author: TOM G. DAVIS, Judge.

text:
    George Wilbert BROWN, Appellant, v. The STATE of Texas, Appellee.
    No. 58542.
    Court of Criminal Appeals of Texas, Panel 3.
    July 12, 1978.
    Before ROBERTS, ODOM and TOM G. DAVIS, JJ.
   OPINION

TOM G. DAVIS, Judge.

Appeal is taken from an order revoking probation. Appellant was convicted of the primary offense of “attempted delivery of a controlled substance, to wit: morphine” on March 24, 1976. • Punishment was assessed at five years, probated.

On April 1,1977, the court held a hearing on the State’s motion to revoke probation and following the hearing the court entered an order revoking appellant’s probation.

The record is before us without a transcription of the court reporter’s notes. No brief was filed in the trial court in appellant’s behalf as is required by Art. 40.09, Sec. 9, V.A.C.C.P. No question of indigen-cy is raised; however, we have examined the record and find unassigned error which must be considered in the interest of justice under Art. 40.09, Sec. 13, V.A.C.C.P.

The disposition of this case is governed by our decisions in Moore v. State, Tex.Cr.App., 545 S.W.2d 140, and Ex parte Barnes, Tex.Cr.App., 547 S.W.2d 631. There we held that the criminal attempt provisions set forth in V.T.C.A. Penal Code, Sec. 15.01, do not apply to the Controlled Substances Act (Art. 4476-15, V.A.C.S.), which contains no criminal attempt provision.

The charge to which appellant entered a plea of guilty (in the purported primary offense) and received a probated sentence is not an offense and the conviction based thereon is void.

The judgment is reversed, the cause remanded, and the prosecution ordered dismissed.


source: Caselaw Access Project

author: PER CURIAM.

license: Public Domain

text:
    In the Interest of L. G. M., a Child, Appellant.
    No. 16035.
    Court of Civil Appeals of Texas, San Antonio.
    April 19, 1978.
    Charles G. Childress, San Antonio, for appellant.
    James R. Mitcham, Jr., San Antonio, for appellee.
   PER CURIAM.

This is an appeal from an order terminating the parent-child relationship between appellant and her minor daughter.

After appellant properly filed an affidavit of her inability to pay costs, the court reporter prepared the statement of facts in narrative form as authorized by Rule 380, Tex.R.Civ.P. (1977). Appellant has filed a motion that we enter an order directing the court reporter to prepare a statement of facts complying with the provisions of the order of the Texas Supreme Court, made under the provisions of Rule 377(g), Tex.R. Civ.P., dated July 11, 1977, effective January 1,1978, prescribing the form of a statement of facts.

According to the affidavit accompanying appellant’s motion, the lack of conformity of the statement of facts with the provisions of the order of the Supreme Court is the result of the action of the trial judge in instructing the court reporter that the requirements of the Supreme Court’s order under Rule 377 were not applicable to a free statement of facts furnished an appellant under Rule 380.

Rule 377 mentions both statements of facts in question and answer form and those in narrative form. There is nothing in Rule 377 or in the order of the Supreme Court indicating that provisions concerning the form of the statement of facts are inapplicable to narrative statements. We conclude that the requirements as to form are applicable to a narrative statement of facts as well as to a statement in question and answer form.

The statement of facts prepared in this case contains no index as required by paragraph (c) of the Supreme Court’s order. The statement of facts does not indicate which portion of the testimony was given on direct, cross, re-direct or re-cross examination. There is no separate table showing the number of the page at which any exhibit or other document offered in evidence appears, nor the page at which such exhibit was identified, offered, admitted or excluded.

The pages of the statement of facts are not numbered consecutively on the bottom of the page as required by paragraph (d) of the Supreme Court’s order, nor are the pages numbered at all. It is clear that the defects in the statement of facts will hinder this Court in its consideration and determination of the merits of the appeal.

The court reporter for the District Court, 225th Judicial District of Texas, is hereby directed, pursuant to paragraph (g) of the order of the Supreme Court, within 60 days, to amend the statement of facts so that it will comply with the provisions of such order, or, if such be impractical, to prepare a new statement of facts, in narrative form, complying with the provisions of the order of the Supreme Court. Delivery of a copy of this opinion to such reporter shall constitute notice of our order, and the Clerk of this Court shall issue no formal order unless the court reporter refuses to proceed in accordance with this opinion.

Appellant’s brief shall be filed in this Court not later than 30 days after a statement of facts in proper form has been prepared and filed in this Court.


author: MOORE, Justice.

text:
    Jack I. GRONBERG et al., Appellants, v. Philip H. YORK, Appellee.
    No. 1118.
    Court of Civil Appeals of Texas, Tyler.
    May 4, 1978.
    Rehearing Denied June 22, 1978.

      Joe B. Burnett, Arlen D. Bynum, Bradshaw & Bynum, Dallas, for appellants.
    Ron W. Kessler, Feather, Kessler & Douglas, Dallas, for appellee.
   MOORE, Justice.

This is a suit for commissions alleged to be due under an employment contract and for certain benefits alleged to be due under terms of a pension and retirement plan. The suit was instituted by appellee, Philip H. York, against his former employer, Dynamic Component Sales, Inc. (DCS); Jack I. Gronberg, its president, and Harry R. As-chan, Harold S. Hilton and Jack I. Gron-berg, trustees of the Retirement Plan and Trust established by DCS, Inc. Appellee York sought recovery of commissions alleged to have been earned by him prior to termination of his employment. He also sought a recovery of his interest in the pension trust fund which had vested at the time of his termination. York further sought repayment from DCS for the amount of the contributions paid into the retirement fund, alleging that, under the retirement plan trust agreement, the plan was to have been funded solely by contributions from DCS. DCS, together with the other defendants, answered with a general denial. In response to special issues, the jury found that York was entitled to $6,983.67 in unpaid commissions; that DCS agreed with York to make all contributions to the pension plan; that DCS made contributions to the pension plan by deducting from York’s monthly commissions; that as a result York was entitled to damages in the amount of $21,786, the amount he contributed to the fund; that the DCS Retirement Plan and Trust was indebted to York in the sum of $14,808 for his vested interest in the pension fund; that York did not waive his right to complain of the funding of the pension plan with funds withheld from his commissions; and that Jack I. Gronberg was the alter ego of DCS. After appellants’ motion for judgment n. o. v. had been overruled, the trial court entered judgment on the verdict in favor of appel-lee York, from which appellants perfected this appeal.

We affirm in part and reverse and render in part.

The evidence shows that appellee was employed by DCS on August 1, 1967, as a manufacturer’s representative. Appellant DCS, a Texas Corporation, with appellant Jack I. Gronberg as its president, were engaged in the business of representing various manufacturers in the sale of manufactured products on a commission basis. Although no formal contract of employment was made, it was mutually agreed that appellee’s territory was the northern and western sections of the state, including Dallas and Fort Worth. It was also mutually agreed that appellee was to be paid on the basis of 70% of the commissions generated by him in his territory, out of which he was to pay his own expenses. The billing and collecting of all commissions were handled by DCS. After collecting the commissions, DCS issued a check to appellee for his 70% and retained 30% of the commissions for corporate purposes. Other sales representatives employed by DCS in other areas were compensated on the same basis.

In August 1969 DCS adopted a pension and retirement plan. In implementing the plan DCS entered into a trust agreement with Jack I. Gronberg, Harry R. Aschan and appellee Philip H. York, as trustees, who agreed to administer the plan for the benefit of the employees. The employees consisted only of Mr. Gronberg; Harry R. Aschan, a sales representative in the Tulsa, Oklahoma area; a secretary who worked with Mr. Gronberg in the home Office in Houston; and appellee, Philip H. York. Harold Hilton was later employed as a sales representative. The plan and trust indenture recited that the employer, DCS, was to fund the plan by making payments to the trustees for the purchase of life insurance policies on the employees who elected to become members and for deposits of cash to the auxiliary investment account from which certain stipulated amounts were to be paid on retirement. The indenture further provided that no contributions would be required of any member. For reasons hereinafter explained, DCS made no contributions to the trust fund. Instead, with the knowledge of the employees, DCS deducted each month from the commissions due the appellee and the other employees an amount sufficient to properly fund the plan, and paid such amount over to the trust fund. Each month, commencing in August 1969, DCS mailed appellee and the other salesmen a statement along with their monthly checks showing an amount withheld from their commissions which was used for payment to the pension trust fund.

On November 6, 1973, appellee addressed a letter to Gronberg, President of DCS, expressing dissatisfaction with certain changes in his sales territory and stating that he was terminating his employment as of November 30, 1973. In reply, Mr. Gron-berg notified him on November 13, 1973, that his employment was terminated effective November 12, 1973.

After termination appellee made a demand on DCS for a commission on all invoices billed to customers in his territory for a period of ninety days after termination. He also demanded the vested portion of the pension trust fund due him under the terms of the plan. In addition to his having sought his unpaid commissions and his vested portion under the pension plan, appellee in his petition also sought damages in the amount of the contributions he made to the plan which he alleged were wrongfully deducted by DCS from his monthly commissions.

Upon trial, appellants admitted that ap-pellee was entitled to $2,536.05 in unpaid commissions due for the period of November 1 to November 12. Appellants further admitted that he was entitled to the sum of $10,300 as his vested interest in the pension trust fund plus interest in the amount of $515.

Appellants contend by their sixth point that there is no evidence to support the jury finding on Special Issue No. 1 that appellee was entitled to $6,983.67 in unpaid commissions. In their seventh point appellants contend that even if there were some evidence to support the finding, the finding is nevertheless against the great weight and preponderance of the evidence. We find no merit in either contention.

