author: HUGHES, Justice.

text:
    AMERICAN BENEFIT LIFE INSURANCE COMPANY, Appellant, v. HILL COUNTRY LIFE INSURANCE COMPANY, Appellee.
    No. 18072.
    Court of Civil Appeals of Texas, Fort Worth.
    May 17, 1979.
    Rehearing Denied June 14, 1979.
    Mack Ray Hernandez, Austin, for appellant.
    Leonard, Koehn, Rose, Webb & Hurt, Austin, Daugherty, Kuperman, Golden, Car-lisle & Morehead and John F. Morehead and Mary A. Keeney, Austin, for appellee.
   OPINION

HUGHES, Justice.

American Benefit Life Insurance Company, an Alabama corporation, has appealed a judgment of the trial court which approved a plan of rehabilitation (reinsurance of the policies of the insolvent Old National Insurance Company, also an Alabama corporation). Hill Country Life Insurance Company, appellee, was allowed to reinsure the policies under its proposal. Hill Country is a Texas corporation. American Benefit contends in its only point of error that trial court abused “its discretion in reviewing and adjudicating against the appellant’s plans for reinsurance of the business of the insurance company in receivership.”

We affirm.

This case was tried by the court on December 19 and 20, 1977 and involved the ancillary receivership of Old National which dated from March 30, 1970. The Liquidation Division of the State Board of Insurance had petitioned for the receivership. Also, the State of Alabama had placed Old National in domiciliary receivership. A trial was had in Alabama on December 12, 1970 involving the same subject matter and the same three companies seeking the same respective ends as in this Texas proceeding.

The Alabama trial court, sitting in equity, favored the Hill Country proposal with a judgment the day the trial court in Texas commenced hearing this case. The Alabama judgment is also on appeal.

The question before us is whether or not trial court abused its discretion in ruling that Hill Country plan would be used. Application of People by Van Schaick v. National Surety Co., 239 App.Div. 490, 268 N.Y.S. 88, (Sup.Ct.1933; aff’d. by the Court of Appeals, 264 N.Y. 473, 191 N.E. 521, (1934)).

No findings of fact and conclusions of law were made and none were requested.

All parties to this appeal admit that Old National is insolvent. It has an $800,000.00 excess of liabilities over assets ($2,700,-000.00 v. $1,900,000.00).

Testimony shows that 99.5% of its policyholders live in Texas and that 100% of Old National stock outstanding is owned by American Benefit.

The Hill Country plan of rehabilitation of the Old National policies involves rehabilitating the Old National policyholders to their full status over a sixteen year period. Hill Country proposes to do this by maintaining death benefits in full but by reducing reserve liabilities (or benefits, as viewed by the policyholders) to policyholders. This would be achieved by placing a moratorium on the insureds’ right to borrow against their policies at the usual 5% rate of interest. This would allow Hill Country to keep this money and invest it for a larger return, thus reducing the reserve liability and generating more money for payment of death claims.

This is a reducing lien which will terminate in sixteen years (less if liquidation of Old National assets to acceptable assets is accomplished). As Old National assets are liquidated, their transfer to Hill Country will reduce the moratorium period.

This plan is criticized by American Benefit as having too long a moratorium period as compared to the five year period it proposes with the Hill Country plan having a 100% moratorium as compared to American Benefits’ 50% moratorium (reducing 10% a year to zero in the five year period). Hill Country points out that its sixteen year period starts with 1970 and ends in 1986, whereas the American Benefit period starts in 1977 and terminates in 1982.

American Benefit also criticizes Hill Country’s limited assets of $650,000.00 with capital and surplus of $231,000.00 as compared to its $52,000,000.00 assets and capital and surplus of $13,376,990.00. It must be noted however that American Benefit is not licensed to do business in Texas. There are other factors involving the reliability of the American Benefit plan which we will not discuss.

There is no doubt that under Texas law the appointment of a receiver is largely in the trial court’s discretion. Washington Am. Life Ins. Co. v. State, 545 S.W.2d 291 (Tex.Civ.App.—Austin 1977, no writ). Archer v. Ross, 262 S.W.2d 213 (Tex.Civ. App.—Fort Worth 1953, no writ).

Van Schaick, supra, is cited in the last sentence of the following:

“As a general rule, under general statutes or special statutes pertaining to rehabilitation proceedings, an appeal may be taken from the orders or decrees of the court rendered in the proceedings. When the commissioner files a petition to be appointed conservator and asks authority to work out a rehabilitation plan he institutes a proceeding which is but one proceeding until the proposed plan is ultimately passed on, and intervening orders are merely preliminary orders which may be considered on appeal from the order affirming the rehabilitation plan. A rehabilitation plan approved by the court on application of the superintendent of insurance will not be set aside unless there is proof of abuse of discretion or gross inequity.” (Emphasis ours.) 44 C.J.S. Insurance § 135 (1945).

The matter of overturning the discretion of the trial judge is not to be taken lightly by the appellate court and we are not privileged to substitute our discretion for that of the trial judge. Jones v. Strayhorn, 159 Tex. 421, 321 S.W.2d 290 (1959); Landry v. Travelers Insurance Company, 458 S.W.2d 649 (Tex.1970).

We hold that the trial court did not abuse its discretion in selecting the Hill Country plan.

