of the land. The landowner, Reba Cox Westmoreland, testified as follows: She is a nurse at Baptist Hospital. She was born in a house located on the property in question, which was built in 1910. There is a rent house on the property which was built before the home place. There is also a filling station on the property which was built in the early thirties and which had been rented for $75 per month shortly before this taking in October 1974. She has kept up with the real estate value in Beaumont. In her opinion, the market value of this property on the date of taking was $90,000.

Edwin Terry, a witness called by the School District, testified as follows: He is a real estate appraiser and has been in that field the past twenty-four years. He was employed by the School District to appraise the property in question. The area is an older commercial neighborhood, and the values appear to be going down. The highest and best use of this property is for secondary commercial use. A typical purchaser would probably be buying the land only. The value is in the land itself. Out of the three approaches available — cost, income, and market — the cost approach was most indicative of market value and was given the most credence. The difficulty with the market approach was in finding similar property with similar improvement. In following the cost approach, the first step is to ascertain the value of the land by comparing it with other land sold in the vicinity that is similar. He examined sales that had occurred in the neighborhood. He confirmed a contract of sale of a tract of .517 acre out of the property in this suit, dated March 1974, from these landowners to Howell Liquidating, Incorporated, at a sale price of $8,000 or 36 cents per square foot. That tract did not include the two houses or the filling station. The second comparable is a sale from Michael to Taft, March 17, 1970, containing .944 acre located four or five blocks from the property in question. The consideration was $18,000 or 44 cents per square foot. It had a residence on it, which was moved, and a 2,230 square foot tile building on it which was later used as a grocery store. That building is superi- or to anything found on the property in question.

It was at this point, over objection, that the trial court permitted Terry to testify to two comparables which were sales of vacant land, one at 19 cents and the other at 20 cents per square foot. The witness then testified as to one additional sale of a tract of land containing an old residence for $7,500 or 34 cents per square foot. He took those sales, plus additional sales, and arrived at a figure of 25 cents per square foot for the property in question, or $35,562. Then, continuing with the cost approach, he estimated the reproduction cost of the improvements, depreciated them, and placed the value at $4,400. Adding the two and rounding it out, he placed the total value at $40,000. Terry then explained the income approach and came up with a value of $40,-392. He also placed the value at $40,000 under the market approach, which included all of the comparables used in the cost approach. He then stated that, in his opinion, the fair market value of this property on the date of taking was $40,000.

On cross-examination, Terry testified as to another sale of a tract of land with an old service station on it, which sold for $8,900 or 67 cents per square foot, with the old service station worth about $2,000, reducing the value to 51 cents per square foot for the land. Then that last sale following confirmation was $15,000 resulting in a net value of 97 cents per square foot.

The three points of error raised by the landowners all relate to the admission in evidence on direct examination testimony concerning the sales of unimproved land. The trial court had denied a motion in li-mine as to one of such sales. We are cited three Texas Supreme Court cases in support of these points of error.

The first is Chaney v. Coleman, 77 Tex. 100, 13 S.W. 850 (1890). In this case the trial court excluded evidence as to the value of unimproved land, when the land being taken was improved, and the Supreme Court affirmed such action.

The second case is City of Austin v. Cannizzo, 153 Tex. 324, 267 S.W.2d 808 (1954). In this case, the property taken was unimproved, and the Supreme Court held that evidence as to prices paid for improved property was not admissible, because they did not meet the test of similarity.

The third case is State v. Chavers, 454 S.W.2d 395 (Tex.1970). This case involved the taking of unimproved land, and the trial court admitted evidence as to a sale of improved land. The Supreme Court held that such sale was not comparable and was not admissible. The language of this case makes it clear that an expert may take such type of transaction into consideration as a part of his mental processes in arriving at his opinion as to the market value of the property taken, but cannot testify on direct examination as to the facts of such sale.

Counsel for the school district recognizes the rule set forth in the three cases mentioned above, but seeks to distinguish the present case. It is argued first that Chaney v. Coleman, supra, simply holds that if improved land is to be compared to improved land, the improvements must correspond. Then, as to Cannizzo, supra, and Chavers, supra, the rule is that when unimproved land is being taken, evidence as to sales of improved land is not admissible. But, that the converse of that rule has not been held to be true in this state.

We are cited Housing Authority of the City of Dallas v. Hubbard, 274 S.W.2d 165 (Tex.Civ.App.—Dallas 1954, no writ), in which the Court of Civil Appeals held it was not error to allow a witness to testify as to the sale of unimproved land as a comparable in a taking of improved land. The witness allocated a portion of the value to the land and a portion to the improvement, and the court said that testimony did not violate the rule laid down by the Supreme Court that the value of unimproved property may not be determined by comparing its value with improved property.

We are also cited State v. Adams, 489 S.W.2d 398 (Tex.Civ.App.—San Antonio 1972, writ ref’d. n. r. e.), a proceeding to condemn improved land, and the court held that evidence concerning the value of the land alone was admissible.

We cannot agree with the argument of the School District that the converse of the rule of the Chavers Case, supra, is not true. We find no logical reason not to apply the Chavers rule in both situations. We hold that on direct examination testimony as to sale of unimproved property cannot be used as a comparable in a suit involving the taking of improved property.

However, having determined the evidence was not admissible does not dispose of the point of error. We still must consider Texas Rules of Civil Procedure, rule 434 in determining whether or not there is reversible error. We have come to the conclusion that under the facts of this case no reversible error is shown.

We have made a careful study of the Chavers Case, supra, especially as to the last point of error discussed on page 398 of that opinion. Disposition of that point is stated as follows:

“The final question is whether the error was so harmful as to require reversal and a new trial. We look to the entire record to decide if the error was ‘reasonably calculated to cause and probably did cause the rendition of an improper judgment in the ease.’ Gomez Leon v. State, 426 S.W.2d 562, 465 [565] (Tex.Sup.1968). The jury awarded the landowner the contended value of $300 per acre, supported by no sale other than the one from Neal to Anderson. This value was also supported by the independent opinion of the expert witness, but it was the ‘three hundred dollar sale’ which was repeatedly emphasized by landowner’s attorney. We believe the verdict was affected by this incompetent evidence.” (454 S.W.2d 398)

We do not come to the same conclusion in this case. We do not believe the error complained of was reasonably calculated to cause, and probably did cause, the rendition of an improper judgment. As stated at the beginning of this opinion, the only witness to testify for the landowner was the landowner whose occupation was that of a nurse. She stated that in her opinion the market value of this property was $90,000 without giving a basis for that opinion. On the other hand, the witness called by the School District had twenty-four years’ experience in real estate and appraising. He testified in great detail as to the methods of appraising, as well as to the facts upon which he based his conclusions. He testified, without objection, to a contract of sale made by these landowners covering a part of the land taken by this suit. The contract of sale entered into by these landowners was for .517 acre of land for $8,000 or thirty-six cents per square foot. However, Terry testified that this .517 acre tract contained more frontage proportionately than the entire tract, and that made it more valuable per square foot. He also emphasized that the larger the tract, the less per square foot a tract of land, such as this, can be sold for. Terry testified to the sale from Michael to Taft which was an improved comparable. This sale was for forty-four cents per square foot, but that included the improvements, which were a residence that was removed and a tile building superior to anything on the property being taken in this case. Then followed the two comparables about which we have held the evidence was not admissible. Terry then testified to another improved comparable which sold for thirty-four cents per square foot and which included an old residence. Again, he emphasized the fact that this sale was a lot, 85 x 257.32 feet, and much smaller than the tract taken here, and, therefore, sold for more per square foot. He concluded his direct evidence by stating the value of this property to be $40,000 under the cost approach, income approach, and the market approach. In Chavers the objectionable opinion evidence was supported by the one objectional sale only, while here the expert witness listed three comparables to which there was no objection. It cannot be said that the value found by the jury is outside of the range of the testimony. The expert witness found that value ($40,000) by using all three recognized methods of appraisal, two of which are completely independent of the use of comparable sales. There is no rule of law which says the testimony of value witnesses must include a comparable equal to the market value they arrive at. As stated by this witness, it is almost impossible to find a comparable with the identical improvements, and to hold that if the comparable does not have improvements of the same or a lesser value, that it could not be used, would practically eliminate this type of appraisal.

In the dissenting opinion a table of values is set forth under the headings “Admissible Evidence” and “Inadmissible Evidence.” Even a careful reader of that dissent might not realize that two of the three tracts listed under “Admissible Evidence” showing “cents per square foot,” include the value of the improvements located upon each tract. A casual reader might be misled into believing the tracts shown under each category can be compared, and that the table demonstrates harm in this case to the landowners. This table appears in the brief filed by the landowners, who, while arguing that improved comparables are not admissible in this case, would use the improved comparable as a method of proving harm. Only the first tract shown under heading “Admissible Evidence” contained no improvements, it being the tract covered by the contract of sale entered into by the landowners. And, as set forth earlier in this opinion, reasons are given why the smaller and better located tract would be worth more per square foot than the tract as a whole.

Throughout Terry’s testimony, it was made clear that the value of this property being taken is in the land, which is completely different from the Chavers Case, supra, where most of the value was in the improvements. Also, in Chavers, supra, the Supreme Court found it was reversible error to allow the expert witness to testify as to the allocation related to him by the seller (not a witness) between the value of the land and improvements. In the case before us, the only testimony as to allocation came from the expert witness. We find no reversible error.

Affirmed.

KEITH, Justice

(dissenting).

Having found error in the proceedings below; and, after making a “judgment call” from a review of the entire record, the majority finds that there is no reversible error. Ordinarily, I would concur; or, at least, suppress my inclination to dissent. A careful review of the record in this case does not permit even this small luxury. Counsel for the landowner alerted the Court and opposing counsel to the two specific “non-comparables” in his motion in limine but the motion was overruled in the teeth of State v. Chavers, 454 S.W.2d 395 (Tex.1970).

Condemnor’s attorney, thoroughly familiar with the doctrine of Chavers, succeeded in convincing the trial court that the evidence was admissible. This Court, recognizing as it must that the testimony was erroneously admitted, affirms, finding “no reversible error.” I do not join in this conclusion.