As stated, appellants admitted that appellee was entitled to unpaid commissions from November 1 until November 12, 1973, in the amount of $2,536.05. Under the terms of the working agreement between appellee and DCS which existed prior to November 13,1973, the evidence shows that the parties agreed that, in the event of termination, appellee was to be paid for all commissions thereafter booked in his territory for a period of 90 days. In the termination letter addressed to appellee on November 13, 1973, Mr. Gronberg stated: “You will be credited for invoices for 30 days past 12 November 1973 and payment on these will be made to you six months after 12 November 1973 . . . .” The evidence shows that DCS supplied appellee with a copy of the invoices for the 30-day period as promised and that his commissions for the thirty days after November 12 amounted to $4,483.67. It thus becomes apparent that the jury’s verdict finding ap-pellee was entitled to $6,983.67 was the result of the jury’s having combined the commissions due for the 30-day period with the undisputed sum of $2,536.05 due for the period of November 1 to November 12, with a miscalculation of $36.05. Although appel-lee offered evidence and contended he was entitled to commissions for ninety days after termination, the jury awarded him commissions for only a thirty-day period, about which he makes no complaint. We believe there is ample evidence to support the finding and have further concluded that such finding is not against the overwhelming weight and preponderance of the evidence. Accordingly, appellants’ sixth and seventh points are overruled.

By their twelfth point appellants contend that the trial court erred in overruling their motion for new trial because there is no evidence or insufficient evidence to support the jury’s finding to Special Issue No. 6A in which the jury found that the sum of $14,-808 would fairly and reasonably compensate appellee for his vested portion of the pension fund.

Appellants admitted both in their pleadings and on trial that, under the plan and trust agreement, appellee was entitled to a vested interest in the pension fund. The only question before the jury was the amount. The evidence shows without dispute that shortly after appellee’s termination the trustees delivered appellee the insurance policy held by the trust. It is also undisputed that the policy had a cash value of $4,544.77. Appellee admitted that he had received the policy and was not seeking a recovery of this portion of his vested interest. During the trial appellants admitted that his vested interest exclusive of the cash value of the policy amounted to the sum of $10,300 plus $515 accrued interest. The figure relied on by appellants was the vested interest set forth in the 1975 Annual Plan Review prepared by the fund’s professional advisors. According to witness H. L. Wendorf, an expert in the field of pensions trusts called by appellee, appellee’s vested interest at the time of his termination amounted to the sum of $12,651.43 after excluding the $4,544.77 cash value of the insurance policy which had previously been delivered to appellee. He further testified that the interest from the date of termination on such amount was $2,156.68 and ap-pellee was therefore entitled to the sum of $14,808.11. The jury found that appellee’s vested portion of the trust fund, together with interest, was $14,808. Thus, it is apparent that the jury chose to follow the testimony of appellee’s expert witness as to the present value of the vested portion of the fund rather than the evidence of the lesser value offered by appellants. Where the evidence is conflicting, as here, it is within the jury’s province to weigh all of the evidence and to decide what credence should be given to the testimony of each witness. Muro v. Houston Fire and Casualty Insurance Company, 329 S.W.2d 326 (Tex.Civ.App. — San Antonio 1959, writ ref’d n. r. e.); Martin v. Johnson, 365 S.W.2d 429 (Tex.Civ.App. — Eastland 1963, no writ history). Viewing the evidence in a light most favorable to the jury’s finding, we have concluded that there is ample evidence of probative force to support the finding and judgment based thereon. Accordingly, appellants’ twelfth point is overruled.

Under their thirteenth point appellants seek a reversal on the ground that the court erred in admitting into evidence, over their objection, the testimony of appellee showing that for two years the percentage of the business done by him in his territory was greater than that of all the other business done by DCS combined. Appellants argue that such testimony was immaterial and prejudicial in that it was calculated to cause the jury to sympathize with appellee’s position. We do not agree.

Appellee was permitted to testify that his. percentage of commissions produced for DCS was more than 50% of all the commissions earned by DCS during the years 1970— 1972. In our view this evidence was material for two reasons. First, one of the issues in the court below was whether appellant Gronberg had breached an agreement with appellee whereby appellee would participate in the ownership of the company. Gronberg denied the existence of such agreement. Consequently, appellee’s testimony showing he was responsible for a major portion of the commissions earned by DCS was material in that it lends credence to his position that Mr. Gronberg agreed to allow him to participate in the ownership of the corporation due to his outstanding ability. Further, the evidence was material to rebut appellants’ testimony implying that appellee had not properly performed his work due to a drinking problem and a reluctance to travel. We think the testimony was clearly relevant, material and therefore admissible since it tended to rebut testimony relating to material facts relied on by appellants. Lone Star Gas Co. v. State, 137 Tex. 279, 153 S.W.2d 681 (1941); Martin v. Johnson, supra. Appellants’ thirteenth point is overruled.

In points 8 through 11 appellants, DCS and Jack I. Gronberg, contend that there is no evidence to support the jury’s findings on Special Issues Nos. 3 and 4, or in the alternative that such findings are against the overwhelming weight and preponderance of the evidence. Further, they contend that such findings will not support a judgment in favor of the appellee based on the theory of conversion.

In response to Special Issues Nos. 3 and 4, the jury found that DCS made contributions to the pension plan for the benefit of York by making deductions from his portion of the commissions and that the sum of $21,786 would reasonably compensate him for the deductions made therefrom by DCS. Appellee’s theory of recovery on this phase of the case, as alleged in his petition, was that DCS had converted the funds to its own use and benefit by paying the same into the pension trust fund. He alleged that DCS was therefore liable to him for conversion of the funds. Contrary to appellants’ contention, the undisputed proof shows that DCS withheld approximately $380 per month out of appellee’s monthly commissions for a period of over four years and paid the same into the pension trust fund. Even so, we do not believe the proof was sufficient to establish a cause of action for conversion.

In this instance, the chattel alleged to have been converted is money. It is the rule in this state that money is subject to conversion only when it can be described or identified as a specific chattel. Story v. Palmer, 284 S.W. 331 (Tex.Civ.App. — El Paso 1926, no writ history); Hull v. Freedman, 383 S.W.2d 236 (Tex.Civ.App. — Fort Worth 1964, writ ref’d n. r. e.).

In 14 Tex.Jur.2d Conversion sec. 11, the rule is stated as follows:

“Money may be the subject of conversion if it can be described or identified as a specific chattel; that is, there may be a conversion where there is an obligation to return specific money, but not where an indebtedness may be discharged by the payment of money generally.”

Obviously, appellee does not seek the return of specific money but is only seeking repayment of money generally which he alleged was wrongfully withheld from his commissions. Consequently, the judgment on this phase of the case cannot be sustained on the theory of conversion.

Further, we are of the opinion that conversion was not established for yet another reason. Appellee does not dispute the fact that he knew from the date the pension plan was adopted that funds were withheld from his monthly commission each month for a period of over four years. It is undisputed that DCS never elected to fund the plan with corporate funds. According to the testimony of Harry Aschan, one of the trustees, the reason why DCS never commenced funding the plan was because it would have been impossible for DCS to have made the necessary contributions to the fund out of the thirty percent income it received from the monthly commissions. The evidence shows that after the plan had been in operation for approximately one year it was discovered that, because of a mistake on the part of the actuary, the employees had not made sufficient contributions to properly fund the plan during the first year. Upon being notified that his share of the deficit was approximately $800, appellee directed DCS to take such amount from his next monthly commission check and pay it over to the fund. Appellee admitted' that he knew the monthly payroll deductions were turned over to the fund and testified that he understood that the amount of his contributions thereto amounted to deferred income and that he knew he was not paying any income tax thereon. Although this procedure was followed for more than four years prior to the date of his termination, he admitted that he never registered any complaint until he filed the present suit in November 1975. His only explanation as to why he never made any complaint was that he never fully understood the terms of the pension plan indenture until after his termination when his accountant advised him that the pension plan indenture required DCS to fund the plan wholly out of corporate funds. According to the testimony of experts in the field of funding pension plans, there is nothing wrong with the employees funding the plan out of their earnings even though the plan may stipulate that it is to be funded by the employer, so long as each employee consents that his funds be used for that purpose.

Where a person has knowledge that funds are being deducted from his weekly earnings for the purpose of establishing a pension fund for his benefit and he does not object or forbid the same to be done, he certainly acquiesces in such taking and cannot base an action of conversion on such circumstances. Gulf, C. & S. F. R. Co. v. Pratt, 183 S.W. 103 (Tex.Civ.App. — Beaumont 1916, writ ref’d). In our view the evidence in the instant case conclusively establishes that the appellee knew his funds were being withheld and paid into the pension trust fund for his benefit. Moreover, he asserted a claim for the benefits due under the plan and has been awarded recovery for such amount. Thus, we think appel-lee must be held to have consented to the action of DCS in withholding such amount. Consequently, for this additional reason we hold that appellee failed to establish a cause of action for conversion.

Under the fourth and fifth points appellants, DCS and Jack Gronberg, challenge the jury’s finding to Special Issue No. 2, wherein the jury found that DCS agreed with appellee York to make all contributions to the pension plan from corporate funds. Appellants contend that there is no evidence to support such finding, or in the alternative that the finding and the judgment based thereon are against the overwhelming weight and preponderance of the evidence.

While the jury found that DCS agreed with York to fund the plan out of corporate funds, we fail to find any evidence to support such finding. On this appeal, appellee seems to argue that the pension plan indenture constituted an agreement between him and DCS that DCS would fund the plan solely out of corporate funds. Based on this premise he argues that since the evidence conclusively shows that DCS not only failed to fund the plan out of corporate funds but also used his funds to implement the plan, he suffered damages in the amount of $21,786, the amount withheld by DCS. Therefore he maintains that the judgment may be sustained on the theory of breach of contract. We cannot agree with this proposition.

The pension plan indenture was between DCS and the trustees of the plan. Appellee was not a party to the agreement. Under Article V, sec. 5.01, the plan provides as follows:

“Employer shall make due and timely payments to the Trustees for the purchase of ordinary life contracts and for deposits in the auxiliary investment account of such amounts as may be necessary from time to time, according to the certification of the Trustees, to provide the following benefits to members or their beneficiaries: (then follows the enumerated benefits)”

Sec. 5.02 provides:

“Employee contributions: No contributions shall be required of any member.”

In Article XI, sec. 11.01, it is provided:

“Declaration of interest: It is the expectation of employer that it will continue this plan and payment of its contributions hereunder indefinitely, but continuance of the plan is not assumed as a contractual obligation of the employer. The plan is entirely voluntary and the right is reserved by the employer at any time to suspend or discontinue its contributions hereunder and/or to terminate the plan.”