Affirmed.


source: Caselaw Access Project

author: McKAY, Justice.

license: Public Domain

text:
    SOUTHERN NATIONAL BANK OF HOUSTON, Trustee and Highland Resources, Inc., et al., Appellants, v. The CITY OF AUSTIN, Texas, et al., Appellees.
    No. 1245.
    Court of Civil Appeals of Texas, Tyler.
    May 17, 1979.
    Rehearing Denied June 14, 1979.

      C. C. Small, Jr., Small, Craig & Werken-thin, James M. Alsup, Robert B. Burns, Jr., John J. McKay, Austin, for appellants.
    John Meinrath, Asst. City Atty., Austin, for appellees.
   McKAY, Justice.

This is a suit contesting the validity of a Historical Preservation Ordinance of the City of Austin.

Southern National Bank of Houston, Trustee (Trustee), and Highland Resources, Inc. (Highland), brought this suit against the City of Austin (City), seeking an injunction and declaratory judgment against the City, its City Council members, the Historic Landmark Commission and its members, the Planning Commission and its members, and all City officers, agents and representatives to prevent them from enforcing against their property certain ordinances of the City pertaining to Historic Landmark Preservation. The Heritage Society of Austin, Inc., the State of Texas, and certain shareholders of the Driskill Hotel Corporation intervened. Driskill Operating Company became an involuntary plaintiff by court order, and Louis Page, owner of property adjacent to the Driskill Hotel, filed an intervention.

Highland and its Trustee alleged that the Trustee had legal title in trust and Highland was beneficiary of the trust containing the property known as the Driskill Hotel located in downtown Austin, Texas; that the premises consisted of two component and integrated parts, described generally as the old portion (being generally the south portion of the hotel), and the tower (newer) portion, located on the north area of the property; that in 1971 Highland deeded the north or tower portion (with a part of the old section) to the predecessors in title of the present hotel owner-operator, Braniff Airlines, Inc. (which owns and acts through the Driskill Operating Company), retaining ownership of the balance of the property, and leasing same to the lessee-predecessors of Braniff, under which lease Braniff is tenant and current hotel operator; that the Driskill Hotel for approximately 40 years has been operated as a complete, unified, integrated business, using the entire physical properties of both the tower and the old section, which are joined and unified, both exteriorly and interiorly, in every respect, into a single structure — the tower section having been added as an integrated part of the hotel and being so used and operated.

The pleadings of Highland and its Trustee further alleged that on March 7, 1974, the City enacted Ordinance No. 740307 — A, amending Chapter 45 of the Code of the City of 1967, as amended, and by said amendments enacted provisions identified as Sections 45 — 42 through 45-55 of the City Code of 1967, and has thereby added a new Article IV, “Historic Landmark Preservation,” and created a commission known as Historic Landmark Commission, assigning to it various powers and authority; that purporting to act under color of authority of said 1974 ordinance the City, acting through its City Council, Planning Commission and Landmark Commission, caused certain proceedings to be brought to have the property of Highland zoned “Commercial-Historic District” (C-2-H zoning), by Ordinance No. 760415-E; and that such zoning ordinance described and covered generally the older or southern portion of the premises known as the Driskill Hotel.

The petition then alleged that the City by acting on inadequate notice to Highland denied Highland and its Trustee a reasonable opportunity to protect their rights and property, as well as those owning the leasehold interests; that such ordinance infringed upon and impaired the contractual rights and obligations of the parties and their tenant, and created unreasonable hardships in the maintenance, operation and management of the hotel properties and business in violation of the pre-existing lease and contracts of the parties, and effectively appropriated the rights of the owner and tenant to control, manage and operate their property, and transferred such rights to the City’s boards and agencies; that the City violated their constitutional rights, as well as their rights under Articles 1011a-1011e, Tex.Rev.Civ.Stat.Ann., and acted arbitrarily, capriciously and unlawfully in zoning their property, and that such action was without factual or legal support.

The pleadings of Highland and its Trustee prayed (1) that the City, the City Council members, the Planning Commission and its members, and all the City’s officers, agents and representatives be enjoined from enforcing, or threatening to enforce, directly or indirectly, as against them, their lessee and their property the provisions of Article IV pertaining to Historic Landmark Preservation, being Sections 45 — 42 through 45-55 of the City Code of 1967, as amended, and any amendments thereto; (2) for a declaratory judgment, finding and declaring that the ordinances are unlawful and void as applied to their property, and are violative of their contract rights and impair said contractual obligations with their lessee-tenant; that the court make further declarations of the rights and status of their property as they may be entitled thereto, including a declaration, where applicable, that various provisions of the ordinances have no applicability to their property.

The trial court held that Ordinance No. 760415-E which applied to and zoned the older section of the Driskill Hotel as a Historic Landmark was unlawful, in' violation of the Constitutions of the United States and the State of Texas, and was therefore null and void. That portion of the trial court’s judgment is not appealed from. All other declaratory relief was denied; the prayer of Highland, its Trustee, and the intervenors for a permanent injunction enjoining the City from enforcing Article IV of Chapter 45 of the Code of the City was denied. Driskill Operating Co. was dismissed from the case by the judgment.

Highland, its Trustee, and the Driskill Hotel Corporation, all appellants in this Court, appeal from those portions of the judgment which deny all declaratory and injunctive relief other than that granted against Ordinance No. 760415-E. Appellee, the City of Austin, gave notice of appeal from that portion of the judgment dismissing the involuntary plaintiff, the Driskill Operating Co.