The first two of the so-called “comparable sales” mentioned by the expert were not within the Chavers Rule; each involved the sale of land with improvements thereon, just as does the property involved in this suit. The condemnee had no tenable objection available and the testimony was received without objection. The first was made upon the basis of 36$ per square foot while the second was upon the basis of 44$

Upon direct examination, over specific objections carefully tailored to invoke the Chavers Rule, the expert’s testimony as to sales of unimproved land produced valuations of 20$ and 19$, respectively, for these two tracts. The receipt of this evidence was clearly error under Chavers and the majority — correctly—so holds. The fifth “comparable” mentioned by the expert was improved land with a square foot value of 34$.

I set out in tabular form the valuations, upon a square foot basis, considered by the condemnor’s expert witness:

Admissible Evidence Inadmissible Evidence
Tract One — 360 Tract Three — 200
Tract Two — 440 Tract Four — 190
Tract Five — 340

Whereupon, and upon the basis of these “non-comparable sales”, condemnor’s expert witness testified, on direct examination, over the landowner’s objection, that the subject property of the landowner had a fair market value of 25$ per square foot, or $35,562. Then, following explicitly the rationale condemned by Justice Reavley in Chavers, supra, the expert placed a value on the improvements of $4,400, which he added to the land value. Thus, he arrived at a value of the property with the improvements at the “rounded” figure of $40,000. The jury verdict was precisely that figure— not a cent more or less — just an even $40,-000.

Application of the expert’s square footage valuation of the true comparables to the property involved in this suit results in the following:

Tract One (at 360 per sq. ft.) .Subject property: $51,209.28

Tract Two (at 440 per sq. ft.) .Subject property: 62,589.12

Tract Three (at 340 per sq. ft.) .Subject .property: 48,364.32

In order to procure a reversal of this erroneous judgment, it is only necessary that the landowner establish that the inadmissible evidence was reasonably calculated to and probably did cause the rendition of an improper judgment. Pittman v. Baladez, 158 Tex. 372, 312 S.W.2d 210, 216 (1958). I submit that the receipt of the inadmissible evidence in this case was calculated to cause the trial to be materially unfair. Cf. Tamburello v. Welch, 392 S.W.2d 114 (Tex.1965); Perkins v. Freeman, 518 S.W.2d 532 (Tex.1974).

This Court faced the converse of the situation in State v. Nesom, 395 S.W.2d 424, 425 (Tex.Civ.App.—Beaumont 1965, writ ref’d n. r. e.). There, the jury verdict exceeded the maximum estimate of value of the only witness thereon and the court held that the verdict was excessive as a matter of law. The error was cured by requiring a remittitur to the highest value placed thereon by the sole witness. But we have no additur authority so that we are unable to correct the error by adding $8,364.32 to the sum found by the jury. Lacking such power, our only recourse is to reverse the judgment and remand the cause for another trial at which time the jury will receive and consider only admissible evidence of value.

The springboard used by the majority in finding that there is no reversible error is to be found in these words:

“As stated at the beginning of this opinion, the only witness to testify for the landowner was the landowner whose occupation was that of a nurse. She stated that in her opinion the market value of this property was $90,000 without giving a basis for that opinion. On the other hand, the witness called by the School District had twenty-four years’ experience in real estate and appraising.”

In analyzing the quotation, it should be borne in mind that in condemnation suits the opinions of the landowner are admissible. City of Houston v. Collins, 310 S.W.2d 697, 704 (Tex.Civ.App.—Houston 1958, no writ); State v. Loessin, 343 S.W.2d 494, 503 (Tex.Civ.App.—Austin 1961, writ ref’d n. r. e.); M. Rayburn, Texas Law of Condemnation, § 128 at 404 (1960). Likewise, the condemnor’s expert witness was shown to be qualified to express his opinion as to the market value of the property.

The charge to the jury in this case set out the correct rule governing the evaluation of testimony: “You [the jury] are the sole judges of the credibility of the witnesses and the weight to be given their testimony

It is readily apparent that the jury rejected the opinion testimony of the landowner and accepted that of Terry. This was well within the authority of the jury; but, in determining the existence of harmless error, it is inappropriate for this reviewing court to assume a similar function.

I am unwilling to find “no reversible error” has been shown. The cause should be reversed under the rules adopted for our guidance. See, e. g., State v. Chavers, supra (454 S.W.2d at 398); Gomez Leon v. State, 426 S.W.2d 562, 565 (Tex.1968).

       As noted by the majority, the square foot evaluations shown for tracts two and three were the result of mathematical calculations which the expert reduced by a process of extrapolation: taking the known sales price, he reduced the tract valuation by deducting his estimate of the value of the improvements. Tract one, a part of the property being condemned, had no improvements thereon.


source: Caselaw Access Project

author: McCLOUD, Chief Justice.

license: Public Domain

text:
    F. W. WHITE et al., Appellants, v. ROY ROY DAIRY, INC., Appellee.
    No. 4698.
    Court of Civil Appeals of Texas, Eastland.
    Nov. 15, 1974.
    Rehearing Denied Jan. 31, 1975.
    E. L. (Lanny) Hamby, Brown, Hamby & Bancroft, Big Spring, for appellants.
    Pat M. Baskin, Legg, Saxe & Baskin, Midland, for appellee.
   McCLOUD, Chief Justice.

Roy Roy Dairy, Inc., sued F. W. White and B. R. White, individually and as partners, for actual and exemplary damages for breach of contract. The trial court entered judgment based on jury findings against both defendants for actual and exemplary damages. Defendants appeal the exemplary damages award of $4,681.97. We reverse and render.

The record reflects that defendants, F. W. White and B. R. White, owned and operated a dairy and contracted to sell 1354 pounds of “milk base” to plaintiff. All parties were members of Associated Milk Producers, Inc. (A.M.P.I.) and each agreed to execute the appropriate form to effectuate the transfer. After the transfer form was properly executed it was retained in the Abilene office of A.M.P.I., together with plaintiff’s check for the purchase price. Before the transaction was completed B. R. White went to the A.M.P.I. office and asked a secretary, Charlene McLeod, if he could see the executed transfer form. After examining the form he put it in his pocket and told the secretary to return the check to plaintiff. He took the executed form with him when he left the office.

The jury found that defendants breached the contract and awarded plaintiff actual damages. There is no appeal from that award. Defendants contend, however, there is no evidence to support the award of exemplary damages. We agree.

Plaintiff contends it is entitled to exemplary damages because of the jury’s findings that B. R. White fraudulently induced Charlene McLeod to relinquish possession of the transfer form for the specific purpose" of repudiating the contract.

The jury found that when B. R. White asked Charlene McLeod to let him see the transfer form he did not intend to only look at the form, but he intended to remove it from the A.M.P.I. office; that by taking the executed transfer form he intended to repudiate the contract; that when he falsely stated his intentions to Charlene McLeod he intended that she act and rely on such false statement; and that when Charlene McLeod handed the transfer form to B. R. White she was relying on his false statement.

The court in McDonough v. Zamora, 338 S.W.2d 507 (Tex.Civ.App.—San Antonio 1960, writ ref. n. r. e.) announced the general rule that exemplary damages are not recoverable in actions for breach of ordinary commercial contracts, even though the breach is brought about capriciously and with malice. The court discussed in detail the authorities supporting the general rule and its exceptions. Justice Pope concluded:

“ . . . It is believed, however, that the cases which apply the correct rule are those in which punitive damages have been allowed if and only if, a distinct tort is alleged and proved, independent of the contract action.”

See also: 25 C.J.S. Damages § 120; 22 Am.Jur.2d, Damages § 245; Restatement, Contracts, § 342; Williston, Contracts, Vol. III, § 1340 (1921).

In the instant case the distinct tort, independent of the contract action, was committed against Charlene McLeod, who was not a party to the contract. We think exemplary damages for breach of contract should be recoverable only if the tort is committed by the defaulting party against the party seeking exemplary damages.

The judgment is reversed and rendered.


author: CLAUDE WILLIAMS, Chief Justice.

text:
    UNIT, INC. and B. W. Morris, Appellants, v. TEN EYCK-SHAW, INC., Appellee.
    No. 18580.
    Court of Civil Appeals of Texas, Dallas.
    May 8, 1975.
    Rehearing Denied June 5, 1975.

      Michael H. Sebastian, Dallas, for appellants.
    Eddie Vassallo, McKool, Jones, Shoemaker & Vassallo, Dallas, for appellee.
   CLAUDE WILLIAMS, Chief Justice.

Ten Eyck-Shaw, Inc. brought this action to recover $128,272.34 which it alleged was due from Unit, Inc. for labor, material, wares and merchandise provided by plaintiff, as general contractor, in the construction of an office building for Unit, Inc. Plaintiff’s action was on a sworn account as authorized by Texas Rules of Civil Procedure, rule 185. Attached to plaintiff’s petition were various exhibits which were alleged to set forth the goods, wares, merchandise, materials and labor which had been furnished defendant and on which a systematic record had been kept and arising out of business dealings between the parties. B. W. Morris, president of Unit, Inc. was made an additional defendant based upon plaintiff’s allegation that he was a guarantor of the indebtedness. Unit, Inc. filed a general denial and Morris entered a special appearance in which he raised a question concerning the jurisdiction of the court pursuant to Tex.R.Civ.P. 120. Plaintiff filed its motion for summary judgment against defendant Unit, Inc. Following a hearing, the trial court sustained plaintiff’s motion for summary judgment, overruled Morris’s challenge to the jurisdiction, and rendered default judgment against Morris. Both defendants appeal. We shall refer to the parties as they appeared in the trial court.

The primary question presented to us by this appeal is whether the account sued upon by plaintiff is sufficiently stated to constitute prima facie evidence of a sworn account under Tex.R.Civ.P. 185. We have concluded that the answer should be in the negative and, therefore, reverse the trial court’s judgment.

From an examination of the exhibits made a part of plaintiff’s cause of action, it is apparent that the goods and labor which form the basis of the accounts sued upon were to be supplied by the plaintiff pursuant to a contract signed by the parties on August 7, 1967. Although the agreement stated that the construction costs would not be allowed to exceed $1,334,000, additional materials and labor were provided which caused the total cost of the construction project to reach the sum of $1,746,125.51. The account attached to plaintiff’s petition, which is relied upon as a basis for the judgment against both defendants, consists of the owner-contractor agreement signed on August 7, 1967, various correspondence between the defendants and plaintiff and letters written by subcontractors and an accounting firm addressed to the plaintiff. The sum of $1,334,000, as agreed upon by the parties in their original agreement, was intended to be a maximum covering thirteen broad categories of construction expenses set out in article 6 of the agreement. A typical category provides, “materials, supplies, equipment and transportation required for the proper execution of the work, which shall include all temporary structures and maintenance, including sales and other taxes related thereto . . . In a letter written by the plaintiff to defendant Unit, Inc. on January 13,1969, it was stated that this maximum contract price would be increased to provide for the following expenses: (1) Sam P. Wallace Company’s subcontract, $58,000 for plumbing, high pressure duct and mixing boxes; (2) Electricial Construction Corporation’s subcontract, $47,618 for lighting fixtures, lamps, panels, transformers and bus ducts.