Under Article XII, sec. 12.01, the plan provides:

“Not contract of employment: The adoption and maintenance of this plan shall not be deemed to constitute a contract between employer and any employee or to be considered for inducement or condition of the employment of any person.”

The plan adopted in the instant case clearly shows that DCS was to pay the entire cost of the plan but that such payments were to be made on a voluntary basis. DCS was authorized to suspend the payment at any time it saw fit. The plan further shows that no contractual relationship was intended or created between DCS and its employees. Thus, the obligation to fund the plan on the part of DCS was purely a gratuitous undertaking.

The nature of the rights conferred upon an employee by a private pension or retirement fund depends on the provisions of the particular plan. Many plans embrace declarations that the employee shall acquire no enforceable rights under the plan which, at least in the case of noncontributory plans, the courts have frequently respected. 60 Am.Jur.2d Pension & Retirement Funds sec. 74; Hughes v. Encyclopedia Britannica, Inc., 1 Ill.App.2d 514, 117 N.E.2d 880, 42 A.L.R.2d 456 (1954).

The facts of this case do not fall within the category of those situations in which the employee is attempting to collect pension benefits after he has served the required number of years so as to become eligible for a pension under the plan adopted by his employer. In effect, by contending that the indenture constitutes a contract between him and his employer and that the failure to fund the plan solely out of corporate funds constitutes a breach of contract, appellee seeks to impose a duty on his employer to abide by the provisions of the plan as to method of funding.

Because the plan by its terms expressly negatives a contractual obligation on the part of the employer to continue and maintain the plan and further states that the funding of the plan is entirely voluntary, we conclude that the pension plan indenture does not constitute a contractual agreement whose provisions as to funding can be enforced by an employee. Hughes v. Encyclopedia Britannica, supra. See also Webster v. Southwestern Bell Tel. Co., 153 S.W.2d 498 (Tex.Civ.App. — El Paso 1941, writ ref’d); Shear v. Harrington, 266 S.W. 554 (Tex.Civ.App. — Waco 1924, no writ history). It therefore follows that the judgment cannot be sustained on the theory that the failure by DCS to fund the plan solely out of corporate funds amounted to a breach of contract.

We do not reach appellants’ fifth point challenging the jury’s answer on the ground that it is against the overwhelming weight and preponderance of the evidence. However, if such point were reached, we would overrule it.

Accordingly, that portion of the judgment awarding appellee the sum of $21,786 is reversed and judgment is hereby rendered that appellee take nothing on his claim against DCS and Jack I. Gronberg for the recovery of his contributions to the pension plan. In all other respects the judgment of the trial court is affirmed.

Affirmed in part and reversed and rendered in part.

ON MOTION FOR REHEARING

On Motion for Rehearing appellee expresses concern because we addressed ourselves to the issue of conversion. He asserts that since appellants did not specifically raise the issue in their brief, we failed to follow the rules of appellate procedure by deciding an issue not raised in the brief.

Our reason for disposing of the issue of conversion was due to the fact that the only theory upon which appellee sought a recovery in his pleadings was that DCS had wrongfully converted the funds withheld from appellee’s monthly commission check. Furthermore, the jury found that DCS agreed with York to make all contributions to the fund and also that DCS made the contributions with funds deducted from his commissions. Thus, based on the pleadings and the foregoing findings, we concluded that the issue of wrongful conversion was raised. When appellants in their brief challenged the foregoing findings on the ground that the findings were not supported by the evidence, we concluded, and still believe, that the issue of conversion became a viable issue calling for some disposition even though appellants did not specifically discuss any of the elements of conversion in their brief.

Turning to the contract feature of the case, appellee points out that the breach of contract theory, although not specifically pled, was tried and submitted to the jury by consent. Further he points out that appellants admitted in their brief that “the ultimate issue as to the contributions to the pension plan is whether or not DCS breached any agreement with plaintiff as to funding of the plan and the manner in which it was funded.” We recognize, as we did in our original opinion, that the breach of contract theory was tried by consent. However, as we attempted to point out in our original opinion, there is no evidence that DCS ever made any agreement with York individually, promising him that it would make all contributions to the pension plan out of corporate funds. York signed the pension plan agreement in his capacity as a trustee. Thus, the pension plan agreement cannot be construed as a private agreement between York and DCS. On Motion for Rehearing appellee contends that he was a third party beneficiary under the pension plan agreement. Based on such premise, he argues that since DCS contracted with the trustees to fund the plan and failed to do so, it breached its contract and therefore he had a right, as third-party beneficiary, to enforce the funding provisions of the plan and recover damages in the amount DCS deducted from his monthly commissions and paid into the trust fund. We are not in accord with this proposition. Had the pension plan agreement not been a gratuitous undertaking on the part of DCS, appellee might conceivably have been able as third-party beneficiary to sue and recover on the theory of breach of contract. However, since the agreement to fund the plan was purely voluntary, no duty on the part of DCS arose, and as a result appellee acquired no right to assert a cause of action for the breach thereof. Avinger v. Campbell, 499 S.W.2d 698, 704 (Tex.Civ.App.— Dallas 1973) writ ref’d n. r. e., 505 S.W.2d 788 (Tex.1974). The fact that the jury found that appellee did not waive his right to complain of the funding of the plan with funds withheld from his commissions cannot serve to create a cause of action for breach of a gratuitous contract where no such cause of action existed in the first instance. The motion is overruled.


author: DIES, Chief Justice. KEITH, Justice,

text:
    Melvin LINTZ, Appellant, v. Eastman DILLON et al., Appellees.
    No. 8084.
    Court of Civil Appeals of Texas, Beaumont.
    May 18, 1978.
    Rehearing Denied June 8, 1978.

      Goodman L. Caplan, Arthur L. Forbes, Houston, for appellant.
    Fred J.. Knapp, Houston, for appellees.
   DIES, Chief Justice.

Melvin Lintz sued Eastman Dillon, Union Securities & Co., and Sam Dodd for recission of a contract for the sale of Omnitec securities by Eastman Dillon to Lintz. Plaintiff sought recission on the basis of Tex.Rev.Civ.Stat.Ann. art. 581-33 A(l) for failure to register the securities, or on the basis of art. 581-33 A(2) because of untrue statements or omissions of material fact made at the time of the sale. Trial was to the court without a jury.

The court made findings of fact and conclusions of law that: (1) any cause of action based on art. 581-33 A(l) for failure to register the securities was barred by the three-year statute of limitations in art. 581— 33 C; (2) neither Eastman Dillon nor Sam Dodd violated art. 581-33 A(2) because neither made an untrue statement or omission of material fact to Lintz; (3) if Dodd did make such false statements or omissions, this action was still barred by art. 581 — 33 C because Lintz did not sustain his burden of proving that prior to March 30, 1969, he could not have discovered such faults through the exercise of ordinary care; (4) if Eastman Dillon made false statements or omissions of material fact, this action was also barred by art. 581-33 C because Lintz did not sustain his burden of proving that prior to February 28, 1969, he could not have discovered such faults through the exercise of ordinary care; (5) the transaction was exempt from registration under the Securities Act of 1933, and; (6) Lintz was barred from recovery by the doctrine of laches. The trial court rendered judgment for the defendants, and Lintz instituted this appeal.

On February 14, 1969, Dodd, a stockbroker employed by Eastman Dillon, telephoned Lintz and recommended Omnitec securities as an attractive investment. This recommendation was based solely on a memorandum from Eastman Dillon’s research department. Dodd had not seen a financial statement, balance sheet, or earnings record, nor was he aware of Omnitec’s registration status when he recommended the purchase. Based on Dodd’s recommendation, Lintz bought 1000 shares of Omnitec stock on a “when, as and if issued” basis, 500 shares at $12¼ per share, and 500 shares at $13x/4 per share. This stock was sold to plaintiff by Eastman Dillon on its own account. The sale was confirmed by telephone on February 14, 1969, and by letter one or two business days later.

On March 3, 1969, the Omnitec stock was actually issued. The stock was not registered under the Texas Securities Act, nor under the federal Securities Act of 1933. Plaintiff paid defendant for the stock on March 28, 1969. Plaintiff commenced this action against Eastman Dillon on February 28,1972, and joined Dodd as a defendant on March 30, 1972.

Appellee’s first reply point argues that appellant’s Points of Error are multifarious and in violation of Tex.R.Civ.P. 418. We agree with this contention. Appellant has four Points of Error, referring to a total of sixty-nine Specifications of Error contained in an appendix to the brief. These Specifications of Error are primarily “no evidence” and “insufficient evidence” points, and constitute appellant’s actual substantive points of error. Appellant’s Points of Error in the body of his brief are nothing more than conclusory statements, and reveal nothing by themselves about the basis of appellant’s complaint. Point of Error No. 4 alone contains thirty-two “no evidence” points and twenty-four “insufficient evidence” points.

Although we strongly disapprove of this manner of briefing, we recognize that our briefing rules are to be liberally construed so as to allow litigants to concentrate their energies on the substance and not the technicalities of an appeal. We have been instructed by our Supreme Court to “pass on both the sufficiency and the merits of the ‘point’ in the light of the statement and argument thereunder.” Fambrough v. Wagley, 140 Tex. 577, 169 S.W.2d 478, 482 (1943); O’Neil v. Mack Trucks, Inc., 542 S.W.2d 112 (Tex.1976); Eoff v. Muskiet, 561 S.W.2d 542 (Tex.Civ. App — Beaumont 1977, writ ref. n. r. e.). We will apply this standard of review in our examination of appellant’s brief.

Appellant argues in his first Specification of Error that the trial court erred in finding that appellant’s claim under Tex. Rev.Civ.Stat.Ann. art. 581-33 A(l) for failure to register the securities was barred by the three-year statute of limitations, because the undisputed evidence establishes that the action was filed within three years after the “contract of sale.” We agree with this contention, and accordingly reverse and render judgment for appellant.

The trial court found that the statute of limitations began to run on February 14, 1969, when appellant instructed Dodd to purchase 1000 shares of Omnitec on a “when, as and if issued” basis. Under this interpretation, the statute of limitations for failure to register the securities began to run more than two weeks before the securities were even in existence. This interpretation would conceivably allow the limitation period to run in its entirety before the obligation to register the securities ever arose.