Since Ordinance No. 760415-E has been held to bfe invalid by the trial court, and no appeal is before us on that issue, we deem it unnecessary to detail the findings of fact filed by the trial court setting out the procedures and actions taken by the Historic Landmark Commission, the Planning Commission or the City Council in zoning the older section of the Driskill Hotel as a Historic Landmark (H). In this appeal the attack is made upon Article IV in its entirety as being invalid under the statutes and Constitution of Texas and the Constitution of the United States.

Sec. 45-42 of Article IV, entitled “Historic Landmark” Defined, provides that

“. . . the term ‘historic landmark’ shall mean any building, structure, site[,] district, area, or land of architectural, historical, archaeological or cultural importance or value, which the city council determines shall be protected, enhanced, and preserved in the interest of the culture, prosperity, education and general welfare of the people.”

Sec. 45^43 of Article IV, entitled Declaration of Policy, provides, in part:

“The city council hereby finds and declares as a matter of public policy that the protection, enhancement, preservation and use of historic landmarks is a public necessity and is required in the interest of the culture, prosperity, education and general welfare of the people.

Sec. 45 — 44 of Article IV, Historic Landmarks-Designation, provides in part:

“The city council may designate buildings, structures, sites, districts, areas and lands in the city as historic landmarks and define, amend and delineate the boundaries thereof . . . .”

Sec. 45 — 45 provides the criteria to be used in designations, Sec. 45-46 provides for the creation of a Historic Landmark Commission, and Sec. 45 — 47 provides for the function of such commission, a part of which function is to “recommend to the city planning commission, ordinances designating certain buildings, structures, sites, districts, areas and lands in the city as historic landmarks.”

Sec. 45 — 48 provides for action by the City Planning Commission in holding public hearings to consider any historic landmark designation ordinance after receiving a recommendation from the Landmark Commission, while Sec. 45 — 49 provides for recording of a historic landmark designation ordinance.

Sec. 45-50 of Article IV, entitled “Exteri- or alterations and changes, certificate of appropriateness; ordinary repair or maintenance; appeal,” provides in part:

“No person or entity shall construct, reconstruct, alter, change, restore, remove or demolish any exterior architectural feature of a designated historic landmark unless application be made to the landmark commission for a certificate of appropriateness and such a certificate be granted . . . ”

and further provides the procedure when a building permit is or is not required and provides for appeal to the city council by any aggrieved person.

Sec. 45-51 concerns the actions to be taken by the Landmark Commission on applications for demolition or removal of designated historic landmarks.

Sec. 45-51.1 provides:

“Sec. 45-51.1. Procedure for obtaining building permit, removal permit, demolition permit and for altering the exterior of a building or structure during pendency of consideration of such building or structure as a historic landmark or as a part of a historic landmark.
“(a) From and after the date on which the chairman, any vice-chairman or the executive secretary of the landmark commission by written order directs that any building, structure or site within the city be placed upon the agenda for any special or regular meeting of the landmark commission or any committee thereof for the purpose of considering or discussing whether or not same should be designated as a historic landmark, or from and after the date of the placement of same upon any such agenda for such purpose as evidenced by the date of such agenda or, if not dated, the date on which such agenda is posted in accordance with the provisions of Article 6252-17, V.A.T.C.S., as amended, or from and after the date that the landmark commission or any committee thereof approves or recommends a preservation plan or any amendment of any existing preservation plan which embraces or includes same building, structure, or site within the city, whichever date first occurs, no building permit allowing the construction, reconstruction, alteration, change, restoration, removal or demolition of any exterior architectural feature of any building or structure then existing included or embraced in whole or in part within the scope of such written order or such agenda or such preservation plan or such amendment thereof, as the case may be, no permit allowing the removal of all or any part of any such building or structure and no permit allowing the demolition of any part or all of any such building or structure may be issued by any official of the city, nor if no such permit is required, may any person or entity remove or demolish any part or all of any such building or structure, nor if no such permit is required, may any person or entity construct, reconstruct, alter, change, restore, remove or demolish any exterior architectural feature of any such building or structure, until the earliest of the following conditions have [sic] been met:
“(1) A final and binding certificate. of appropriateness, removal or demolition, as may be appropriate, has been issued by the landmark commission;
“(2) The landmark commission fails to recommend that some part or all of any such building or structure be designated a historic landmark or be included within a historic landmark or within a preservation plan or an amendment thereof within sixty days following the earliest of the above described dates activating this section applicable under the circumstances; or,
“(3) A final and binding decision has been made by the city council that no part of any such building or structure shall be designated a historic landmark or shall be included within any designated historic landmark. . . . ”

Sec. 45-52 provides that “The exterior of a designated historic landmark shall be maintained to insure the structural soundness of such landmark,” and further provides notice shall be given in writing of such fact, whereupon the owner “shall within ninety days of receipt of such notice, satisfy the building standards commission that reasonably necessary repairs to safeguard the structural soundness of the landmark have been effected.”

Sec. 45-53 provides that the historic landmark designation shall coexist with other use classifications and shall continue to be governed by the comprehensive zoning ordinance of the city.