In a letter to defendant Unit, Inc. dated August 16, 1971, plaintiff requested final payment of $128,272.34. This amount was said to be calculated from various figures found in an enclosed cost sheet. No cost sheet containing any detailed figures is included in the record.

In order to support a judgment on a sworn account under Tex.R.Civ.P. 185, whether the judgment be by default or a summary judgment, the account must show upon its face with reasonable certainty the nature of each item sold, the date of each sale and the reasonable charge therefor. Big K Furniture Co. v. Covey Co., 511 S.W.2d 329, 330 (Tex.Civ.App.-Austin 1974, no writ); Benthall v. Goodwin, 498 S.W.2d 510, 512 (Tex.Civ.App.-El Paso 1973, no writ); United States Insulation Sales Corp. v. Jones-Blair Co., 491 S.W.2d 226, 227 (Tex.Civ.App.-Dallas 1973, no writ); Williamsburg Nursing Home, Inc. v. Paramedics, Inc., 460 S.W.2d 168, 170 (Tex.Civ.App.-Houston [1st Dist.] 1970, no writ); Hancock v. O.K. Rental Equipment Co., 441 S.W.2d 955, 956 (Tex.Civ.App.-San Antonio 1969, no writ); Carruth v. Wix Corp., 409 S.W.2d 938, 941 (Tex.Civ.App.-Beaumont 1966, writ ref’d n. r. e.); Anderson v. Hake, 300 S.W.2d 663, 664 (Tex.Civ.App.-Dallas 1957, no writ); accord, Texan Man’s Shop, Inc. v. Nunn-Bush Shoe Co., 401 S.W.2d 716, 718 (Tex.CivApp.-Corpus Christi 1966, no writ); Boucher v. City Paint & Supply, Inc., 398 S.W.2d 352, 355 (Tex.Civ.App.-Tyler 1966, no writ); Brownson v. New, 259 S.W.2d 277, 280 (Tex.Civ.App.-San Antonio 1953, writ dism’d); Becker, Smith & Page, Inc. v. Cameron & Co., 22 S.W.2d 951, 952 (Tex.Civ.App.-Waco 1929, writ dism’d).

The purported account attached to the plaintiff’s petition does not itemize in reasonable qualitative nor quantitative terms the labor or materials which constitute the total cost of construction of $1,746,125.51. Since no fixed contract price was agreed on, plaintiff was required to specify in its account the specific items of cost claimed before defendant was required by Rule 185 to file a sworn denial indicating which items are “not just and true.”

A plaintiff is unable to establish a prima facie case warranting a summary judgment in the absence of a sworn denial if the account fails to conform to the requisites of Tex.R.Civ.P. 185. When a prima facie case has not been established then a general denial, such as the one filed by defendant Unit, Inc., puts in issue all material facts in regard to plaintiff’s allegations of goods, wares and merchandise sold and delivered to the defendants. Anderson v. Hake, 300 S.W.2d 663, 664 (Tex.Civ.App.-Dallas 1957, no writ). Plaintiff, therefore, has failed to demonstrate by summary-judgment proof that as a matter of law there is no genuine issue of fact as to one or more of the essential elements to plaintiff’s cause of action. Gibbs v. General Motors Corp., 450 S.W.2d 827, 828 (Tex.1970).

An account which is insufficient on its face to constitute a sworn account cannot support a judgment by default against a direct attack. United States Insulation Sales Corp. v. Jones-Blair Co., 491 S.W.2d 226, 227 (Tex.Civ.App.-Dallas 1973, no writ); Williamsburg Nursing Home, Inc. v. Paramedics, Inc., 460 S.W.2d 168, 170 (Tex. Civ.App.-Houston [1st Dist.] 1970, no writ).

Plaintiff contends that the case of Magic Carpet Co. v. Pharr, 508 S.W.2d 696 (Tex.Civ.App.-Dallas 1974, no writ) is authority for proposition that to sue on sworn account, it is not necessary to show with specificity, the price, value and quantity of the goods or services provided. We cannot agree. In Magic Carpet, plaintiff’s petition, although presented in the form of a sworn account, also alleged that defendant had acknowledged the justness of the account. The petition was, therefore, effective to establish a suit on an account stated. It is well established that when a suit is brought on an account stated, proof of plaintiff’s delivery of goods or rendition of services to defendant, and defendant’s acknowledgment of a certain sum as due to plaintiff is sufficient for a prima facie case, without other proof of price, quantity or specific items. Id. at 697. Here plaintiff’s action was based strictly on a verified account; therefore, the rule set out in Magic Carpet is inapplicable.

Plaintiff advances the contention that if it is determined that it is not entitled to recover the claim as a sworn account then it was entitled to recover under the theory of a stated account. This contention is without merit because plaintiff’s pleadings do not support its cause of action as an account stated. Apparently plaintiff’s theory is that its letter to defendant Unit, Inc., dated August 16,1971, requesting final payment constitutes a stated account because it contains an acknowledgment of the correctness of the amount demanded signed by defendant Morris. The petition, however, does not allege that defendants acknowledged the amount demanded to he justly due and owing. The pleadings simply assert that “defendants have failed to pay the total sum of money due as shown by the attached exhibits.” It is insufficient to merely allege that an account was presented to the defendant and that they have failed or refused to pay it. To bring an action on an account stated it would be incumbent upon plaintiff to allege in his petition that the defendant admitted the correctness of the account and that he expressly or impliedly assented to it. Reed v. Harris, 37 Tex. 167, 169 (1872); Felker v. Gulf Coast Orchards, Co., 81 S.W.2d 1044, 1045 (Tex.Civ.App.-San Antonio 1935, writ dism’d); Scofield v. Lilienthal, 268 S.W. 1047, 1049 (Tex.Civ.App.-Waco 1925, no writ).

We sustain defendants’ points challenging the sufficiency of plaintiff’s sworn account petition to constitute prima facie evidence of the account under Tex.R.Civ.P. 185. This requires a reversal of the judgment both as to the summary judgment and to the default judgment. We need not pass upon the remaining points advanced by defendants.

We desire to comment on a matter concerning the record in this case. After the defendants had ordered the district clerk to prepare the transcript, plaintiff directed the clerk to include in such transcript “all correspondence in the court’s file without regard to date.” Because of the request made by plaintiff, the district clerk included numerous letters and documents in the transcript which are wholly unnecessary to the consideration of any point of error advanced by either party and which resulted in a two-volume transcript containing a total of two hundred thirty-nine (239) pages. This voluminous record does not comply with Tex.R.Civ.P. 376 and has significantly increased the burden of this court in attempting to consider the points of error presented.

The judgment of the trial court is reversed and remanded.


author: AKIN, Justice.

text:
    TRINITY UNIVERSAL INSURANCE CO., Appellant, v. Bobby R. FULLER and Fuller & Peyton Insurance Agency, Appellees.
    No. 18581.
    Court of Civil Appeals of Texas, Dallas.
    May 15, 1975.
    Rehearing Denied June 5, 1975.
    Larry L. Gollaher, Thompson, Coe, Cousins & Irons, Dallas, for appellant.
    Robert H. Frost, Vial, Hamilton, Koch, Tubb, Knox & Stradley, Dallas, for appel-lees.
   AKIN, Justice.

This case concerns the liability of an insurance agent to his principal for failure to follow an instruction to obtain an endorsement reducing the coverage of a policy of fire insurance. The suit was originally brought by the insured. Hoover & Sons, Inc. sued Trinity Universal Insurance Company on a fire insurance policy in the amount of $25,000 for a loss occurring on December 10,1972. Trinity admitted it was liable to the insured in the amount of $10,-000 but denied any further liability on the ground that Trinity had instructed its agent, Fuller & Peyton Insurance Agency prior to the fire to reduce the coverage on the building from $25,000 to $10,000. Trinity filed a third party action against its agent Fuller for damages alleging that Fuller’s failure to comply with Trinity’s instruction to reduce the coverage was a breach of Fuller’s contract with Trinity. This breach, Trinity contends, resulted in its loss in excess of $10,000. In the alternative, Trinity alleged that Fuller was negligent in failing to obtain the insured’s signature on the reduction endorsement, thereby proximately causing Trinity to suffer the additional loss of $14,000.

The pertinent jury findings are as follows: that the loss sustained by virtue of the fire was $24,000; that a reasonable time for Fuller to comply with Trinity’s instructions to reduce coverage would have been on or before December 4, 1972; that Fuller’s failure to comply with Trinity’s instructions was negligence; that such negligence of Fuller was a proximate cause of the loss sustained by Trinity in excess of $10,000; that the failure of Trinity to cancel the entire policy in question prior to the fire was negligence; that such negligence on the part of Trinity was a proximate cause of Trinity’s loss in excess of $10,000; and that Trinity did not waive its instructions to Fuller to obtain the insured’s signature on an endorsement reducing the coverage on the building to $10,000. Based upon these findings, the trial court entered judgment in favor of the insured in the amount of $24,000 and denied Trinity recovery against Fuller on its third party action.

Trinity brings this appeal from the judgment denying it recovery against Fuller.

Two questions are presented by this appeal: (1) Is Trinity entitled to judgment under the evidence here for breach of contract as a matter of law? (2) Is Trinity barred from recovery because it failed to mitigate damages? We answer the first question in the affirmative and the second in the negative and, therefore, reverse and render the judgment of the trial court.