We cannot accept such an analysis of the statute of limitations in art. 581-33 C, particularly in light of our Supreme Court’s directive that since art. 581-33 “is remedial in nature it should be given the widest possible scope.” Flowers v. Dempsey-Tegeler & Co., 472 S.W.2d 112, 115 (Tex.1971). In Flowers, the question was whether or not the word “person” used in art. 581-33 included corporations. The Court held that it did, and noted that any other construction “would defeat the intention of the Legislature by permitting corporate securities dealers to sell unregistered securities to the public free of any fear from civil suits.” (at 115) This same rationale is applicable in the present case, and leads to the conclusion that the statute of limitations for failure to register securities should not begin to run before the securities are in existence.

We must also point out that art. 581-33 was largely revised in 1977. Tex.Rev.Civ. Stat.Ann. art. 581-33 and Comment (Supp. 1978). With regard to the three-year statute of limitations applicable to art. 581-33 A(l) actions, the phrase “contract of sale” was changed to “sale.” This change in language is not discussed in the Comment as being a substantive change in when the limitation period begins to run, and we believe that it is merely a clarifying change in language.

It is a well-established policy in Texas that a statute of limitations does not begin to run until a cause of action has accrued. Atkins v. Crosland, 417 S.W.2d 150 (Tex.1967); Cox v. Clay, 237 S.W.2d 798 (Tex.Civ.App. — Amarillo 1950, writ ref’d n. r. e.); Puretex Lemon Juice, Inc. v. S. Biekes & Sons of Dallas, Inc., 351 S.W.2d 119 (Tex.Civ.App. — San Antonio 1961, writ ref’d n. r. e.); Lowery v. Juvenal, 559 S.W.2d 119 (Tex.Civ.App. — Amarillo 1977, writ ref’d n. r. e.). Where there is some condition precedent to the right of action, the cause of action does not accrue, nor the limitation period begin to run, until that condition is performed. 37 Tex.Jur.2d Limitation of Actions § 57 at 178 (1962); Pyramid Life Ins. Co. v. Ellis County Drainage Dist. No. 1, 136 S.W.2d 267 (Tex.Civ.App.— Waco 1940, writ ref’d); Dunn v. Reliance Life & Accident Ins. Co., 405 S.W.2d 389 (Tex.Civ.App. — Corpus Christi 1966, writ ref’d n. r. e.); Washington v. Martin, 503 S.W.2d 330 (Tex.Civ.App. — Amarillo 1973, no writ). In the present case, the enforcement of any rights embodied in the February 14, 1969, agreement was conditioned upon the securities first being issued. On March 3, 1969, when the securities were issued, the parties’ rights became enforceable, and their cause of action accrued. It was on that day that the statute of limitations began to run.

The trial court additionally found that appellant’s action was barred by application of the doctrine of laches. We disagree with this finding. Our Supreme Court has stated in Barfield v. Howard M. Smith Company of Amarillo, 426 S.W.2d 834, 840 (Tex.1968) that:

“Generally in the absence of some element of estoppel or such extraordinary circumstances as would render inequitable the enforcement of petitioners’ right after a delay, laches will not bar a suit short of the period set forth in the limitation statute.”

The trial court found that Lintz’s failure to make a demand or complaint to Eastman Dillon or Dodd prior to filing this action on February 28, 1972, prejudiced and injured the defendants. No specific finding was made as to how Eastman Dillon and Dodd were injured. Our examination of the record in this case, in keeping with the factual analysis in Barfield, supra, leads us to the conclusion that this is not a situation where the doctrine of laches should be used to reduce the statutory limitation period.

Since the trial court found that the securities were not registered under the Texas Securities Act, and since he did not find that the securities were exempt from registration under the state act, though he did hear testimony on this point, we have no recourse but to reverse and render judgment for the appellant against the appellee, Eastman Dillon. Though this result may seem harsh in the case of an experienced buyer who watched the securities decline in value for nearly three years before filing suit, this outcome is evidently the clear intention of the Legislature under art. 581— 33. Failure to register the securities is actionable per se, without regard to the particular knowledge or expertise of the individual buyer.

Dodd was joined as a defendant more than three years after the cause of action accrued, and the trial court properly found that the action against him for failure to register under art. 581-33 A(l) was barred by art. 581-33 C.

We therefore order that defendant Eastman Dillon pay to plaintiff Melvin Lintz a sum equal to $12,750.00, plus interest at the rate of 6 percent per annum from March 28, 1969, until May 20, 1977, and plus interest from May 20, 1977, at the rate of 9 percent per annum. We further order that plaintiff Melvin Lintz return the 1000 shares of Om-nitec securities to defendant Eastman Dillon. All costs are taxed against the appel-lee.

REVERSED and RENDERED.

KEITH, Justice,

dissenting.

The impact of the majority decision in this case will, in all probability, be minimal; but, since I am of the opinion that it does violence to the jurisprudence of this state, I respectfully dissent.

I first point to the self-evident fact that plaintiff seeks to recover upon a cause of action which did not exist at the common law but is one created solely by statute. Thus, I invoke the rule enunciated in State of California v. Copus, 158 Tex. 196, 309 S.W.2d 227, 231 (1958):

“[WJhere the statute creates a right and also incorporates a limitation upon the time within which the suit is to be brought, the limitation qualifies the right so that it becomes a part of the substantive law rather than procedural, and that unless suit is brought within the time allowed by statute no right of action can be maintained even though the law of the forum provides for a longer period of limitation. Stumberg, Conflict of Laws, 2d Ed. p. 150.”

Accord: Franco v. Allstate Insurance Company, 505 S.W.2d 789, 792 (Tex.1974); Francis v. Herrin Transportation Co., 432 S.W.2d 710 (Tex.1968); Cohen v. C. H. Leavell & Co., Inc., 520 S.W.2d 793, 796 (Tex.Civ.App. —El Paso 1975, no writ). See also 51 Am. Jur.2d, Limitation of Actions § 15, at 600 (1970).

I suggest that the opinion of the majority is in conflict with the holdings in the cases cited immediately above.

I dissent primarily because the majority has mistakenly applied a statute enacted in 1977 to a transaction which occurred in 1969. In so doing, the Court has permitted an “active and sophisticated trader” in the stock market to speculate at the defendants’ risk for more than three years.

As noted in the majority opinion, the parties entered into a contract of sale on February 14, 1969, whereby 1,000 shares of stock of Omnitec Corporation were sold to plaintiff on a “when, as and if issued basis.” This suit was filed on February 28, 1972.

At all times material to this suit (including the transaction between the parties on February 14, 1969, to and including the entry of the judgment in the trial court on May 20, 1977), Tex.Rev.Civ.Stat.Ann. art. 581-33 A(l) (1964), under which plaintiff prosecuted and maintained his suit, had a limitation provision reading:

“C. No person may sue under Subsection A(l) of this Section 33 more than three (3) years after the contract of sale.” (emphasis supplied)

The trial court found as a fact and concluded as a matter of law that this barred plaintiff’s recovery.

The majority has now mistakenly applied the current or 1977 amendment of the blue sky law to this case which originated before it became effective. Effective August 29, 1977, the statute was amended so that Tex. Rev.Civ.Stat.Ann. art. 581-33 H (Supp. 1978) now reads:

“H. Statute of Limitations.
(1) No person may sue under Section 33 A(l) of 33 F so far as it relates to Section 33 A(l):
(a) more than three years after the sale; . . . .” (emphasis supplied)

The legislative change is simple but important. Limitations began to run under the statute governing this suit when the contract of sale was consummated — now the critical date is the sale.

The majority refuses to hold plaintiff to the language of the statute creating his cause of action. He could recover only if he brought his suit within three years “after the contract of sale.” This was a condition precedent to his maintenance of his cause of action. If he sued within the time specified in the statute, he could proceed — otherwise his cause of action no longer existed.

There was a contract of sale entered into between the parties on February 14, 1969, although it was a conditional contract. The condition did not qualify the existence of the contract; rather, it constituted a condition precedent to defendant’s obligation to pay the agreed purchase price therefor. See generally, Hohenberg Bros. Co. v. George E. Gibbons & Co., 537 S.W.2d 1, 3 (Tex.1976). See also Delisle Construction Co. v. Schwarz-Jordan, Inc., 561 S.W.2d 619, 621 (Tex.Civ.App. — Beaumont 1978, application pending), and Modine Manufacturing Co. v. North East Independent School Dist., 503 S.W.2d 833, 842-843 (Tex.Civ.App.— Beaumont 1974, writ ref’d n. r. e.), and authorities therein cited.

The majority permits a sophisticated investor to sit by and watch while a stock gradually dwindles in value until it becomes worthless. He does so realizing that if it should appreciate in value, he can claim the gain; but, if it finally becomes worthless (as it did), he can get his money back with legal interest while he was speculating with defendants’ money.

I would follow Chief Justice Williams in Stone v. Enstam, 541 S.W.2d 473, 478 (Tex.Civ.App. — Dallas 1976, no writ), wherein the original statute was applied. I decline to use the 1977 version of the statute of “limitations to achieve a windfall for a plaintiff who speculated and lost; instead, I would affirm the judgment of the trial court.

      . Tex.Rev.Civ.Stat.Ann. art. 581-33 was substantially rewritten by the 65th Legislature. See Tex.Rev.Civ.Stat.Ann. art. 581-33 and Comment (Supp.1978). However, this action was tried under, and will be reviewed under, prior law. See Tex.Laws 1977, ch. 170, Sec. 2 at 348.

      . The 1977 amendment to the statute discussed hereinafter has cleared up the question presented by this case as discussed in this dissenting opinion.

      . It was stipulated that “Mr. Lintz was an active and sophisticated trader” in the stock market, having accounts with eight or more brokers in Houston and even held a seat on the Chicago Board of Trade sometime prior to the events forming the basis of this suit.


author: GUITTARD, Chief Justice.

text:
    Charles Norman COLE, Appellant, v. Sarah Louise COLE, Appellee.
    No. 19479.
    Court of Civil Appeals of Texas, Dallas.
    May 19, 1978.
    Rehearing Denied June 29, 1978.