The penalty provision is Sec. 45-54, which reads as follows:

“Sec. 45-54. Penalty.
“(a) It shall be unlawful to construct, reconstruct, structurally alter, remodel, renovate, restore, demolish, raze, or maintain any building, structure, or land in a historic landmark designation in violation of the provisions of this chapter, and the city in addition to other remedies, may institute any appropriate action or proceedings to prevent such unlawful construction, restoration, demolition, razing, or maintenance, to restrain, correct, or abate such violation, to prevent any illegal act, business, or maintenance in and about such premises.
“(b) Any person, firm or corporation violating any provisions of this chapter shall be guilty of a misdemeanor, and shall be deemed guilty of a separate offense for each day or portion thereof during which any violation hereof is committed, continues or is permitted, and upon conviction of any such violation shall be punishable by a fine not to exceed two hundred dollars. (Ord.No. 740307 — A, pt. 1.)”

Sec. 45-55 provides that notice, when required to be given, “if not actually delivered, shall be given by depositing the same in the United States mail, postage prepaid, addressed to the person or entity to whom such notice is to be given at his last-known mailing address. When notice is required to be given to an owner or owners of property, such notice, delivered or mailed by certified or registered mail, may be addressed to such owner or owners who have rendered their said property for city taxes as the ownership appears on the last approved city tax roll.”

No provision for compensating property owners in the event their property was zoned “H” was made by Article IV, as it appears in the record of this ease, and Highland received no compensation nor any financial aid from any revolving fund or otherwise. Minutes of the city council reveal that discussion was had, prior to enacting Article IV, as to a provision for compensating property owners whose property was zoned “H,” but there is no indication in the record that such action was ever taken.

The trial court found that compliance with Article IV may unduly increase costs of exterior hotel repairs for the zoned property, as had already occurred in connection with balcony repairs.

In their points of error Highland and its Trustee contend that the trial court erred in failing to render declaratory judgment that Article IV of the City Code is unlawful

1. because it exceeds the powers of the City under Articles 1011a-1011e, and Article 1175, Tex.Rev.Civ.Stat.Ann., and Article XI, Sec. 5, Constitution of Texas, as applied to their property and rights therein;

2. because it was an attempt to legislate by such vague, indefinite and unreasonable standards as to be arbitrary, confiscatory and a denial of due process, all under Articles I, Sec. 19 and II, Sec. 1, Texas Constitution, and the 14th Amendment, U.S. Constitution, as applied to their property and rights;

3. because it is damaging, taking, confiscation or unreasonable restraint of the property of Highland and its Trustee in violation of Article I, Secs. 17 and 19, Texas Constitution, and the 14th Amendment, U.S. Constitution, without due process and course of law and without adequate and fair compensation being made as applied to their property and rights;

4. because such article is a denial of the equal protection of the laws clause of the 14th Amendment, U.S. Constitution, as applied to their property and rights;

5. because such article is an impairment of obligation of contracts and rights in violation of Art. I, Sec. 16, Texas Constitution, and Article I, Sec. 10, Clause 1, U.S. Constitution, as applied to their property and rights;

6. The trial court erred in failing to permanently enjoin the city from enforcing or attempting to enforce Article IV, City Code, through its officers, commissions or other ordinances, as against the hotel property.

At the outset we are met with a motion by appellees to dismiss the appeal on the grounds (1) that the court should not rule on constitutional questions unless and until it becomes absolutely necessary; (2) that Highland and its Trustee are not prejudiced or aggrieved by the judgment; (3) that there is no evidence in the record that the City will attempt to rezone Highland’s property; and (4) that courts have no power to pass on hypothetical questions.

The burden is upon the party who attacks a law as unconstitutional, and the courts will not hold legislative enactments unconstitutional and invalid unless it is absolutely necessary to do so. Texas National Guard Armory Board v. McCraw, 132 Tex. 613, 126 S.W.2d 627, 634 (1939); Texas State Board of Barber Examiners v. Beaumont Barber College, Inc., 454 S.W.2d 729, 732 (Tex.1970). The courts will not anticipate constitutional questions but will decide such questions only where a present necessity exists, and then no more broadly than necessary. Bush v. State of Texas, 372 U.S. 586, 83 S.Ct. 922, 9 L.Ed.2d 958 (1963); Schauer v. Producers Wool & Mohair Co., 86 F.2d 576 (5th Cir. 1936).

It is well established that one may not complain of errors in a judgment that do not injuriously affect him or which merely affect the rights of others, and the right of appeal rests only in an aggrieved party to a lawsuit. Shell Petroleum Corp. v. Grays, 131 Tex. 515, 114 S.W.2d 869, 870 (Tex.Comm.App.1938, opinion adopted); McFarling v. Lapham, 489 S.W.2d 435, 440 (Tex.Civ.App.—Beaumont 1972, writ ref’d n. r. e.); Van’s Ballroom, Inc. v. State, 385 S.W.2d 623, 624 (Tex.Civ.App.—Austin 1964, no writ); Texas Employers Ins. Ass’n. v. Howell, 107 S.W.2d 391, 392 (Tex.Civ. App.—Dallas 1937, writ dism’d); 3 Tex. Jur.2d Rev., Appeal and Error—Civil Cases sec. 180, p. 582.

The question then arises: Who is an aggrieved party? An aggrieved person has been defined as “any person having any interest recognized by law in the subject-matter of the judgment which he considers injuriously affected by the action of the court.” Peavy v. Goss, 90 Tex. 89, 37 S.W. 317, 319 (1896); Jones v. Eastham, 36 S.W.2d 538, 542 (Tex.Civ.App.—Galveston 1931, writ ref’d).