FACTS

Without any previous knowledge by Trinity, agent Fuller issued Trinity’s policy insuring the building of Hoover & Sons for $25,000. After Trinity inspected the premises, Trinity prepared an endorsement reducing coverage to $10,000 and instructed agent Fuller to obtain the signature of the insured on the endorsement. Fuller testified that he received the endorsement reducing Trinity’s coverage from $25,000 to $10,000 shortly after June 30, 1972. Agent Fuller further stated that he understood upon receipt of the reduction endorsement that Trinity expected him to obtain the signature of the insured and return the signed endorsement to Trinity. Fuller admitted failure to follow these instructions and on September 20, 1972, he received the first of four letters from Trinity requesting the signed endorsement. Trinity made the same request of Fuller on October 22, 1972, November 3, 1972, and December 1, 1972, but according to agent Fuller he “just could not find time to get the endorsement signed by the insured and return it to Trinity.” At no time did Fuller advise Trinity that he had not obtained the insured’s signature on the endorsement or that he would not do so. Fuller admitted further that he did not expect Trinity to obtain the insured’s signature directly, since reduction endorsements are always handled by the agent. It was not until after the fire occurred on December 10, 1972, that agent Fuller finally complied with Trinity’s instructions by sending the endorsement to the insured requesting its signature. The insured, of course, did not sign the endorsement; hence, this litigation ensued.

BREACH OF CONTRACT

Based upon these facts, Trinity argues that the trial court erred in failing to render judgment for it against agent Fuller because the verdict of the jury and the uncontroverted evidence established agent Fuller’s breach of contract as a matter of law. The pertinent part of the agency contract between Trinity and agent Fuller provides:

The agent is authorized to solicit lines of insurance specified by the company for the territory above described, and to countersign, issue, renew and consent in writing to the transfer of insurance policies when duly authenticated, and to collect premiums for transmission to the company, and to perform generally the duties of an agent as herein outlined and in such manner as shall best promote the interests of the company, being governed in all respects by the company’s manuals and subject to the rules and regulations of said company and to such instruction as may from time to time be given by its authorized representative. [Emphasis added.]

This contract clearly imposed upon Fuller the duty to carry out instructions given by Trinity. Trinity contends that agent Fuller violated this contract in failing to procure the signature of the insured on the reduction endorsement as requested. We agree. The undisputed evidence established that Fuller failed to carry out this instruction. The jury found that Fuller was given a reasonable time to respond to Trinity’s instruction and that this failure to follow instructions caused Trinity to sustain a loss in excess of $10,000.

A similar fact situation was presented in National Automobile and Casualty Insurance Co. v. Allco Insurance Agency, 403 S.W.2d 174 (Tex.Civ.App.—Austin 1966, no writ). In that case, as here, an insurer sought indemnity from its agent for an amount paid to satisfy a claim on an insurance policy because the agent failed to follow the insurer’s instructions to cancel the policy before liability upon it arose. The court stated that if the agent had a duty to follow the instructions to cancel the policy “then it was the result of contractual relations between the parties and a breach of such duty would be a breach of contract.” Id. at 177. See also, Cagle v. Commercial Standard Insurance Co., 427 S.W.2d 939 (Tex.Civ.App.—Austin 1968, no writ).

MITIGATION OF DAMAGES

Fuller argues that Trinity could have cancelled the insurance policy in question as well as Fuller, and, therefore, concludes that Fuller is relieved of liability. Fuller bases this assertion on the jury’s findings that Trinity’s negligence was the proximate cause of its loss. Fuller’s contention is without merit because Trinity had no duty to mitigate damages here. We hold that Trinity’s right to cancel or reduce the limits of the policy is no defense for the agent in an action for breach of contract by Trinity. The jury’s responses to these special issues could be said to constitute contributory negligence on the part of Trinity. Contributory negligence, however, is not a defense to a breach of contract. Westchester Fire Insurance Co. v. Bollin, 106 S.C. 45, 90 S.E. 327 (1916); Washington v. Mechanics & Traders Insurance Co., 174 Okla. 478, 50 P.2d 621 (1935); American Insurance Co. v. Martinek, 203 Mich. 108, 168 N.W. 982 (1918); St. Paul Fire & Marine Insurance Co. v. Bigger, 105 Kan. 311, 182 P. 184 (1919); Phoenix Insurance Co. v. Heath, 90 Utah 187, 61 P.2d 308 (1936); Hanover Insurance Co. v. St. Paul Fire & Marine Insurance Co., 359 F.Supp. 591 (W.D.La.1973).

Fuller argues that the contributory negligence finding on the part of Trinity has the same effect as establishing the defense of avoidable consequences. We do not agree. Even if Fuller’s position was correct, he could not establish the defense of avoidable consequences. The Texas Supreme Court in Walker v. Salt Flat Water Co., 128 Tex. 140, 96 S.W.2d 231, 232 (1936) stated the rule as follows:

Where a party is entitled to the benefits of a contract and can save himself from damages resulting from its breach at a trifling expense or with reasonable exertions, it is his duty to incur such expense and make such exertions; and in such instances he can only charge the party in default with such damages as he could not have prevented with reasonable exertions and expense; but where the party in default was in duty bound to prevent damages, and had equal opportunity with the person injured for performance, and equal knowledge of the consequences of nonperformance, he cannot, while the contract is in force and effect, be heard to say that the plaintiff might have performed for him, and thus avoided such damages. [Emphasis added.]

It was Fuller’s duty to reduce the coverage on the building and Fuller had an equal if not greater opportunity than Trinity to effect that reduction or to cancel the policy. Fuller knew that Trinity was relying on him to take that action. Since Fuller failed in this duty, he cannot now look to Trinity for relief from his own breach of duty.

The doctrine of avoidable consequences arises only if the victim of the wrongdoer’s act has knowledge of the fact which make avoidance of the consequence necessary, and if the damages can be avoided with only slight expense and reasonable effort. Here, there is no evidence that Trinity knew that the coverage had not been reduced by Fuller. In fact, Fuller himself testified that he never advised Trinity that he had not obtained the insured’s signature on the reduction endorsement, or that he would not do so. Without such knowledge, Trinity had no duty to avoid the consequences by reducing or cancelling the policy. Indeed, Trinity had a right to rely on its agent to carry out his duties under the agency contract. The cases cited to us by Fuller are not in point for the reason that in each case there was actual knowledge of the wrongdoer’s breach of contract prior to the occurrence of the damage. The controlling rule is stated by Mr. Justice Pope in Polis v. Alford, 273 S.W.2d 79, 80 (Tex.Civ.App.—San Antonio 1954, writ ref’d), as follows:

Alford had no prior notice, nor any reason to believe that Polis would violate his contract and fail to pay the flat rate. Until February 1st Polis could have paid the flat rate, and until that date Alford could reasonably assume that Polis would comply with his agreement rather than breach it. .
While Alford should reasonably avoid the consequences of a breach, he is not bound to avoid the breach itself. 5 Williston on Contracts § 1353 (1961).

See also, Western Union Telegraph Co. v. Federolf, 145 S.W. 314, 316 (Tex.Civ.App.—San Antonio 1912, no writ); Otto Goedecke, Inc. v. Henderson, 388 S.W.2d 728, 730 (Tex. Civ.App.—Amarillo 1965, writ ref’d n. r. e.). We conclude that no duty existed upon Trinity to cancel or reduce the policy coverage, and, therefore, Trinity is entitled to its damages occasioned by Fuller’s breach of the agency contract.

We reverse the judgment of the trial court and render judgment for Trinity and against the partnership of Fuller & Peyton Insurance Agency for the sum of $14,000, with interest from May 7, 1973, at the rate of six percent per annum and for all costs.

Reversed and rendered.


author: MASSEY, Chief Justice.

text:
    U. S. ENTERPRISES, INC., Appellant, v. Dean I. DAULEY, Individually, et al., Appellees.
    No. 17621.
    Court of Civil Appeals of Texas, Fort Worth.
    May 16, 1975.
    Rehearing Denied June 20, 1975.
    Sears, Parker, Quisenberry & Spurlock, and Dean Spurlock, Fort Worth, for appellant.
    Thorne, Thorne & Robertson, Inc., and Michael A. Robertson, Grand Prairie, for appellees.
   OPINION

MASSEY, Chief Justice.

This is an appeal from a a summary judgment granted upon motion of the defendant Dean I. Dauley, et al. They will be for convenience referred to hereinafter as Dauley Enterprises.

Plaintiff was U. S. Enterprises, Inc., hereinafter termed plaintiff. Plaintiff brought suit for specific performance of contractual promise made July 17, 1972 to convey land in Wise County, Texas, against Coke L. Gage and wife on May 24, 1973. After that suit was brought and while it was pending plaintiff discovered that the Gages had made a sale of land, deemed a part of its own contract, to Dauley Enterprises. By amendment filed December 12, 1973 plaintiff joined Dauley Enterprises as party defendant to its pending suit.

Dauley Enterprises had, in fact, purchased Wise County land from the Gages with knowledge of plaintiff’s pending suit against them. The land purchased by it was described in its deed by metes and bounds and with specification as land within the A. J. Walker Survey, Abstract 860. Without doubt the land purchased by Dau-ley Enterprises was either immediately within or immediately without the total body of land plaintiff believed it had contracted to purchase from the Gages. It was on the theory that plaintiff had no valid and enforceable contract with the Gages which in any way affected purchase by Dauley Enterprises that such parties consummated the transfer of title to land in the A. J. Walker Survey. Dauley Enterprises was placed upon actual notice of plaintiff’s claim that by contract the Gages were obligated to deliver the same land to plaintiff at a time prior to that it consummated its purchase from the Gages. Dau-ley Enterprises was furthermore aware of the suit and of the lis pendens plaintiff had placed on file pursuant to its claim.

After being joined as a party defendant by plaintiff in its pending suit against the Gages, Dauley Enterprises moved for summary judgment. Upon hearing summary judgment for Dauley Enterprises was granted. There was severance so that plaintiff’s suit against the Gages might remain pending and the summary judgment become a final and appealable judgment. Plaintiff appealed therefrom.

We affirm the summary judgment.

A theory advanced by Dauley Enterprises was that since the evidence, undisputed for summary judgment purposes, showed that plaintiff had no valid and enforceable contract with the Gages in any event, because there was insufficient description by the Statute of Frauds to any Wise County land, plaintiff could not go through the- Gages and against it. Since a right to maintain plaintiff’s case against the Gages would be an essential prerequisite to any right to maintain a suit against Dauley Enterprises as successor to rights and/or liabilities incident to its purchase, we examined the state of facts in light of the law as recognized by the Supreme Court in Pickett v. Bishop, 148 Tex. 207, 223 S.W.2d 222 (1949).