      Gerald R. Coplin, Passman, Jones, Andrews, Coplin & Holley, Dallas, for appellant.
    R. W. Bill Glenn, Plano, for appellee.
   GUITTARD, Chief Justice.

This is the second appeal in a property dispute between divorcing spouses. We reversed the earlier decree because we concluded the court erred in failing to consider the potential income tax liability for both spouses and Sarah Cole’s lack of resources to discharge any additional tax liability against her. Cole v. Cole, 532 S.W.2d 102 (Tex.Civ.App. — Dallas 1975, no writ). The record on that appeal showed also a substantial disparity in earning capacity, which the court apparently declined to consider. Accordingly, insofar as the decree divided the estate of the parties, the judgment was reversed and the cause was remanded for a new trial with instructions to consider the potential tax liability and the disparity in earnings in making a division of the property-

After remand, the trial judge heard evidence on the tax liability, the earning capacity of each of the parties, and many other matters bearing on the division of the property. The evidence in the former trial was considered by the judge and both parties as being before the court, and the record of that trial was referred to from time to time. New evidence showed that the tax liability had been discharged, so far as could be determined. After two extensive hearings, the court signed a revised divorce decree dividing the property substantially as before, but with one exception, to which Charles Cole objects on this appeal. In lieu of a partition of certain land awarded to him in the earlier decree, the court awarded Sarah a money judgment against Charles in the amount of $10,000, payable at $500 a month for twenty months.

On this appeal Charles does not challenge the ultimate division of the property as being unjust or unfair or as an abuse of the court’s discretion under section 3.63 of the Texas Family Code. His only attack is his complaint that in doing so, the judge went beyond this court’s instructions. He argues that to require him to make monthly payments in lieu of a partition of real estate which had already been set aside to him in the earlier decree amounts to an unauthorized award of alimony after divorce.

We do not construe our instructions so' narrowly. In reversing and remanding for a new trial with respect to division of the estate of the parties, we directed the trial court to consider the disparity of earning capacity as well as the potential tax liability. In accordance with our instructions, the judge heard additional evidence of the earnings of each party and made further findings and conclusions. These findings and conclusions show that in making the final division the judge took into consideration the physical condition of the parties, their earning power, their business opportunities and capacities, and the benefits which the spouse not at fault would have derived from the other spouse through continuation of the marriage. In view of these circumstances, the judge concluded that in accordance with the mandate of this court, and in lieu of the existing real property awarded to Charles, one of the factors to be considered in making a fair, just, and equitable division of the estate of the parties would be a money judgment against Charles in the amount of $10,000. Accordingly, he modified the former division in this respect. Although Charles attacks certain of the trial court’s findings of fact on which this judgment is based, our examination of the record has convinced us that the evidence is sufficient to support the findings and that the judge neither disregarded our instructions nor abused his discretion to make such a division of the property as he found to be just and right and with due regard for the rights of the parties.

Charles contends further that the court erred in awarding Sarah a monetary sum in addition to the properties awarded to her in the original decree because she is estopped from seeking a different or additional award by voluntarily accepting the benefits of that decree. The record shows that after this court remanded the case for further proceedings, Sarah sold the homestead awarded to her and paid the indebtedness against it. The trial court found that her income was insufficient to meet the monthly payments of that indebtedness.

We conclude that this is not a proper case for the application of the rule announced in Carle v. Carle, 149 Tex. 469, 234 S.W.2d 1002 (1951), that a party cannot treat a judgment as both right and wrong, and, therefore, is estopped to appeal if he has accepted the benefits of the judgment. That opinion is based on voluntary acceptance of benefits under a judgment. In view of the trial court’s finding that Sarah’s income was insufficient to meet the monthly payments on the indebtedness against their homestead and her testimony concerning the expense of maintaining the home, we cannot say that the sale was voluntary. Certainly, she was not required to default on the indebtedness and suffer a foreclosure while waiting for another hearing in the trial court. Acceptance of benefits under divorce decrees in comparable circumstances has been held not to be voluntary. Trevino v. Trevino, 555 S.W.2d 792, 796 (Tex.Civ.App. — Corpus Christi 1977, no writ); Haggard v. Haggard, 550 S.W.2d 374, 376 (Tex.Civ.App. — Dallas 1977, no writ); cf. McCartney v. Mead, 541 S.W.2d 202, 205 (Tex.Civ.App. — Houston [1st Dist.] 1976, no writ) (discussing inability of party to make an appeal bond except with assets awarded by judgment).

Charles also contends that the trial court erred in striking his counterclaim filed after remand. In that counterclaim he alleged that Sarah had failed to deliver certain property awarded to Charles in the earlier decree, that she had impaired his credit by unauthorized use of his credit cards while she was receiving temporary alimony payments, and that the court’s former decree should be specifically enforced. Sarah moved to strike the counterclaim on the ground that it was not within the issues on remand as limited by this court’s instructions, and the judge sustained the motion.

On this appeal, Charles argues that since Sarah was permitted to reopen the property division and claim more than the property allotted to her in the original decree, he also should have been permitted to claim affirmative relief or offsets by his counterclaim. Our examination of the record persuades us that no prejudice is shown by the trial court’s ruling. So far as enforcement of the original decree is concerned, the second decree gives him the same property as before, subject to the $10,000 payment. If Sarah fails to deliver any property that Charles is entitled to under that decree, he may then apply to the court for enforcement. With respect to the other matters alleged in the counterclaim, the record affirmatively shows that the court’s action in striking the counterclaim did not prevent his counsel from presenting any evidence he desired to present on the property-division issue. The trial judge was more than patient in permitting counsel for both parties to interrogate the parties in detail about a great variety of matters, some of which had little bearing on the issue of fair and just division of the properties. Presumably, the judge took every relevant item of evidence into consideration in making his final division of the properties, and Charles does not suggest that he had any additional evidence that he was prevented from presenting. The judge was careful to follow this court’s instructions and to give both parties a full and fair hearing. We conclude that the found decree was well within our instructions and within the discretion allowed by section 3.63.

Affirmed.


author: MURRAY, Justice.

text:
    In re the Adjudication of WATER RIGHTS OF the CIBOLO CREEK WATERSHED OF the SAN ANTONIO RIVER BASIN.
    No. 15972.
    Court of Civil Appeals of Texas, San Antonio.
    May 24, 1978.

      William S. Rose, Powers & Rose, Austin, for appellant.
    Douglas G. Caroom, Asst. Atty. Gen., Austin, R. Glenn Jarvis, McAllen, amicus curiae.
    Ewers, Toothaker, Ewers, Abbott, Talbot, Hamilton & Jarvis, McAllen, amicus curiae.
   MURRAY, Justice.

This case involves the adjudication of water rights along the Cibolo Creek. The adjudication is authorized by the Water Rights Adjudication Act, Tex.Water Code Ann. § 5.301, et seq. (1972). Claimant Ross Owen Scull owns two tracts of land on the Cibolo Creek, one of which is located in Wilson County, and the other being located in Guadalupe County. Claimant Scull pursued recognition of a water right on his Wilson County tract, both at the administrative level before the Texas Water Rights Commission, and on appeal to the district courts. The Commission recognized no water right on the Wilson County tract. The district court, considering claimant’s exception to the final determination under § 5.318-5.322, recognized a water right to 80 acre feet on the Wilson County tract based upon prescription and equity, and the Commission has not appealed from the district court’s action in this regard. Claimant Scull appeals the district court’s failure to recognize a water right on the Guadalupe County tract, and raises several issues concerning the constitutionality of the adjudication act. Claimant never asserted water rights on the Guadalupe County tract before the Commission and did not raise the issue in his exceptions to the final determination filed with the district court.

Both tracts were originally granted by the Mexican or Spanish Government and have been irrigated with water from the Cibolo Creek for many years.

Claimant has assigned eight points of error, the first seven of which concern themselves with the assertion that vested property rights cannot be taken without compensation, without due process, or retroactively. Claimant, in his conclusion, asked this Court to reverse and render the judgment of the trial court to reflect a riparian right and/or equitable right of claimant to irrigate the Guadalupe County tract. Claimant’s constitutional challenge could be advanced by an owner of a vested water right. State Board of Water Engineers v. Slaughter, 382 S.W.2d 111 (Tex.Civ.App.— San Antonio 1964, writ ref’d n. r. e.).

We hold he has no such right and is therefore not entitled to test the constitutionality of the adjudication act. One challenging a statute must clearly show in its operation it is unconstitutional as to him in his situation and the fact that it may be unconstitutional as to others is not sufficient. 16 C.J.S. Constitutional Law § 76 (1956). We think the law is as stated in 16 C.J.S. Constitutional Law § 76 (1956):

In other words, one may attack the constitutionality of a statute only when and as far as it is being, or is about to be, applied to his disadvantage; and to raise the question he must show that the alleged unconstitutional feature of the statute injures him and so operates as to deprive him of a constitutional right, and, of course, it is prerequisite that he establish in himself the claimed right which is alleged to be infringed.

See Oil Well Drilling Co. v. Associated Indemnity Corp., 153 Tex. 153, 264 S.W.2d 697 (1954); Moody v. State, 538 S.W.2d 158 (Tex.Civ.App. — Waco 1976, writ ref’d n. r. e.).

Claimant’s contention that he has riparian irrigation rights is without merit. We believe it is the settled law of this state that in the absence of specific grants of irrigation water rights, Spanish and Mexican land grants do not have appurtenant riparian irrigation rights. Valmont Plantations v. State of Texas, 163 Tex. 381, 355 S.W.2d 502 (1962). In Valmont v. State of Texas, supra, the Supreme Court adopted as the opinion of the Supreme Court the opinion by Justice Pope, then of the San Antonio Court of Civil Appeals, in the case of State v. Valmont Plantations, 346 S.W.2d 853 (Tex.Civ.App. — San Antonio 1961, opinion adopted). The fact that Valmont concerns riparian irrigation rights on the Rio Grande River does not lessen its effect on the law applicable to Spanish and Mexican grants in this state on other rivers and streams.