“A party is aggrieved by a judgment or order in his favor to the extent that it fails to award him all the relief that he has demanded or to which he is entitled; to such extent he is prejudiced or aggrieved, hence entitled to appeal.” 3 Tex.Jur.2d Rev., Appeal & Error — Civil Cases sec. 181, at p. 584.

See also 2A Words and Phrases p. 638, et seq. We are of the opinion that Highland and its Trustee are aggrieved parties.

We must also decide whether there is a justiciable controversy between the parties. Art. 2524-1, Uniform Declaratory Judgments Act, Tex.Rev.Civ.Stat.Ann., provides (sec. 1) that “Courts of record shall have power to declare rights, status, and other legal relations whether or not further relief is or could be claimed. . [Sec. 2] Any person . . . whose rights, status, or other legal relations are affected by a . ., municipal ordinance . may have determined any question of construction or validity arising under the . ordinance . . . and obtain a declaration of rights, status, or other legal relations thereunder.” [Emphasis added.]

“The Uniform Declaratory Judgments Act . . . furnishes a remedy or procedure of great elasticity to facilitate or aid the courts in the construction or interpretation of the statutes on the application of adverse parties with requisite interest, and as they apply to situations presented.”

Railroad Commission v. Houston Natural Gas Corp., 186 S.W.2d 117, 122 (Tex.Civ. App. — Austin 1945, writ ref’d w. o. m.). 22 Am.Jur.2d Declaratory Judgments, Sec. 11, p. 850, states:

“Thus, it has been stated that jurisdiction exists to declare the rights, status, and other legal relations of the parties if the complainant is possessed of a judicially protectible right or status which is placed in jeopardy by the ripe or ripening seeds of an actual controversy with an adversary party, and such jurisdiction exists although the status quo between the parties has not yet been destroyed or impaired and even though no relief is or can be claimed or afforded beyond that of merely declaring the complainant’s rights so as to relieve him from a present uncertainty and insecurity.”

These rules are well established. In applying them to the instant case, we note that once appellants’ property was placed on the agenda of the Landmark Commission by the chairman, any vice-chairman, or the executive secretary of the Commission, pursuant to Section 45-51.1 of Article IV, quoted above, the restrictions of that section attached to the property. It is appellants’ primary contention that it remains subject to the rigors of that section. With this contention, we agree.

Although the City argues that Section 45-51.1 no longer applies to appellants’ property after the City Council acted to designate appellants’ property as a historic landmark, this contention is not borne out by the language of the ordinance itself. A reading of that section discloses that the restrictions provided for therein continue in force until one of three events occurs. It is indisputable that the record before us contains no indication that any one of the three events which would terminate the restrictions of Section 45-51.1 has occurred. By the very terms of the statute, therefore, the placing of appellants’ property on the agenda of the Landmark Commission in December, 1974, had the effect of applying the restrictions provided for therein to that property, and, no event terminating those restrictions having occurred, they still apply to appellants’ property.

Inasmuch as it is clear that Section 45-51.1 applies to appellants and their property, the trial court correctly assumed jurisdiction of the entire controversy as to Article IV. In its judgment, the trial court stated, “The Court finds that the controversies between the parties, as reflected in their various pleadings and on the evidence adduced, are real, bona fide, and existing, and that the controversies are justiciable and genuine in all respects.” Appellees have brought to this court no cross-point specifically challenging that finding.

In our view the pleadings of Highland and its Trustee were sufficient to establish jurisdiction under the Declaratory Judgments Act. Accordingly, appellees’ Motion to Dismiss is overruled.

Once jurisdiction of the subject matter has been established under the Declaratory Judgments Act, however, it is discretionary with the trial court whether the declaratory relief prayed for is granted. Section 6 of that Act provides, “The Court may refuse to render or enter a declaratory judgment or decree . . . [which] would not terminate the uncertainty or controversy giving rise to the proceeding.” [Emphasis added.] See Town of Santa Rosa v. Johnson, 184 S.W.2d 840, 341 (Tex. Civ.App.—San Antonio 1944, no writ); Puretex Lemon Juice, Inc. v. California Products, Inc., 324 S.W.2d 449, 453 (Tex.Civ.App.—San Antonio 1959), affirmed, 160 Tex. 586, 334 S.W.2d 780 (1960); Anderson v. McRae, 495 S.W.2d 351, 356 (Tex.Civ.App.—Texarkana 1973, no writ). “The Texas cases dealing with the propriety of the trial court granting a declaratory judgment are well settled that the court may do so where the judgment would serve a useful, beneficial purpose.” Standard Fire Insurance Co. v. Fraiman, 514 S.W.2d 343, 346 (Tex.Civ. App.—Houston [14th Dist.] 1974, no writ), and cases there cited. Here, the trial court, in its discretion, denied all declaratory relief against the whole of Article IV. Although appellants present no argument that the trial court below abused its discretion in so doing, we feel that is the next question which we must decide.