In Pickett v. Bishop, supra, it is stated to be settled law that the condition of the Statute of Frauds is satisfied relative to the description of land contracted to be purchased if the memorandum of writing, despite failure to locate the property by metes and bounds, etc., sets out such words as “my property”, “my land”, or “owned by me”; that the land description is sufficient because when it is shown by extrinsic evidence that the party to be charged owns a tract, and only one tract of land answering the description in the memorandum, the stated ownership of the property is in itself a matter of description which leads to the certain identification of the property. With this done, the description exhibits compliance with the terms of the rule that the writing must furnish within itself, or by reference to some other existing writing, the means or data by which the particular land to be conveyed may be identified with reasonable certainty.

Plaintiff’s 1972 contract with the Gages stated on its face that the 10 different parcels of land acreage contracted to be conveyed to plaintiff were in Surveys, as follows: (a) J. G. Bullock, Abstract No. 79, (b) David Moses, Abstract No. 537, and (c) J. H. Moore, Abstract No. 538, all in Wise County, Texas. Written into the contract above the signature of the Gages was the following: “Said contract includes all of the land owned in said surveys above described exclusive of the 200 acres in the J. H. Moore Survey described in Paragraph 15 hereof.”

Examination discloses that the 200 acres in the J. H. Moore Survey was land capable of segregation out of the contract and thus a separate and independent contract from the remainder having application to the land in the Bullock and Moses Surveys. The provisions relative thereto, while they might afford to plaintiff the right to an escape from the entire contract on the theory of failure of consideration, may be disregarded for purposes of appeal by plaintiff from the summary judgment awarded Dau-ley Enterprises. Here the question is upon the matter of plaintiff’s right to enforce specific performance — not only against the Gages, but through them — against Dauley Enterprises.

If on a trial on the merits plaintiff could show that the land sold by the Gages to Dauley Enterprises lay within the Bullock and Moses Surveys it might be entitled to prevail against Dauley Enterprises by reason of the notice and knowledge passed by the latter at time of the purchase. Unless it could show this, however, it could not so prevail. If, upon a Defendant’s Motion for Summary Judgment inability to make such proof be demonstrated it would be proper to grant the motion. Our holding is that plaintiff’s inability was proved and that summary judgment was proper.

Dauley Enterprises’ proof showed that its consummated contract of purchase from the Gages was of land lying within the A. J. Walker Survey and that plaintiff’s contract did not entitle it to any specific performance to enforce conveyance of any land in that Survey. As the defendant-movant for summary judgment Dauley Enterprises was not required to show more. Upon such a showing made it became incumbent upon plaintiff, as respondent to the Dauley motion, to come forward with something affirmative to show existence of a fact issue to be tried.

Plaintiff did attempt to do this, but it might properly be said that it showed no more than the following: (1) that its representative was shown property which in fact did include that later purchased by Dauley Enterprises from the Gages, (2) that a “meeting of the minds” with the Gages was arrived at upon the price to be paid per acre by plaintiff as the plaintiff’s consideration, and upon the property and location thereof which would be delivered by the Gages as their return consideration, (3) that a map was drawn outlining location and boundaries of the property which was to be contracted to be conveyed, with agreement that it was to be attached to the memorandum of contract and made a part thereof, and that on such map the tract later conveyed by the Gages to Dauley Enterprises was included and marked by color identical to the color used to denominate the land owned by the Gages in the David Moses Survey, (4) that in the written portion of the memorandum of contract there was omission in that the aforesaid property was not included (though the map Exhibit “A” attached to and made a part of the contract showed it in color as part of the David Moses Survey), since it set out merely the parties’ sale and purchase agreement relative to land located in surveys other than that owned by the Gages in the A. J. Walker Survey.

Because there was absence of any description of land in the Walker Survey which would satisfy the description requirement of the Statute of Frauds, plaintiff could not enforce as against the Gages an obligation to convey any land in that Survey. It would necessarily follow that plaintiff could have no right to compel Dauley Enterprises to deliver it up (as to the Gag-es) so that it might be conveyed to plaintiff.

The contract was wholly executory in so far as the land to be conveyed is concerned or in so far as the consideration promised by the Gages is involved. Therefore it is not capable of any forced reformation because of the Statute of Frauds. Unlike the capability of enforcement which would have been existent were the land in dispute within the Moses Survey (by the doctrine in Pickett v. Bishop, supra), there is demonstrated incapability of enforcement by the Statute of Frauds of any obligation to convey the disputed land because (1) there is nothing in the written portion of the contract which in any way includes it, (2) the map attached to and made a part thereof is insufficient to show such description that it might be located and defined, (3) there is nothing of written nature to which the contract makes reference by aid of which the extent and description of land in the A. J. Walker Survey might be determined, and (4) even if there were such the written portion of the contract is specified with particularity that it covers land within the J. G. Bullock, David Moses, and J. H. Moore Surveys (that in the Moore Survey capable of being severed out for purposes of this proceeding) and thus would control over the general description, within which there would even be difficulty in enlarging it to include the land in the A. J. Walker Survey.

Plaintiff seeks to have treated as within its contract with the Gages the parcel in the A. J. Walker Survey because that was shown to it at time prior to entry into written contract as part of the whole of the land contemplated to be sold to it by the Gages, and the contract was executed with the intention and in the belief by both parties thereto that it was land included in the contract. Because of the Statute of Frauds this is not enough to entitle plaintiff to enforce conveyance of real estate.

Judgment is affirmed.


author: GUITTARD, Justice.

text:
    Carroll COBB, Appellant, v. TEXAS DISTRIBUTORS, INC., Appellee.
    No. 18586.
    Court of Civil Appeals of Texas, Dallas.
    May 8, 1975.

      Crenshaw, Dupree & Milan, Cecil C. Kuhne, Lubbock, for appellant.
    Matthews & Matthews, Jay J. Madrid, Dallas, for appellee.
   GUITTARD, Justice.

Texas Distributors, Inc. sued Carroll Cobb on his guaranty of the debts of Western United Homes, a corporation. The trial court, sitting without a jury, rendered judgment for plaintiff for the amount of the debt and for an attorney’s fee, and the defendant guarantor appeals. We hold (1) that the document is a general guaranty for the benefit of creditors rather than a special guaranty for the sole benefit of a credit-rating agency; (2) that the evidence shows reliance by plaintiff on the guaranty; (3) that extension of credit in reliance on the guaranty was a sufficient acceptance by plaintiff, without formal notice of acceptance; and (4) that the defendant guarantor cannot complain here of recovery of an attorney’s fee, since he did not object to such recovery in the trial court. Accordingly, we affirm the judgment.

1. Scope of the Guaranty

The defendant guarantor contends that the guaranty in question is a special guaranty for the sole benefit of Dun & Bradstreet, Inc., a credit-rating agency. This contention is not supported by the language of the document, which is as follows:

FORM FOR AN INDIVIDUAL GUARANTEEING THE DEBTS OF A CORPORATION

WHEREAS, the undersigned Carroll Cobb is a stockholder of Western United Homes and through ownership of capital stock of the said Corporation, has an important interest in the profits of the latter; and WHEREAS for the convenient and successful conduct of the business of the said Corporation it is necessary that it should receive credit in respect to its contracts;

NOW, THEREFORE, I, the undersigned, do agree that I shall — until due, written notice to the contrary be served upon Dun & Bradstreet, Inc., and existing creditors of the aforesaid Corporation— be and continue liable for the discharge of all contract obligations of the aforesaid Corporation. And it is further agreed by the undersigned that Dun & Bradstreet Inc., may rely upon this guarantee in basing credit ratings of the aforesaid Corporation, and may, in their discretion, furnish their subscribers with copies, or the substance of the foregoing.

We construe this document as a general guaranty of the debts of the corporation. The operative language is: “I, the undersigned, do agree that I shall ... be and continue liable for the discharge of all contract obligations of the aforesaid Corporation.” The only limitation on this language is the provision for termination: “until due, written notice to the contrary be served upon Dun & Bradstreet Inc., and existing creditors of the aforesaid Corporation.” This provision for notice to creditors as well as to Dun & Bradstreet is a further indication that the guaranty is not for the benefit of Dun & Bradstreet alone.

No limitation on the scope of the guaranty is implied by the further provision: “and it is further agreed by the undersigned that Dun & Bradstreet, Inc., may rely upon this guarantee in basing credit ratings of the aforesaid Corporation, and may, in their discretion, furnish their subscribers with copies, or the substance of the foregoing.” This provision indicates that the guaranty was furnished to induce Dun & Bradstreet to give the corporation a favorable credit rating. Dun & Bradstreet, however, could not base a favorable credit rating on the guaranty if the only effect of the guaranty was to assure payment of the debts of the corporation to Dun & Bradstreet. Dun & Bradstreet is in the business of giving credit ratings to prospective creditors, and it could not have relied on the guaranty in making the credit rating of the corporation unless the guaranty was made for the benefit of the creditors who might rely on the rating. Dun & Bradstreet had no dealings with the corporation that would put it in the position of a creditor, so far as this record shows. If the guaranty were construed to be for the benefit of Dun & Bradstreet alone, it would be meaningless. Consequently, we construe it as a general guaranty for the benefit of all creditors of the corporation.

2. Reliance on Guaranty

The defendant guarantor contends that the evidence fails to show that plaintiff relied on the guaranty in extending credit to the corporation for the goods listed in the account sued on. Defendant points out that the guaranty was signed May 14, 1971, but that in April 1971, plaintiff began selling merchandise to the corporation on the basis of a ten-thousand-dollar line of credit. Defendant argues further that plaintiff could not have relied on the guaranty because plaintiff did not know about the guaranty until early in 1972, and plaintiff’s credit manager admitted that plaintiff did not rely on the guaranty until May or June 1972. We hold that the evidence is sufficient to support the trial court’s implied finding that the goods delivered after June 1972, were sold in reliance on the guaranty. According to the testimony of plaintiff’s credit manager, plaintiff made the decision in May or June of 1972 to continue to sell to the corporation on credit because of this guaranty. The account sued on shows that the total charges for merchandise sold after June 1972, amounted to $10,153.20. After allowing credits for defendant’s payments, the balance originally sued for was $8,081.52, and an amended petition allowing a further credit alleged the remaining balance to be $4,040.76.

Defendant contends that the account was not admissible in evidence because it did not show the complete dealings between the parties and, therefore, did not show that the final amount owed by the corporation was greater than the balance owed at the time plaintiff began relying on the guaranty. Defendant’s theory is that unless the amount of the outstanding balance was increased after plaintiff began relying on the guaranty, plaintiff sustained no damage in reliance on the guaranty.