Claimant’s position that he had a vested equitable irrigation right to use water for irrigation purposes on the Guadalupe tract is without merit. Claimant cites the case State v. Hidalgo County Water Control and Improvement District No. 18, 443 S.W.2d 728 (Tex.Civ.App. — Corpus Christi 1969, writ ref’d n. r. e.), as recognizing a constitutionally protected vested equitable right to irrigate. In Water Improvement District No. 18, supra, which was filed by the State of Texas to obtain an adjudication of the water rights to the American share of the waters of the Rio Grande, all claimants of water rights along the Rio Grande were required to file their claims with the court. The question of vested riparian irrigation rights was severed from the case and decided by Valmont Plantations, supra. In Water Improvement District No. 18, supra, the court divided the claimants into Class A and Class B. Class A embraced those users who had acquired a right to use water of the Rio Grande by virtue of having complied with the appropriations statute of the state or those whose rights had been recognized by the state. Class B embraced those users who had been making a good faith use of the waters of the Rio Grande River for irrigation purposes prior to institution of the suit, but who had no legal right to use the water. Justice Norvell recognized that the prior use of water for irrigation purposes did not ripen into a vested legal irrigation right when he said at page 731, “The circumstance that numerous tracts of land in the Lower Rio Grande Valley, having no connection with the legal title to an appropria-tive right, have been under irrigation for a long period of time does not authorize us to disregard the Valmont decision and say that such lands have a legal appurtenant water right under the appropriation statutes of this State,” and again, on page 745: “However, the equity arm of a court is not inoperative in the presence of an unprecedented situation.” The unprecedented situation consisted of the fact that two large reservoirs had been constructed at federal expense under an international treaty with Mexico and these reservoirs made large quantities of water available for users in Texas, at no expense to anyone involved. The court’s recognition of equitable water rights was entirely dependent upon the existence of large quantities of free water which would otherwise flow unused into the Gulf of Mexico.

Justice Norvell noted that there was no precedent, in Texas or elsewhere, for the recognition of “equitable water rights,” and that there was no precedent controlling the unusual situation presented by the new source of abundant water on the Rio Grande. Justice Norvell recognized the importance of this unprecedented situation, stating on page 747:

As above pointed out, there is in this state a strong public policy against waste. It hardly seems appropriate to say that in times of abundant water, we must nevertheless adopt a strict literal construction of statutes that were not designed for and hence in part are not suited to the regulation of rights in and to waters stored by governmental action when such course would deprive good faith users of water and allow the same to flow unused to the Gulf. These good faith users are before the court for the purpose of having their rights adjudicated. If it rests within the power and authority of the court to adjudicate such claims, relief should not be denied. In our opinion, equitable rights may be recognized because of the considerations above mentioned.

It is undisputed that there is no abundance of water on the Cíbolo Creek and in the absence of the unusual and extraordinary circumstances existing on the Rio Grande River as detailed in Water District No. 18, supra, we are not authorized to recognize equitable water rights.

By claimant’s eighth point of error, he asserts that the State is estopped to deny irrigation rights because of certain representations made to claimant by certain agents of the Commission, including an attorney. The State, in conducting its adjudication, and its agents, in making prior representations to claimant, were acting in a governmental capacity. Claimant’s contention is without merit, for the applicable rule of law which claimant acknowledges is that estoppel does not run against the State acting in a governmental capacity. City of Hutchins v. Prasifka, 450 S.W.2d 829 (Tex.1970); Texas Company v. State, 281 S.W.2d 83 (Tex.1955).

Public water of the State is the property of the State of Texas. Tex.Water Code Ann. § 5.021 (1972). The State or the sovereignty who was its predecessor is the source of all titles and for that reason there exists a presumption in favor of the state until the claimant shows a valid grant out of the sovereignty. State v. Delesdenier, 7 Tex. 76 (1851); Hamilton v. State, 152 S.W. 1117 (Tex.Civ.App. — Austin 1912, writ ref’d). Claimant is not entitled to test the constitutionality of the adjudication act because he has not shown that he complied with the state law with reference to the acquisition of a right of irrigation from the Cíbolo Creek. The judgment of the trial court is affirmed.

      . We will follow claimant’s and State’s suggestion and utilize the section numbers of the prior codification rather than the new codification adopted by the Acts of the 65th Legislature, Chap. 870, 1977.


text:
    Paul BROWN d/b/a Paul's Electric Company, Appellant, v. PAYNE-LADEWIG, INC., Appellee.
    No. 19500.
    Court of Civil Appeals of Texas, Dallas.
    May 24, 1978.
    Rehearing Denied June 29, 1978.
    Marshall W. Dooley, Herndon, Girand & Dooley, Dallas, for appellant.
    Clarence 0. Bentley, Dallas, for appellee.
   GUITTARD, Chief Justice.

In this suit for breach of contract, the verdict was favorable to plaintiff, but the trial court rendered judgment for defendant notwithstanding the verdict on the ground that the evidence shows as a matter of law that the contract was subject to a condition which was never met. We hold that the trial court erred in this respect. Accordingly, we reverse and remand with instructions to render judgment on the verdict.

Plaintiff Paul Brown was a heating and air-conditioning contractor who was preparing to bid on a subcontract for installation of air-conditioning and heating equipment in connection with the remodeling of a government family-housing project at Fort Hood, Texas. He approached defendant Payne-Ladewig, Inc., a supplier of such equipment. Defendant obtained a copy of the specifications from the United States Army Corps of Engineers, and defendant’s estimator, Tom Keegan, gave Brown a quotation on the telephone of $53,569 for supplying the equipment and the price. Brown used this quotation in making his bid to the general contractor, who, in turn, used Brown’s bid to make a successful bid to the Corps of Engineers. When the general contractor’s bid was accepted, Brown notified Keegan and instructed Keegan to go ahead and prepare data on the equipment for submission to the Corps of Engineers for approval. After two unsuccessful attempts to obtain approval of Payne-Ladewig’s equipment, Brown obtained equipment from another supplier at an increased price and brought this suit to recover the difference, alleging that Payne-Ladewig had failed to supply the equipment required by the specifications. Payne-Ladewig denied that a binding contract was made and alleged that its written quotation was conditioned upon approval by the Corps of Engineers and placement of an order by Brown for the equipment, that final approval by the Corps of Engineers was never obtained, and that Payne-Ladewig never received an order from Brown.

In response to special issues, the jury found (1) that plaintiff and defendant entered into an agreement whereby plaintiff agreed to purchase and defendant agreed to sell the items of equipment listed at the prices stated in defendant’s quotation, (2) that defendant failed to supply those items in accordance with the terms of their agreement by reason of the fault, act, or omission of the defendant, and (3) that the amount of plaintiff’s damages resulting from defendant’s failure to comply with the agreement was $27,853.

The defendant filed a motion for judgment in its favor notwithstanding the verdict, which the court granted. The only ground recited in the judgment for disregarding the verdict is that the court “is of the opinion and finds that as a matter of law performance by defendant Payne-La-dewig, Inc. was conditioned upon approval of the equipment by the United States Corps of Engineers.”

On this appeal, plaintiff contends that the trial court erred in this finding because no facts were presented to support it, or at least, that it was based on disputed facts which should have been submitted to a jury on a proper request. After a review of the evidence, we agree that existence of the alleged condition was not established as a matter of law.

The question of existence of a condition precedent must be determined in the light of the specifications for the job prepared by the Corps of Engineers, on which both parties, as well as the general contractor, made their bids. The plans specify one hundred and one units of air-conditioning and hearing equipment, of three different capacities, for housing units to be remodeled. The specifications require the general contractor to proceed as soon as practical after notice and, before commencement of installation of materials and equipment, to submit to the government representative for approval a complete schedule of materials and equipment proposed for installation. The specifications further provide that approval of materials will be based on the manufacturer’s published ratings, that those not in accordance with specifications will be rejected, and that no payment will be allowed for materials incorporated into the work if the required approvals have not been obtained. The general contractor is also required to submit shop drawings for approval before proceeding with any of the work.

The only provision in the contract documents for approval or disapproval of the contractor’s submittals with respect to materials and equipment is the authority of the Corps of Engineers to determine compliance or non-compliance with the plans and specifications. Defendant asserts that the specifications are loosely drawn and leave much for subjective determination by the engineers, but there is no evidence supporting this assertion. There is testimony that frequently several submittals are required before approval is secured, but, insofar as appears in this case, disapproval of the submittals was based on the engineers’ determination that the equipment described in the defendant’s submittals did not comply with the plans and specifications. When Brown was asked on cross-examination whether some of the specifications were vaguely drawn so that what might apparently meet the specifications might not meet the approval of the Corps of Engineers, he responded, “No, if you can prove that you can meet it, they will accept it.” There is no evidence to the contrary.

The testimony shows that in accordance with the requirements of the specifications concerning advance approval of materials and equipment, the practice was for the material supplier to provide its submittals concerning the equipment to the subcontractor, who passed them on to the general contractor, who, in turn, presented them to the Corps of Engineers for approval. If the Corps of Engineers disapproved any item or required additional data, the matter was passed back down the line to the supplier, who then provided additional information in another submittal. Since the bids of the subcontractors and suppliers, like that of the general contractor, were based on the specifications, it is reasonable to construe such bids, when accepted, as obligating the bidders to furnish the information to be submitted by the general contractor for approval. Such a construction is supported by decisions holding that contracts that refer to specifications have the effect of incorporating the specifications into the contract. Tower Contracting Co. v. Flores, 157 Tex. 297, 302 S.W.2d 396, 398 (1957); Delhi Pipeline Corp. v. Lewis, Inc., 408 S.W.2d 295, 298 (Tex.Civ.App. — Corpus Christi 1966, no writ).

In this case, the evidence is clear that the parties dealt on the basis of the specifications and the procedure for approval of equipment prescribed in the specifications. Both parties had had long experience with government contracts of this kind. Defendant’s estimator, Tom Keegan, obtained a copy of the specifications before making his bid. He testified that the submittals were intended for the use of the Corps of Engineers to determine whether the equipment complied with the terms of the contract.