Now that the specific ordinance applying Article IV to appellants’ property has been invalidated by the court below, it is clear that Section 45-51.1 is the only portion of Article IV which has any present adverse effect on appellants or their property. Appellants, in their points of error, are careful to limit their complaints against Article IV with the words “as applied to the property and rights therein of Highland and its Trustee.” Appellants themselves contend that there is an effect of Article IV on their property only by virtue of Section 45-51.1 and the “basic policy” of Article IV, which is found in Section 45 — 43. With the exception, therefore, of the presently effective provisions of Section 45-51.1, the only potential effect of Art. IV on appellants’ or their property is the possibility or appellants’ apprehension that their property will be zoned “historical” again at a future date. We do not feel that this apprehension of a contingency makes a proper subject for declaratory relief. We do hold that with respect to Section 45-51.1, the trial court did abuse its discretion. With regard to the remainder of Article IV, we hold that there was no abuse of discretion in the trial court’s refusal to grant the requested declaratory relief. Town of Santa Rosa v. Johnson, supra; Puretex Lemon Juice, Inc. v. California Products, Inc., supra; Anderson v. McRae, supra. The fact that other issues in the general controversy between the parties remain unresolved by a declaratory judgment does not deprive the court of the power and discretion to render such a judgment. Standard Fire Insurance Co. v. Fraiman, supra. By the same token, the court has discretion to render a judgment declaring the rights of the parties only as to some of the issues raised. Also, where the trial court erroneously fails to declare the rights of the parties, it is our duty to do so. Tall Timbers Corp. v. Anderson, 370 S.W.2d 214, 217 (Tex.Civ.App.—Fort Worth 1963), reversed on other grounds, 378 S.W.2d 16 (Tex.1964).

Now that we have determined that the trial court erred in failing to declare the rights of the parties with respect to the effect of Section 45-51.1 on appellants’ property, we must determine and declare the validity of that section and the rights of the parties thereunder.

In City of Austin v. Teague, 570 S.W.2d 389 (Tex.1978), our Supreme Court spoke of a “servitude” which the City in that case had imposed upon the property of the landowner by rejecting three times his application for a waterway development permit, the City thereby seeking to preserve a scenic easement on the southern approach to the city. So here, the restrictions imposed upon appellants’ property by the placing of it on the agenda of the Landmark Commission pursuant to Section 45-51.1, amount to a servitude on appellants’ property with no provision for any compensation to be paid therefor. See also San Antonio Conservation Society, Inc. v. City of San Antonio, 455 S.W.2d 748 (Tex.1970). We hold, therefore, that there has been a “damaging” of appellants’ property for public use without adequate compensation, which is proscribed by Article 1, Section 17, of our State Constitution.

Section 45-51.1 provides generally that after the date that one of three persons, the chairman, any vice-chairman, or executive secretary of the Landmark Commission, directs by written order that any building be placed on the agenda of the Commission for consideration of its being designated as a historic landmark, the restrictions of that section apply to that property. The restrictions include the refusal to issue any building permit which would allow any change to any exterior architectural feature of the building, the removal of all or any part of the building, or the demolition of all or any part of the building. Furthermore, even where no building permit is required, no removal or demolition of all or any part of the building, or any change to any exterior architectural feature of the building may be done. These restrictions apply until the earliest of the following conditions has been met: (1) the issuance by the Landmark Commission of a certificate of appropriateness, removal, or demolition; (2) the failure by the Commission to recommend that all or part of the building be designated a historic landmark within sixty days; or (3) the decision by the City Council that no part of the building shall be designated a historic landmark.

The enactment or amendment of a zoning ordinance is a legislative act that can be performed only by the local legislative body having final authority in the matter, and that authority cannot be delegated to an administrative or advisory officer or board. 63 Tex.Jur.2d Zoning Section 21 at p. 765, and cases cited therein. Article 1011a, Tex.Rev.Civ.Stat.Ann., empowers the legislative body of cities “in the case of designated places and areas of historic and cultural importance, to regulate and restrict the construction, alteration, reconstruction, or razing of buildings and other structures.” This is not a delegable power. Although it is true that the legislative body of a city may delegate to designated public officials or boards the power to pass upon applications for building permits as a prerequisite to the erection, alteration or use of buildings, the section at issue here goes far beyond that in precluding actions with regard to buildings and other structures regardless of the need for a building permit therefor. The action by the designated public official in placing the property on the Commission’s agenda is tantamount to a temporary designation of the property as “historic”. The individual public official, therefore, has usurped the legislative authority of the City Council by placing the property on the agenda and thus causing the restrictions of Section 45-51.1 to attach to the property and its owners. Harrington v. Board of Adjustment of the City of Alamo Heights, 124 S.W.2d 401, 406 (Tex.Civ.App.—Amarillo 1939, writ ref’d); Driskell v. Board of Adjustment, 195 S.W.2d 594, 599 (Tex.Civ. App.—Fort Worth 1946, writ ref’d n. r. e.); Board of Adjustment v. Stovall, 218 S.W.2d 286, 288 (Tex.Civ.App.—Fort Worth 1949, no writ); Texas Consolidated Theaters, Inc. v. Pittillo, 204 S.W.2d 396, 398 (Tex.Civ. App.—Waco 1947, no writ). This is especially true in light of the fact that Article IV, as found in the record before us, does not purport to create historical districts or zones in the City of Austin, but rather provides for the designation of individual buildings or structures as historic.