This theory assumes that plaintiff would have continued to sell merchandise to the corporation on credit without any guaranty, so long as the outstanding balance did not increase. The trial court was at liberty to reject this assumption. Plaintiff was never bound to sell merchandise to the corporation on credit. After June 1972, when, according to the credit manager, plaintiff began to rely on the guaranty, plaintiff could have refused to sell any more merchandise until it had been paid for all merchandise previously sold. It did not do so, but made the decision to continue to sell merchandise to the corporation on credit in reliance on the guaranty. The amount of merchandise sold after June 1972, was substantially in excess of the amount sued for. Consequently, the transactions that occurred before plaintiff began relying on the guaranty are immaterial to this suit. Accordingly, we hold that the account was properly admitted and that this account, together with the testimony of plaintiff’s credit manager, is sufficient to support the trial court’s implied finding that all merchandise sold to the corporation after June 1972, was sold in reliance on the guaranty, regardless of whether the balance of indebtedness was increased or reduced after that time.

3. Acceptance of Guaranty

Defendant guarantor contends that the guaranty never became a binding contract because plaintiff failed to give notice to him that it accepted the guaranty or that it would rely on it. We conclude that in the case of an unconditional guaranty, such as that now before us, which does not by its terms require notice of acceptance, no such notice is necessary. Sale of goods on credit in reliance on the guaranty is in itself sufficient acceptance. American Surety Co. v. Whitehead, 45 S.W.2d 958, 961 (Tex.Comm’n App.1932, holdings approved); Tilt-Kenney Shoe Co. v. Haggarty, 43 Tex.Civ.App. 335, 114 S.W. 386 (1906, no writ); 1 Corbin on Contracts § 68 (1963), and see Eastman Oil Well Survey Co. v. Hamil, 416 S.W.2d 597, 604 (Tex.Civ.App.—Houston 1967, writ ref’d n. r. e.).

The cases cited by defendant in support of his contention that notice of acceptance is required involved guaranties that were construed to be conditioned on something other than extension of credit. Wilkins v. Carter, 84 Tex. 438, 19 S.W. 997 (1892); Mayfield v. Wheeler, Geiger & Co., 37 Tex. 256 (1873). Even if some kind of notice to the guarantor is regarded as a condition of liability, as distinguished from a requisite of a valid contract (see 1 Corbin, supra, § 69), the guarantor here is not in a position to assert that plaintiff was required to notify him that it was relying on the guaranty in continuing to sell to the corporation on credit, since defendant, as an officer of the corporation, presumably had access to information concerning the corporation’s purchases from plaintiff.

Finally, defendant guarantor contends that in awarding an attorney’s fee against him, the trial court erred because the guaranty contract made no provision for an attorney’s fee. We overrule this contention because defendant does not show that he made any objection to the award of an attorney’s fee in the trial court. So far as appears, he did not except to the claim for attorney’s fee in the petition, nor did he object to the inclusion of the fee in the judgment. His motion for new trial contains no complaint on this point. Although formal exceptions are not necessary under Rules of Civil Procedure, rule 373, that rule requires that the complaining party make known to the trial court his objection and his grounds therefor, unless he had no opportunity to object. Otherwise, he cannot raise the objection for the first time on appeal. Lewis v. Texas Employers’ Insurance Ass’n, 151 Tex. 95, 246 S.W.2d 599, 600 (1952); Whatley v. Whatley, 493 S.W.2d 299, 304 (Tex.Civ.App.—Dallas 1973, no writ).

All other points of error raised by defendant have been considered and are overruled.

Affirmed.


text:
    ACOUSTICAL SCREENS IN COLOR, INC., Appellant, v. T. C. LORDON COMPANY, INC., Appellee.
    No. 18589.
    Court of Civil Appeals of Texas, Dallas.
    May 15, 1975.
    Rehearing Denied June 12, 1975.

      David A. Newsom, Green, Gilmore, Crutcher, Rothpletz & Burke, Dallas, for appellant.
    Robert Harms Bliss, Dallas, for appellee.
   CLAUDE WILLIAMS, Chief Justice.

T. C. Lordon Company, Inc. (hereinafter called “Lordon”), brought this action against W. A. Hoover and Acoustical Screens in Color, Inc. (hereinafter called “Acoustical”), seeking to recover the sum of $25,170, which had been advanced by Lor-don to Hoover for the purpose of promoting the company known as Acoustical. Lordon alleged that Hoover had promised to repay all of the money advanced or, in the alternative, that judgment should be rendered for the amount so advanced on the theory of money had and received. Acoustical filed a counterclaim for damages based upon alleged fraud by Lordon. At the conclusion of the testimony, the trial court rendered an instructed verdict and judgment against Hoover in the amount of $4,650. Hoover does not appeal from that judgment. The case was submitted on special issues which were answered by the jury favorable to Acoustical’s claim for relief based upon fraud. The trial court sustained Lordon’s motion to disregard certain special issues and rendered judgment non obstante veredicto in favor of Lordon and against Acoustical in the sum of $20,500. Prom this judgment, Acoustical appeals. We affirm.

In its only point on appeal, appellant Acoustical attacks the action of the trial court in rendering judgment non obstante veredicto. It argues that there was sufficient evidence in the record to support the jury’s answers to the questions concerning fraud and, therefore, the court should have rendered judgment in its favor for the amount of actual and exemplary damages found by the jury. Appellee contends that the trial court correctly disregarded the answers of the jury to the issues concerning fraud since the record demonstrates, as a matter of law, that no fraud existed and, therefore, the issues submitted were immaterial. Appellee also argues that the trial court correctly gave it a judgment in the sum of $20,500 for money which, in equity and good conscience, should be returned to it by Acoustical.

Proper resolution of the questions presented requires a review of the material facts. In 1971, Hoover began building office divider screens with high acoustical qualities. He decided to go into the business of manufacturing and marketing this product but did not have sufficient funds to finance the business. In January 1972, he contacted Charles Harding, representative of appellee Lordon, and entered into a series of discussions concerning the possibility of Lordon participating with Hoover in the manufacturing and marketing of screens. As a result of these meetings, Lordon loaned Hoover the total sum of $4,650, which was used to cover Hoover’s expenses incurred in developing the screens and in incorporating his business under the name of Acoustical. Acoustical was incorporated in March 1972, and, thereafter, Lordon advanced to Acoustical several checks for operating capital. During the months of May, June and part of August 1972, Harding, acting as representative for Lordon, and Hoover, acting as president and sole shareholder of Acoustical, negotiated an oral agreement by which Lordon would purchase stock in Acoustical from Hoover. This stock purchase agreement was later to be reduced to writing which would set forth the specific terms agreed upon. Hoover testified that he requested each of the checks issued by Lordon, endorsed each check on behalf of Acoustical, and used the proceeds of each check to pay accounts receivable of Acoustical incurred in the manufacture of its product and to meet its payroll. It is undisputed that none of the $20,500 was ever repaid Lordon nor did Lordon receive anything of value in exchange for the money. It is also undisputed that Hoover did not consider the money to be a gift. There was, however, a divergence of views between Hoover and Harding as to the exact terms and provisions of the oral stock purchase agreement.

Harding testified that the original agreement which he made with Hoover was that Lordon would, at a subsequent date, make Hoover an offer concerning the purchase of stock in Acoustical, and that if Hoover did not see fit to accept the offer, then Hoover would repay the money already advanced by Lordon. Harding testified that after a number of advances were made, but prior to the final advance of $12,000, Hoover and Lordon reached the following agreement: Lordon would acquire one hundred percent of Acoustical stock for the consideration of an employment agreement whereby, over a five-year period, Hoover would earn a forty percent interest in the company, if the business accumulated a $150,000 earned surplus during that period.

Hoover testified that Harding made him an offer whereby Lordon was to invest money in Acoustical in exchange for sixty percent of Acoustical stock. Hoover said that he subsequently agreed to the sixty-forty split with the further requirement that he would be left in charge of manufacturing, marketing and sales.

Both Hoover and Harding testified that Lordon would receive stock in consideration for money which it advanced and the only dispute between the parties concerned the terms of the stock purchase agreement. Both testified that this agreement was to be reduced to writing sometime in the future. When Lordon tendered the written agreement, embodying the terms and provisions as stated by Harding, Hoover refused to sign it and contended that such did not contain the terms agreed upon. Thereafter, Lordon demanded that the money previously advanced be repaid and Hoover refused. The refusal precipitated the filing of this suit which Hoover countered with the contention that he had sustained damages because of fraudulent misrepresentations made by Lordon concerning the division of the shares of stock of the corporation.

The court submitted special issue number six to the jury which read:

Do you find from a preponderance of the evidence that Lordon represented to Acoustical that Lordon agreed to take ownership of sixty percent of the stock of Acoustical in return for furnishing sufficient sums of money as needed to Acoustical for the payment of Acoustical’s operating expense?

To which the jury answered, “We do.” In answer to ancillary issues, the jury found that the representation was material; that the same was false; that Lordon knew the representation was false; that Acoustical did not know such representation was false; that the representation was made with intent to induce Acoustical to accept the money paid by Lordon; that Acoustical relied upon such representation when it accepted the money from Lordon; that Acoustical relied upon such representation to its prejudice; that Acoustical suffered damages as a result of such representation; and that such damages were in the amount of $563.03 actual and $5,000 exemplary damages. These answers of the jury were disregarded by the trial court in rendering judgment in favor of Lordon.

Texas Rules of Civil Procedures, rule 301 is express in its mandate that the judgment of the court shall conform to the pleadings, the nature of the case proved and the verdict. This rule also authorizes the rendition of judgment non obstante ve-redicto if a directed verdict would have been proper and also provides that the court may upon motion and notice, disregard any special issue finding that has no support in the evidence. Only when the issue is material must the judgment conform to the findings. Thus, a trial court may ignore the answers to immaterial issues and render a judgment based upon the remaining issues. Massie v. Hutcheson, 270 S.W. 544 (Tex.Comm’n App.1925, jdgmt adopted); T. A. Manning & Sons, Inc. v. Ken-Tex Oil Corp., 418 S.W.2d 324, 325 (Tex.Civ.App.—Austin 1967, writ ref’d n. r. e.), and Teas v. Republic National Bank, 460 S.W.2d 233, 240 (Tex.Civ.App.—Dallas 1970, writ ref’d n. r. e.). A review of this entire record convinces us that appellant Acoustical has completely failed to present any evidence of actionable fraud in support of its defense to appellee’s cause of action. A careful analysis of Hoover’s testimony makes it apparent that what appellant asserts as constituting fraud on the part of Lordon is nothing more than a promise that in the future a written agreement would be entered into between Hoover and Lordon concerning stock ownership in Acoustical. It is also evident that the terms of such future agreement were disputed. The jury, in answer to special issue number six, resolved the question of the provisions of the future contract in favor of Hoover. This finding, however, does not amount to a finding of actionable fraud on the part of Lordon. If anything, it constitutes the basis of an action for the breach of contract.