The principal controversy between the parties is whether defendant’s obligation to supply the equipment was conditioned upon approval of its submittals by the Corps of Engineers, or whether defendant had an obligation to furnish equipment that would comply with the specifications, as determined by the Corps of Engineers. The evidence, as we view it, raises at least a fact issue that defendant was obligated to furnish equipment that would comply. Keegan testified that when he gave his quotation, he told Brown that the price was “subject to approval by the Corps of Engineers through the acceptance of the equipment.” He also testified, however, that he told Brown that Payne-Ladewig “could comply and would comply at that price.” No such condition appears in his written quotation of the following day, which says, “This quotation shall remain firm for a period of 60 days from this date.” Keegan acknowledged that he represented to Brown that to the best of his knowledge the equipment would comply with the specifications and that he understood that Brown would use the quoted figure in making his bid to the general contractor. Brown then advised him that the price quoted was the best he had received and that he would probably use it. According to Keegan, Brown called him back later, said that he had been awarded the contract, and instructed him to “go ahead and make up the submittal, which means ten copies of drawings and specifications that he would have to submit to the Corps of Engineers.”

Brown’s testimony concerning his conversations with Keegan does not differ materially from Keegan’s, except that he does not confirm Keegan’s statement that the price was subject to approval of the Corps of Engineers. Brown said that when Keegan gave him the price, he found that it differed so much from the other prices he had received that he called Keegan back and asked him if he had looked at the specifications and was satisfied with the price, and Keegan said that he was. Brown told him that he was going to use Keegan’s bid because it was lower, and he then telephoned the general contractor and gave his own price for the subcontract.

On cross-examination, Brown testified that he told Keegan that Payne-Ladewig “would have the job if it meets specifications,” and if they did not meet the specifications, they did not have an order. After he was awarded the subcontract, he told Keegan to get the submittal in and approved as soon as possible. He said that he considered himself bound if Payne-Ladewig met the conditions, but did not consider himself unconditionally bound if they did not deliver what he had bought.

This testimony is sufficient to support a jury finding that the approval of the Corps of Engineers was not a condition to the existence of the contract, but was a method of determining in advance of delivery whether the equipment offered would meet specifications. The jury was justified in regarding Payne-Ladewig’s quotation as an offer, which was accepted when Brown told Keegan that he had been awarded the contract and to proceed with the submittal, so that Payne-Ladewig was then bound to furnish the equipment in accordance with the specifications. Under this view of the evidence, Brown’s obligation to order the equipment and pay for it was conditioned on approval by the Corps of Engineers, but Brown was contractually bound, as was Payne-Ladewig, to seek such approval. The specifications imposed on the general contractor the obligation to submit the required information for approval before installation of the equipment. Each subcontractor and supplier whose bids were accepted had the same obligation within the scope of their respective contracts. These submittals were as much an obligation of the contract as delivery and installation of the equipment. When Brown told Keegan to proceed with the submittal, he was in effect instructing Payne-Ladewig to proceed with performance of the contract in accordance with the specifications.

Any other interpretation of the evidence would be unreasonable. The obligation to submit- data for approval was that of the general contractor, and surely no one would seriously contend that the general contractor would have had no obligation to the government if his submittals had not been approved by the Corps of Engineers. Unless the same obligation was imposed by the specifications on the subcontractors and suppliers whose bids were accepted, no contractor would ever be in a position to make a firm bid. Keegan admits that he knew that Brown would use the price quoted for the equipment as the basis for a firm bid on the air-conditioning and heating subcontract. Keegan must have known also that Brown would not have been in a position to make a firm bid if Payne-Ladewig’s bid on the equipment had not been equally firm. To say that a supplier has no obligation until its equipment is approved would be to say that simply by failing to supply all the information required concerning his equipment, he could avoid any obligation and subject the subcontractor to whatever increased expense he might incur by obtaining equipment elsewhere. It is unreasonable to suppose that either party so intended. If the procedure had been to obtain approval of the equipment from the Corps of Engineers before the general contractor became bound to the government and the subcontractors became bound to the general contractor, then there might be some logic in finding that the supplier had no obligation until his equipment were approved, but that was not the case here. The specifications make it clear that approval is required after the parties are bound. Consequently, we conclude that the trial court erred in holding as a matter of law that performance by Payne-Ladewig was conditioned on approval by the Corps of Engineers.

In conclusion, although we reverse the trial court’s action in disregarding the verdict, we commend the procedure the court adopted in this case. After extensive argument by defendant on a motion for instructed verdict, the court overruled the motion, submitted the case to the jury, and considered the same questions again on defendant’s motion for judgment notwithstanding the verdict. This procedure has enabled this court to make a final disposition of the litigation without a second trial. When a jury has heard the evidence, a peremptory instruction, though permitted by the rules, rarely, if ever, contributes to the efficient administration of justice. We encourage all trial courts to follow the procedure adopted in this case.

For the reasons stated, we reverse the judgment of the trial court and remand the cause to the trial court with instructions to determine the amount of interest to which plaintiff is entitled and to render judgment for plaintiff on the verdict for the amount of the damages found by the jury, together with interest in the amount so determined.


author: AKIN, Justice.

text:
    A. L. PARKER, Appellant, v. Walter H. GANT et al., Appellees.
    No. 19547.
    Court of Civil Appeals of Texas, Dallas.
    May 31, 1978.
    Rehearing Denied July 11, 1978.
    Philip F. Patman, Patman & Patman, Austin, Paul Brown, Brown, Hill, Ellis & Brown, Sherman, for appellant.
    Robert G. Bush, III, Joe A. Keith, Sherman, David M. Stagner, Denison, for appel-lees.
   AKIN, Justice.

This is an appeal from a judgment granting a bill of review, setting aside a default judgment, and denying all relief sought in the original action. The action was originally instituted on December 7, 1973, as Cause No. 81561 by A. L. Parker, appellant, a mineral lessee, for a judicial determination that an earlier mineral lease on the same property held by appellee, Walter Gant, had terminated because of Gant’s failure to conduct reworking operations after production had completely ceased from the only well on the lease. When Gant failed to answer, a default judgment was rendered in favor of Parker. More than thirty days after entry of the default judgment, Gant filed a bill of review seeking to set aside the default judgment. This action was docketed in the trial court as Cause No. 82293. The matter asserted in the bill of review was tried to a jury, which found:

(1) That the failure of Walter H. Gant to appeal was without negligence on his part in the course of the former trial or after judgment;
(2) That the failure of Walter H. Gant to file an appeal to the judgment taken by A. L. Parker in Cause No. 81561 was not intentional and not due to conscious indifference on his part;
(3) That Walter H. Gant was not prevented from appealing the judgment taken against him by A. L. Parker by the fraud, accident, or wrongful act on the part of A. L. Parker or his attorneys. [Emphasis added]

No issues were submitted with respect to any excuse for Gant’s failure to file an answer before the default judgment was rendered. Acting on these findings, the trial court rendered a judgment dated October 18, 1974, which we consider interlocutory, granting Gant’s bill of review declaring the default judgment void, but not adjudicating whether Gant’s lease was still in force. The same judgment ordered a trial on the merits at a subsequent date. Parker amended his pleadings in Cause No. 81561, the cause number of the default judgment, which was then consolidated with Cause No. 82293 (the cause number given the bill of review). In the consolidated case, a second jury found that Gant did not fail to engage in reworking operations for the period in question. On June 24, 1977, the court entered its final judgment again declaring the default judgment void and declaring that Gant’s lease had not terminated. Parker appeals. We hold that Gant failed to establish by jury findings or by undisputed evidence facts that would justify granting a bill of review. Accordingly, we reverse and render judgment denying the bill of review, thus leaving the default judgment in full effect.

Gant first argues that Parker cannot now complain of any errors in the bill of review proceeding since the judgment of October 18, 1974, was a final judgment as to any issues that might have been litigated between Parker and Gant with respect to setting aside the default and that no timely appeal was perfected from that judgment. Appellee’s contention ignores the fact that the bill of review judgment of October 1974, only disposed of the issue of the validity of the default judgment and clearly stated that the merits of the cause were still to be tried. Thus, that judgment was interlocutory since it did not dispose of the case on its merits and no appeal could have been taken by Parker. In Warren v. Walter, 414 S.W.2d 423 (Tex.1967), the supreme court held that a judgment entered in a bill of review proceeding setting aside a default judgment without disposing of the merits was interlocutory and affirmed a dismissal of an appeal from the order. Here no final judgment was rendered until the judgment was rendered disposing of the case on its merits. Thus, Parker’s appeal from the action of the trial court in granting the bill of review is timely. Consequently, Parker’s complaints concerning the propriety of granting the bill of review as well as the judgment on the merits are properly before us.

Appellant argues that the court erred in granting the bill of review and setting aside the default judgment because appellee failed to obtain jury findings that would justify the court in setting aside the default judgment. We agree. In this respect, we note that Gant pleaded that his failure to answer was not due to his negligence or lack of diligence, that his failure to answer and present a defense was not intentional or the result of conscious indifference, and that he had a meritorious defense. These allegations state all of the grounds, except one, for relief from a default judgment when a timely motion for new trial is filed. Craddock v. Sunshine Bus Lines, 134 Tex. 388, 133 S.W.2d 124 (1939). They do not, however, state the more onerous grounds for a bill of review laid down in Alexander v. Hagedorn, 148 Tex. 565, 226 S.W.2d 996, 998 (1950), which require the party complaining of the judgment to allege and prove (1) a meritorious defense to the cause of action alleged to support the judgment, (2) which he was prevented from making by the fraud, accident or wrongful act of the opposite party, (3) unmixed with any fault or negligence of his own. Gant neither pleaded nor offered proof of these requirements for a bill of review.