Appellees contend that a temporary “freezing” of property in order to give the City Council time to consider it for historical zoning is a legitimate exercise of the police power, citing City of Dallas v. Crownrich, 506 S.W.2d 654 (Tex.Civ.App.—Tyler 1974, writ ref’d n. r. e.). Our opinion in Crownrich, however, is not authority for the proposition that such a temporary period may extend indefinitely. Although Section 45-51.1 provides for a sixty-day time limit after which its restrictions do not apply to property which the Landmark Commission fails to recommend be designated a historic landmark, there is no time limit on the action to be taken by the Planning Commission or the City Council. In other words, if the Landmark Commission does recommend that the property or a part of it be designated a historic landmark, the restrictions of Section 45-51.1 continue to apply until either the first or third terminating event occurs. (As a practical matter, only the third terminating event would be likely to occur.) We hold, therefore, that Section 45-51.1 is constitutionally defective in that it acts to deprive property owners of their property without due process as well as depriving them of the equal protection of the laws, because it fails to provide a reasonable time limit on final City Council action after a parcel of property has been listed on the agenda of the Landmark Commission.

Another defect in Section 45-51.1 is its complete lack of standards for guidance of the persons who may place its restrictions on landowners merely by listing their property on the Commission’s agenda. One of the primary requisites of a valid zoning ordinance is certainty. A particular zoning enactment or provision thereof may be judicially declared to be inoperative and void for uncertainty, vagueness, or indefiniteness. 63 Tex.Jur.2d Zoning Section 19, at p. 764. In the instant case, Section 45-51.1 would allow the chairman, any vice-chairman, or the executive secretary of the Landmark Commission, each at his own discretion, to place a parcel of property on the agenda of the Commission, thereby causing the restrictions of the section to attach for perhaps a minimum of sixty days. This is a power over the property of landowners in the City of Austin which must be harnessed by appropriate standards and guidelines. Texas Antiquities Committee v. Dallas County Community College District, 554 S.W.2d 924 (Tex.1977). This applies with particular force in view of the penal provisions of Section 45-54.

Accordingly, we hold that Section 45-51.1 of Article IV of the Austin City Code is unconstitutional as applied to appellants’ property here involved.

As an incidental matter, we are called upon by motion contained within appellants’ reply brief to strike a portion of Exhibit B of the appendix to appellees’ brief, the offensive portion being a copy of City of Austin Ordinance No. 760126-A which adds Section 45-56 to Article IV. The grounds for said motion are that the ordinance, dated January 26, 1978, was not in existence when this case was tried in the court below and thus is not a proper part of the record of the proceedings before that court. Appellees, in oral argument, have agreed to the motion to strike. Therefore, we hereby grant said motion and order that portion of the appendix to appellees’ brief containing a copy of Ordinance No. 760126-A stricken from the record before this Court.

In view of our disposition of this appeal, we do not find it necessary to make specific rulings on appellants’ points of error one through five. As for point of error six, inasmuch as we have declared Section 45- -51.1 to be invalid, we do not feel it necessary here and now to enjoin the City from enforcing it (or the remainder of Article IV) against the hotel property; point six is overruled.

Although the City filed a notice of appeal with regard to the dismissal of the Driskill Operating Company as a party plaintiff by the judgment below, it brings no cross-point to this court complaining of that action; thus, there is nothing before us to act upon with regard to that matter. Rules 418 and 420, T.R.C.P.; Wall v. Patton, 474 S.W.2d 22, 27 (Tex.Civ.App.—Texarkana 1971, writ ref’d n. r. e.). Appellees do bring a cross-point, however, directed to alleged error by the trial court in refusing to make additional findings of fact and conclusions of law as requested by appellees. None of the requested findings and conclusions are material to our disposition of this appeal; if there is any error, therefore, it is harmless. Rule 434, T.R.C.P. Appellees’ cross-point is overruled.

That portion of the trial court’s judgment in which he refused to render a declaratory judgment on the validity of Section 45-51.1 is reversed and judgment is here rendered that such section is invalid and void; in all other respects, the judgment of the trial court is affirmed.


author: JAMES, Justice.

text:
    A. Gail CRAWFORD, Appellant, v. HANOVER INSURANCE COMPANY, Appellee.
    No. 5983.
    Court of Civil Appeals of Texas, Waco.
    May 17, 1979.
    C. Taylor Ashworth and Charles A. Gall, Jenkens & Gilchrist, Dallas, for appellant.
    Duncan L. Clore, Strasburger & Price, Dallas, for appellee.
   OPINION

JAMES, Justice.

This is an appeal from a summary judgment in favor of Plaintiff-Appellee. We reverse and remand. The trial court granted summary judgment for $26,221.07 and costs in favor of Plaintiff-Appellee Hanover Insurance Company in an action brought by Hanover against Defendant-Appellant A. Gail Crawford seeking recovery from Crawford of an account allegedly guaranteed by Crawford.

Hanover brought this suit to collect $26,-221.07 against Crawford allegedly due and owing as a result of the furnishing of appliances to an apartment construction site in Memphis, Tennessee, which apartment complex is called, “The Way Apartments.” Neither Hanover nor Crawford were direct participants in the construction project allegedly giving rise to the debt. Hanover’s claim to the debt arises solely by virtue of an assignment of a lien in favor of Hanover, executed by General Electric Company, the alleged supplier of the appliances. On the other hand, Crawford’s sole connection with the transaction is his execution of a guaranty agreement whereby Crawford guaranteed some of the debts of Crawford-Strauss Properties, Inc., a Texas corporation, which Hanover alleges is the original debtor.