All of the representations alleged by Hoover to constitute fraud concern future events or future promises to perform an event, in this case, to sign a contract. In order for a promise to do something in the future to constitute actionable fraud, it must have been made by the party knowing it was false and with no intention at the time the promise was made to carry out such representation. Stegall v. Lytle, 360 S.W.2d 898, 899 (Tex.Civ.App.—San Antonio 1962, no writ); Underwood v. Williams, 488 S.W.2d 515, 518 (Tex.Civ.App.—Port Worth 1972, no writ); Precision Motors v. Cornish, 413 S.W.2d 752, 756 (Tex.Civ.App.—Dallas 1967, writ ref’d n. r. e.); Morgan v. Box, 449 S.W.2d 499, 504 (Tex.Civ.App.—Dallas 1969, no writ). Mere failure to perform a promise to do something in the future does not establish that a party had no intention to perform at the time the promise was made. Texas Employers’ Insurance Ass’n v. West, 320 S.W.2d 55, 58 (Tex.Civ.App.—Houston 1959, no writ); Turner v. Biscoe, 141 Tex. 197, 171 S.W.2d 118, 119 (1943); Medina v. Sherrod, 391 S.W.2d 66, 69 (Tex.Civ.App.—San Antonio 1965, no writ). The burden of proof was upon Hoover to produce evidence that Lor-don did not intend, at the time the representation was made, to perform the promise to produce a contract in the future which would contain the terms alleged by Hoover. The record demonstrates that Hoover has failed entirely to meet this burden.

What has been said concerning appellant’s defense of fraud applies with. equal force to its contention of equitable estoppel. As a general rule, estoppel cannot be based upon promises to do something in the future, but such promises, if binding at all, must be enforced in an action for breach of contract. Reclamation Co. v. Western Brokerage & Supply Co., 57 S.W.2d 274, 277 (Tex.Civ.App.—Eastland 1932), affirmed, 127 Tex. 386, 93 S.W.2d 393 (1936); 22 Tex.Jur.2d Estoppel §§ 8 and 9 (1961).

Since we hold that appellant’s defenses of fraud and equitable estoppel have not been established, as a matter of law, and that the trial court was justified in disregarding the jury’s answers to the various issues concerning fraud, we turn now to appellee Lordon’s cause of action for money had and received. Although an action for money had and received is an action at common law, it is equitable in its nature. Aetna Casualty & Surety Co. v. Corpus Christi National Bank, 186 S.W.2d 840, 842 (Tex.Civ.App.—San Antonio 1944, writ ref’d w. o. m.). In an action for money had and received, the plaintiff need only show that the defendant holds money which in equity and good conscience belongs to plaintiff and should be returned to him. Staats v. Miller, 150 Tex. 581, 243 S.W.2d 686, 687 (1951). In Staats, the supreme court explained that an action for money had and received is not to be denied or restricted by technicalities and formalities because such an action looks to the abstract justice of the case. It simply inquires whether defendant holds money belonging to the plaintiff. Furthermore, an equitable cause of action for money had and received cannot be denied merely because plaintiff may have other remedies to recover its loss. First National Bank v. Farmers & Merchants State Bank, 417 S.W.2d 317, 331 (Tex.Civ.App.—Tyler 1967, writ ref’d n. r. e.).

It is without dispute in this record that Lordon advanced Hoover $20,500 upon which Lordon never received anything of value. It is also uncontested that these funds were not intended as a gift but were part of a possible future agreement concerning the stock ownership in appellant Acoustical. Since the parties were not in agreement concerning the terms of the future agreement and since the same has not materialized, it follows that the equities of the case require the return of Lordon’s money by Acoustical.

Acoustical contends that Lordon failed to establish an element of his action for money had and received by failing to secure a jury finding that he had “clean hands” when he sought equity from the trial court. We cannot agree with this contention. Since the defenses of fraud and equitable estoppel, as previously demonstrated, are not available to appellant, there is nothing in the record to support the contention of “unclean hands.” It was, therefore, unnecessary to submit such an issue to the jury. The record is without dispute that the money being sought by Lordon belongs to Lordon and is' being withheld from him by Acoustical. Hoover testified that the only reason that he had not returned the $20,500 to Lordon was because he did not have the money. Equity cannot allow appellant to retain the $20,500 which it admits belongs to Lordon.

For the reasons stated, the trial court correctly disregarded the jury’s verdict and rendered judgment for Lordon. Appellant’s point of error is overruled and the judgment of the trial court is affirmed.


author: HALL, Justice.

text:
    Mary Katherine LAWSON et vir, Appellants, v. ESTATE of William T. McDONALD, Deceased, et al., Appellees.
    No. 5351.
    Court of Civil Appeals of Texas, Waco.
    May 22, 1975.
    Rehearing Denied June 19, 1975.

      Wiley, Plunkett, Gibson & Allen, Lewin Plunkett, San Antonio, for appellants.
    Huson, Clark, Thornton & Summers, Robert B. Summers, San Antonio, for appellee Estate of William T. McDonald.
    Les King, Asst. Atty. Gen., Austin, for appellee State of Texas.
   HALL, Justice.

On July 16, 1971, a 1970 Ford pickup truck driven by Mrs. Mary Katherine Lawson and a 1968 Toyota passenger car driven by William T. McDonald collided in the intersection of Farm Road 1604 and Farm Road 1535, in Bexar County. Mr. McDonald was killed in the collision. Mrs. Lawson suffered serious bodily injuries. She and Mr. Lawson brought this suit to recover their damages from the Estate of William T. McDonald. The State of Texas was subsequently impleaded as a defendant. The pleadings of the parties raise these theories as to the causes of the collision: (1) Negligent acts committed by McDonald; (2) negligent acts committed by Mrs. Lawson; (3) the removal of a stop sign at the intersection by unknown persons prior to the collision; and (4) the State’s negligent maintenance of the sign, permitting its easy removal by vandals.

Trial was to a jury. At the close of the proof, the court granted the State’s motion for an instructed verdict. Answering special issues numbered as follows on the remaining questions in the case, the jury (1) found that neither Mrs. Lawson nor Mr. McDonald failed to yield the right-of-way; (4) failed to find that Mr. McDonald was driving at a negligent speed; (6), (7) found that Mr. McDonald failed to keep a proper lookout, and that this failure was a proximate cause of the collision; (8), (9) found that Mr. McDonald failed to make prudent application of his brakes, and that this failure was a proximate cause of the collision; (10) failed to find that Mrs. Lawson was driving at a negligent speed; (12), (13) found that Mrs. Lawson failed to keep a proper lookout, and that this failure was a proximate cause of the collision; (14), (15) found that Mrs. Lawson failed to make prudent application of her brakes, and that this failure was a proximate cause of the collision; and found that the plaintiffs suffered damages totaling $69,925.00. A take-nothing judgment against the plaintiffs was rendered upon the verdict and upon the court’s ruling on the State’s motion for instructed verdict. We affirm.

The plaintiffs assert that there is no evidence to support the negligence and proximate cause findings against them relating to lookout and brakes, or, alternatively, that these findings are against the great weight and preponderance of the evidence; and that, as a matter of law, neither act of negligence found against Mrs. Lawson could have been a proximate cause of the collision.

The proper testing of a “no evidence” complaint requires the reviewing court to view and consider the evidence in the ease, and every reasonable deduction that may be based thereon, in a light most favorable to the questioned finding. Douglass v. Panama, Inc. (Tex.Sup., 1974), 504 S.W.2d 776, 777.

Mrs. Lawson was the sole survivor of the collision. She testified that she has no memory of the accident. There is no other known eyewitness. For this reason, both parties relied heavily upon the testimony of accident-reconstruction experts.

The collision occurred at approximately 8:00 A.M. The weather was clear and the pavement was dry. Immediately prior to the collision, Mrs. Lawson was traveling south on Farm Road 1535. The speed limit for southbound traffic approaching the intersection was 70 miles per hour. North of the intersection there was one lane for southbound traffic and one lane for northbound traffic on FR 1535. South of the intersection, FR 1535 provided two lanes for southbound traffic and two lanes for northbound traffic. Just south of the intersection, the speed limit for southbound traffic reduced to 55 miles per hour.

Mr. McDonald was traveling west on Farm Road 1604 when the collision occurred. The speed limit for westbound traffic approaching the intersection was 40 miles per hour. On each side of the intersection, FR 1604 provided one lane for westbound traffic and one lane for eastbound traffic. Islands beginning near the east and west edges of the intersection, and extending 150 feet therefrom, divided the traffic lanes in FR 1604 as they approached the intersection. Triangular-shaped islands at the edge of the intersection created right-turn lanes for drivers approaching the intersection on FR 1604 from either direction who desired to turn right onto FR 1535.

On the day in question, Mrs. Lawson faced a highway sign located 800 feet from the intersection which read “JCT 1604”; and a sign reading “speed zone ahead,” 150 feet from the intersection. Mr. McDonald faced the following road signs as he approached the intersection: “speed limit 40,” locatéd 1,250 feet from the intersection; “highway intersection 1000 feet,” located 1,000 feet from the intersection; “stop ahead,” 700 feet from the intersection; and “JCT 1535,” 500 feet from the intersection. Ordinarily, a stop sign located on the triangular right-turn island on the east side of the intersection would have faced Mr. McDonald, commanding him to stop before entering; however, this stop sign was removed by vandals sometime after 3:00 P.M. the day before the day in question, and it was not in place at the time of the collision.