Appellant does not insist, however, on the strict grounds for a bill of review laid down in Alexander v. Hagedorn, supra, apparently on the assumption that the case is governed by Hanks v. Rosser, 378 S.W.2d 31, 35 (Tex.1964), in which the supreme court applied a less onerous standard to a defendant whose failure to file a timely motion for new trial was induced by misinformation from the clerk. In Hanks, the clerk of the court, while acting within his official duties, erroneously advised defendant’s counsel that no default judgment had been rendered. Acting on this misinformation, defendant filed an answer but failed to file a timely motion for new trial. The supreme court held that the trial court may grant a bill of review (1) where the failure to answer was not intentional or the result of conscious indifference, (2) where a litigant is misinformed by the clerk within the time for filing a motion for new trial and is therefore prevented from filing, or misled into not timely filing his motion, (3) where a meritorious defense is shown, and (4) where no injury will result to the opposite party. In this situation, the court held that the defendant was not required to show that his failure to answer or to file a timely motion for new trial was caused by fraud, accident or the wrongful act of the opposite party, or that the defendant was himself free of negligence. As we read Hanks, where the clerk gives misinformation, the supreme court eliminated the Hagedorn requirements (1) that the defendant was prevented from answering by the fraud, accident, or wrongful act of the other party and (2) that the failure to answer was unmixed with any fault or negligence on the defendant’s part. Instead of freedom from fault or negligence in failing to answer, the court required a lesser standard that the failure to answer was not intentional or the result of conscious indifference. In lieu of the Hagedorn requirement of proving that the defendant was prevented from answering by some wrongful act of the opposite party, the Hanks court substituted the requirement of misinformation by the clerk and a showing that no injury will result to the opposite party. Thus, in the situation of misinformation by the clerk, Hanks reduced substantially the burden upon the defendant in obtaining a bill of review.

Later, in Petro-Chemical Transport, Inc. v. Carroll, 514 S.W.2d 240, 244 (Tex.1974), the supreme court stated that the failure of the clerk to send the postcard notice of entry of judgment as required by Tex.R. Civ.P. 306d is equivalent to misinformation by the clerk. Consequently, that court concluded that the Hanks v. Rosser, supra, standard applied where the clerk failed to send notice of entry of judgment thereby preventing the defendant from timely filing a motion for new trial and from perfecting his appeal.

From these authorities, we conclude that Gant had the burden of pleading and proving that: (1) defendant’s failure to answer was not intentional or the result of conscious indifference; (2) the clerk failed to send notice required by Tex.R.Civ.P. 239a of the default judgment, thus preventing him from filing timely a motion for new trial; (3) a meritorious defense, and (4) no injury to the opposing party. Hanks v. Rosser, at 35.

We agree with appellant that these requirements were not met. In this respect, Gant failed to allege and establish that no injury will result to the plaintiff from the granting of the bill of review. Indeed, the record clearly indicates that Gant’s conduct produced a substantial delay. Forty-six days after the default judgment was entered on December 7, 1973, Gant filed his bill of review. It was then set down for a hearing forty-five days later. Subsequently, Gant filed a motion for continuance, and when that was overruled, he took a non-suit. Gant then instituted a new bill of review in June of 1974, and a hearing on that was delayed another three months. In the absence of any pleading, evidence or jury finding that Parker would not be caused to suffer any injury by this delay, it was error under the standards of Hanks v. Rosser, supra, for the trial court to grant the bill of review.

Additionally, Gant failed to meet two other requirements necessary under Hanks for a bill of review. He neither pleaded nor obtained a jury finding that his failure to answer the original action was not intentional or the result of conscious indifference. Moreover, although he pleaded that the clerk failed to send the notice of default judgment, he obtained no jury finding to that effect, and he does not complain of the court’s failure to submit that issue.

Since we have held that Gant failed to discharge his burden with respect to his bill of review, we reverse the judgment of the trial court granting the bill of review and render judgment denying the bill of review, thus leaving the default judgment in full effect.

Reversed and rendered.

      . Gant did not allege that the granting of a new trial would not work an injustice to Parker nor did he offer to reimburse Parker for the costs incurred in obtaining the default.

      . We note that this requirement was not involved in Petro-Chemical, supra, because in that case the defendant had answered and had participated in the trial.


text:
    GARY SAFE COMPANY, Appellant, v. A. C. ANDREWS CO., INC., Appellees.
    No. 19537.
    Court of Civil Appeals of Texas, Dallas.
    May 31, 1978.
    Rehearing Denied June 27, 1978.

      Ralph I. Miller, Nancy L. Benoit, Thompson, Knight, Simmons & Bullion, Dallas, for appellant.
    Wm. T. Andress, Jr., Dallas, for appellees.
   AKIN, Justice.

This is an appeal by Gary Safe Company from a judgment granting A. C. Andrews Co., Inc. recovery of $78,125.66 for sales commissions based upon an alleged contract. The judgment also provides that Andrews is entitled to future sales commissions on all sales made by Gary to the Southland Corporation. The trial court found that a letter sent by Gary to Andrews stating that Gary would pay $25 to Andrews for each unit sold Southland became a binding contract by tacit acceptance by Andrews. The court also found that under this contract Andrews was entitled to a commission of $25 per unit for the life of the relationship between Gary and South-land. Gary Safe attacks the judgment on the grounds that there was no consideration on the part of Andrews and that even if consideration existed, Gary Safe could terminate the alleged contract at will. We hold that no consideration flowed to Gary Safe and that, consequently, no binding contract existed between the parties. Accordingly, we reverse and render.

Before the transaction now in question, Gary Safe, a manufacturer, had sold safes to Andrews Company for resale, although no agreement existed between Gary Safe and Andrews with respect to a designation of Andrews as a distributor or authorized dealer for safes manufactured by Gary. In the early 1960’s, Andrews commenced selling floor safes to Southland Corporation for their convenience stores, using Gary Safe as the supplier. In 1972, Southland requested Andrews to make a particular under-the-counter safe with a money drop for use in Southland’s stores. Gary Safe manufactured this particular safe, designated as Model 3421, according to specifications requested by Andrews. Between 1972 and 1973, Southland purchased 443 of these units through Andrews, with a gross profit to Andrews of $57.50 per unit. In December 1973, Andrews learned that Gary Safe had contacted Southland proposing to sell safes directly to Southland. Andrew’s president, A. C. Andrews, then protested in a letter to Gary that “one of the best ways to mess up a good deal for everybody is for different people from a producer-selling organization to call on personnel with a buying-using corporation.” In response, Gary Safe gave assurance that it would not seek to deal with Southland directly. No contention is made by Andrews that these letters constitute a contract. In January 1974, however, Gary Safe wrote the following letter, which is now alleged to have resulted in a binding contract:

Mr. A. C. Andrews
A. C. Andrews Company
Dallas, Texas
Dear Doc:
Enclosed is a copy of a letter to Mr. Pobilatti of the Southland Corporation. After several telephone conversations he seemed to be satisfied with the prices quoted in our letter to him.
From the prices quoted we will pay you a commission as follows:
A flat $25.00 on each unit known as model 3421, now used by their stores. A commission of 5% for all other safe equipment, the 5% to be figured on the prices at which we sell Southland Corporation.
I have seen no other way to go on this, Doc, and I hope it works out alright.
Sincerely,
Gary Safe Company
Allen Royce

The trial court found that this letter was an offer which implied a “tacit understanding” that Andrews would not interfere with Gary’s direct sales to Southland, and that when Andrews accepted the specified commissions it became a contract binding on Gary as long as Gary should sell safes to Southland. Nevertheless, the trial court also found that Andrews made no promises to perform service, to refrain from competing, or to do or refrain from doing anything as consideration for the commission payments. Additionally, the trial court found that Gary Safe had the right to sell directly to Southland prior to the January 1974 letter and that all payments of commission were made by Gary Safe to Andrews through November 22, 1974 at which time Gary Safe terminated Andrews’ commission payments.

Appellant Gary Safe contends that the trial court erred in concluding that a “tacit understanding” that Andrews would not interfere with Gary’s direct sales to Southland Corporation constitutes consideration for the January 21, 1974, letter because this tacit understanding is inconsistent with the trial court’s finding of fact that no promises were made on behalf of Andrews to perform any services, to refrain from competing, to compromise any disputes, or to do or refrain from doing anything in return for these “commission” payments, and that there were no negotiations concerning the commission arrangement. Appellant concludes that these findings negate consideration flowing to Gary. We agree. In the absence of any benefit to the promisor or detriment to the promisee legally derived from the promise sought to be enforced, there is no consideration, and hence no contract. E. g., Champlin Petroleum Co. v. Pruitt, 539 S.W.2d 356, 361 (Tex.Civ.App. — Fort Worth 1976, writ ref’d n. r. e.); Sanders v. Republic National Bank of Dallas, 389 S.W.2d 551, 555 (Tex.Civ.App.— Tyler 1965, no writ). Therefore, the trial court’s finding that no promises were made on behalf of Andrews is inconsistent with the conclusion that there existed a “tacit understanding” whereby Andrews would not interfere with Gary’s direct sales to Southland. This finding of no promise on the part of Andrews is inconsistent also with the court’s conclusion of law that the relinquishment by Andrews of its established customer, Southland, to direct sales by Gary, and the surrender of a varying profit in exchange for fixed commission constituted consideration for the commission arrangement. Indeed, Andrews could not point to any promise he made in return for the commission. Even if Andrews Company had some interest in selling to South-land that it could relinquish or surrender, no promise of relinquishment or surrender was given in return for the commission payments. Since the trial court’s finding conflicts with the conclusions of law, the findings of fact must control, Howth v. French Independent School District, 115 S.W.2d 1036, 1039 (Tex.Civ.App. — Beaumont 1938), aff’d, 134 Tex. 211, 134 S.W.2d 1036 (1940). Consequently, no consideration existed for Gary’s agreement to pay commissions.

Finally, the trial court’s conclusions of law are also inconsistent. The trial court correctly concluded that Gary Safe had a legal right prior to 1974 to sell directly to Southland Corporation without paying any compensation to the Andrews or Andrews Company but then erroneously concluded that Andrews Company relinquished its established customer when clearly Gary could have sold directly to Southland regardless of any agreement.

The most that can be made of the alleged offer is that it showed an intention by Gary to pay the commission specified in order to induce Andrews not to compete in making direct sales to Southland, but that the arrangement should not bind either party. Any promise, either expressed or implied by Andrews not to compete in the future would have been of doubtful validity under the antitrust law, Tex.Rev.Civ.Stat. Ann. art. 7428 (Vernon 1960). Consequently, there was no consideration for any supposed obligation by Gary to continue paying the commissions.

' For these reasons, we hold that the court erred in concluding that a binding contract existed. Accordingly, we reverse the judgment of the trial court on the counterclaim, and here render judgment that Andrews take nothing.