Mrs. Lawson had traveled the intersection every workday for 2½ years prior to the day in question. She was on her way to work when the accident happened. She testified that she was familiar with all the signs controlling traffic approaching the intersection on either highway; that she relied upon the fact that a stop sign faced traffic on FR 1604; that she never expected anyone to enter the intersection on FR 1604 without first stopping; that she intended to go straight through the intersection; that she knew the speed limit just south of the intersection was 55 miles per hour; and that her speed at the time of the collision “would have been around 55 miles per hour.”

Mr. McDonald was not familiar with the intersection.

The point of impact was in the northwest quadrant of the intersection. It was located 31 feet from the east line of the intersection and 10 feet from the north line. Both vehicles were traveling straight-ahead at the time of collision. The left half of the front of the pickup struck the right side of the Toyota at its right front wheel. Neither driver attempted to brake or turn prior to impact.

John Bentley, an accident-reconstruction expert, testified that at the time of impact the pickup was traveling 55 miles per hour and the Toyota was traveling 37 miles per hour; that the drivers had full view of each other when the pickup was 300 feet from the point of collision and the Toyota was 202 feet from that point; that they had “clear, unobstructed views” from there to impact; that these distances of initial view placed each vehicle 3.7 seconds from the time of collision; that simple reaction time required to avoid a potential collision, which includes perception time and is the “total time it takes to see, think and commence doing,” is ordinarily three-fourths of a second; that if Mrs. Lawson or Mr. McDonald had begun reaction time as close as two seconds to the time of collision, it could have been avoided; but that this point in time and distance — that is, two seconds in time, which would place the pickup 160 feet from the point of impact and the Toyota 107.9 feet from the point of impact — “was the last point in which the reaction period could commence” in order to avert the collision.

In summary, the evidence reasonably shows that neither driver saw the other before impact; that although two seconds before the accident was the last point in time that either driver could begin perceiving the danger of the threatened collision in time to take evasive action to avoid it, at that point in time each driver had been in full view of the other for at least 1.7 seconds; that during this time, Mrs. Lawson traveled 140 feet in her pickup to within 150 feet of the intersection; that during this same period of time Mr. McDonald traveled 130 feet in the Toyota to within 70 feet of the intersection; that the Toyota was not braked nor turned during this time, but continued straight toward the intersection; and that Mr. McDonald was totally unaware of the pickup.

We believe that the evidence we have recited is sufficient to support determinations by the jury that Mrs. Lawson wholly failed to keep a lookout for other traffic as she approached the intersection; and that if she had been keeping a proper lookout it should have been apparent to her at a point in time when she could have avoided the accident by the application of her brakes or by other proper evasive action — at which point in time the Toyota was only 70 feet from the intersection and was traveling 54 feet per second — that the Toyota probably would not stop at the intersection. Accordingly, we hold that the evidence is legally sufficient to support the questioned findings. Moreover, a review of the entire record convinces us that these findings are not against the great weight and preponderance of the evidence.

The plaintiffs’ argument that neither Mrs. Lawson’s failure to keep a lookout nor her failure to apply brakes could have been a proximate cause of the accident as a matter of law, turns on their contention that she had the right-of-way. They cite a number of cases for the general rule that the failure of a plaintiff who has the right-of-way to keep a lookout or take evasive action cannot legally be counted a proximate cause of a collision if there is no evidence of circumstances which would have reasonably alerted a prudent driver situated as was the plaintiff, in time for proper evasive action by him, that the defendant probably was not going to yield the right-of-way. Samford v. Duff (Tex.Civ.App.—Corpus Christi, 1972, writ ref., n. r. e.), 483 S.W.2d 517, is representative of the cases cited. The applicable rules are set forth in that case (at 483 S.W.2d 522) as follows:

“It is well settled that although a person is not required to anticipate negligent or unlawful conduct on the part of another, he is not entitled to close his eyes to that which is plainly visible to a person of ordinary prudence similarly situated. Lynch v. Ricketts, 158 Tex. 487, 314 S.W.2d 273 (1958); De Winne v. Allen, 154 Tex. 316, 277 S.W.2d 95 (1955). Nevertheless, the mere fact that an automobile driver is favored at an intersection with the right of way resulting from the fact that a green light is facing him does not relieve him from all duty and responsibility and does not exonerate him from blame if there is a vehicle already in the intersection, or if there is approaching him on the intersecting street another vehicle, in view, the driver of which, either because of high speed, failure to slow down, or obvious inattention, is manifestly unable to stop. If those conditions prevail, so long as the driver who is favored by the right of way still has it within his power to stop or otherwise take evasive action, he must do so. He cannot rush out into the path of danger merely because the right of way is with him. Skyline Cab Co. v. Bradley, 325 S.W.2d 176 (Tex.Civ.App.—Houston 1959, writ ref’d n. r. e.); Checker Cab Co. v. Wagner, 199 S.W.2d 791 (Tex.Civ.App.—El Paso 1946, n. w. h.).
“The burden is on the defendant, if he will escape liability for his own negligent conduct or acts, to both plead and prove the defense of contributory negligence. MacDonald v. Skinner, 347 S.W.2d 950 (Tex.Civ.App.—El Paso 1961, writ dism’d); Jaynes v. Lee, 306 S.W.2d 182 (Tex.Civ.App.—Texarkana 1957, n. w. h.). There is no presumption that a person is guilty of contributory negligence simply because an accident occurred. Socony-Vacuum Oil Co. v. Lambert, 180 S.W.2d 456 (Tex.Civ.App.—Amarillo 1944, n. w. h.); Polasek v. Quinius, 438 S.W.2d 828, 838 (Tex.Civ.App.—Austin 1969, writ ref’d n. r. e.). ‘It is held that contributory negligence is not established by evidence which is equally consistent with the exercise of care by plaintiff, or where the inference of due care is just as reasonable as is the inference of the absence thereof.’ Jordan v. City of Lubbock, 88 S.W.2d 560 (Tex.Civ.App.—Amarillo 1935, writ dism’d); Dewhurst v. South Texas Rendering Co., 232 S.W.2d 135 (Tex.Civ.App.—San Antonio 1950, writ ref’d n. r. e.).”

In Samford v. Duff, the plaintiff and defendant collided in a street intersection in the City of Corpus Christi. The plaintiff was on the defendant’s right as they approached the intersection. The jury found that the plaintiff proximately caused the collision by failing to keep a proper lookout. Judgment was rendered on these findings for the defendant. The Court of Civil Appeals sustained the plaintiff’s contention that the findings were not supported by evidence. In the course of its holding, the Court held that the plaintiff had the right-of-way as a matter of law; and, after stating the rules quoted above, said: “There is no evidence as to the distance or time element that [the plaintiff], from his position on Elizabeth Street, could have observed the [defendant’s] car as it approached the intersection. . . . The jury convicted [the plaintiff] of contributory negligence in failing to keep a proper lookout merely because he did not see the [defendant’s] car coming towards him, without any evidence as to the distance when he could have first seen that vehicle as it proceeded [toward the intersection].”

We need not decide the effect of the absence of the stop sign on the question of right-of-way in our case. Mrs. Lawson was on Mr. McDonald’s right as they approached the intersection, and for this reason, if no other, she had the right-of-way under our record under the provisions of Sec. 71(d), Article 6701d, Vernon’s Ann.Tex.Civ.St. However, the critical elements of time and distance of the parties as they approached the intersection, which were lacking in the Samford case, are shown in our case, and are sufficient, as we have said, to have apprised a prudent driver that Mr. McDonald probably would not stop. Samford, therefore, is not controlling. We have given careful study to the other cases relied upon by the plaintiffs, and they, too, lack proof on these elements of time and distance, or simply show that there was no time for prudent evasive action, or are otherwise distinguishable on critical facts.

The plaintiffs’ claim against the State of Texas is based upon provisions in Article 6252-19, Vernon’s Ann.Tex.Civ.St., which, at the time in question, provided as follows:

“Sec. 3. Each unit of government in the state shall be liable for money damages for personal injuries or death . caused from some condition or some use of tangible property, real or personal, under circumstances where such unit of government, if a private person, would be liable to the claimant in accordance with the law of this state. Such liability is subject to the exceptions contained herein
“Sec. 14. The provisions of this Act shall not apply to (12) Any claim arising from the absence, condition, or malfunction of any traffic or road sign, signal, or warning device unless such absence, condition, or malfunction shall not be corrected by the governmental unit responsible within a reasonable time after notice, or any claim arising from the removal or destruction of such signs, signals or devices by third parties except on failure of the unit of government to correct the same within such reasonable time, after actual notice

As we have stated, the stop sign which would have faced Mr. McDonald at the intersection was removed by vandals at some unknown time after 3:00 P.M. on the day before the collision. The evidence shows without contradiction that the State replaced the sign immediately upon notice that it was missing, and the plaintiffs do not contend otherwise. Rather, they base their claim against the State upon the “condition” of the stop sign, under the first part of Sec. 14(12) of Article 6252-19, asserting that the sign was in a “dangerous condition” because it was easily removable, and that the State Highway Department was aware of this condition.

The evidence shows that the road signs controlling the intersection involved, including the stop sign in question, are attached to the single pole upon which each is placed with two U-bolts, and can be easily removed therefrom with a crescent wrench; and that the poles are not directly set in concrete, but are threaded onto a base near the ground, and can also be removed with a wrench. The signs and poles would be more difficult to remove if they were tack-welded. More time would be required to remove the signs if each was placed on two poles instead of one. The signs most often stolen by vandals are stop signs and signs giving road numbers. Sign vandalism at this intersection has been worse than at other intersections on FR 1604; and prior to the date in question vandals had stolen stop signs and other signs from the intersection, although there has been no established frequency of such vandalism. The proper officials of the State Highway Department are aware of all of these facts.

We do not believe the “condition” referred to in the statute relied upon by the plaintiffs was intended to refer to the State’s installation or maintenance of a sign or signal insofar as ease of its removal by thieves is concerned. Rather, the term refers to the maintenance of a sign or signal in a condition sufficient to properly perform the function of traffic control for which it is relied upon by the traveling public. This must be so, inasmuch as there are other provisions in the statute expressly relieving the State from liability for claims growing out of the removal of signs, signals and devices by third parties without a reasonable time for replacement after actual notice to the State of the removal.

The State’s motion for instructed verdict was properly granted.

The plaintiffs bring forward other points and contentions. Some are rendered immaterial in the light of the above holdings. The others are without merit. All are overruled. The crosspoint raised by the representative of McDonald’s Estate is also rendered immaterial.

The judgment is affirmed.