In 1969, Crawford executed a written guaranty instrument whereby he guaranteed debts of Crawford-Strauss Properties, Inc. to General Electric. To the contrary, there is summary judgment evidence to the effect that Crawford-Strauss Properties, a Texas partnership, was the general contractor of and for the construction project of the apartment complex in Memphis, Tennessee; that said partnership brought a considerable amount of appliances from General Electric for which they did not pay General Electric; that General Electric brought suit in a Tennessee court against several defendants including Crawford-Strauss Properties, a partnership, for such debts; and in addition thereto, General Electric fixed mechanic’s and materialman’s liens against the apartment complex property. In order to clear the title to the apartment complex property, the title company, to wit, Security Title Company, required that Crawford-Strauss Properties, a partnership, make a bond in the amount of $82,403.99 protecting said title company from said debts and liens; whereupon Crawford-Strauss Properties, a Texas partnership, executed such a bond to the title company by getting Hanover Insurance Company to execute same as surety thereupon. Subsequently, Hanover was obliged because of said bond to pay, and did pay to General Electric the sum of $26,221.07, and in return received from General Electric a subrogation agreement whereby Hanover was assigned all the rights, claims, and causes of action which General Electric had theretofore had and held against Crawford-Strauss Properties, Incorporated.

It was upon this subrogation and assignment agreement that Plaintiff Hanover Insurance Company based its cause of action against Defendant A. Gail Crawford, since allegedly Crawford was liable therefor upon his guaranty agreement for the debts of Crawford-Strauss Properties, Inc.

Plaintiff-Appellee Hanover moved for summary judgment, supported by affidavits, interrogatories, and documents, all of which add up to proof along the lines here-inabove summarized. The trial court after hearing granted summary judgment in favor of Plaintiff Hanover against Defendant Crawford for the principal amount sued for, from which judgment Defendant Crawford appeals, contending, among other things, that there exist genuine issues of material fact which render the summary judgment improper. We sustain Appellant’s contentions, and thereby reverse and remand the cause for trial on the merits.

The duty of the court hearing the motion for summary judgment is to determine if there are any issues of fact to be tried, and not to weigh the evidence or determine its credibility, and thus try the case on the affidavits. Rule 166-A, Tex. Rules of Civil Procedure; Gulbenkian v. Penn, (1952) 151 Tex. 412, 252 S.W.2d 929, 931. Summary judgment should be granted, and if granted, should be affirmed only if the summary judgment record establishes a right thereto as a matter of law. Gibbs v. General Motors Corp., (Tex.1970) 450 S.W.2d 827; Harrington v. Young Men’s Christian Assn. of Houston, (Tex.1970) 452 S.W.2d 423. The burden of proof is on the movant, and all doubts as to the existence of a genuine issue as to a material fact are resolved against him. In other words, the evidence must be viewed in the light most favorable to the party opposing the motion. All conflicts in the evidence are disregarded, and the evidence which tends to support the position of the party opposing the motion is accepted as true. Great American Reserve Ins. Co. v. San Antonio Plumbing Supply Co., (Tex.1965) 391 S.W.2d 41, 47. Also, see Whitten v. Metro Bank of Dallas, (Tex.Civ.App.1977) 556 S.W.2d 383, no writ.

In the case at bar, the summary judgment proof showed that Defendant-Appellant Crawford guaranteed certain debts of a corporation, whereas the debts sued upon by Plaintiff-Appellee appear to have been created by a partnership. Here we have a genuine issue of material fact, because of which the summary judgment cannot stand.

Additionally, there are other reasons why this summary judgment was improper; however, it would unduly lengthen this opinion to discuss same.

Accordingly, we reverse and remand the cause for trial on the merits.

REVERSED AND REMANDED.


author: CLAYTON, Justice.

text:
    ILLINOIS EMPLOYERS INSURANCE COMPANY OF WAUSAU and Employers Mutual Liability Insurance Company of Wisconsin, Appellants, v. Shorty Ray LEWIS, Appellee.
    No. 8263.
    Court of Civil Appeals of Texas, Beaumont.
    May 17, 1979.
    Rehearing Denied May 31, 1979.

      Mark T. Price, Houston, for appellants.
    Joe H. Tonahill, Jasper, for appellee.
   CLAYTON, Justice.

Plaintiff filed this suit in the court below seeking to set aside an award for worker’s compensation by the Industrial Accident Board. Defendants, Illinois Employers Insurance Company of Wausau and Employers Mutual Liability Insurance Company of Wisconsin, appeal from a default judgment entered by the trial court pursuant to Tex. R.Civ.P. 168 and 215a(c) awarding plaintiff compensation in the sum of $31,477.44 plus $3,696.90 in medical benefits.

Defendants’ first five points of error complain of the trial court’s action in granting plaintiff’s motion to strike defendants’ pleadings because of the failure to answer plaintiff’s written interrogatories.

Plaintiff filed his petition on June 6, 1978. Defendants (by counsel other than counsel representing defendants at time of rendition of judgment) filed their original answer on July 1, 1978. On July 7, 1978, plaintiff filed his Request for Admissions of Fact and his written interrogatories in the District Clerk’s office. Defendants’ answer to the Request for Admissions was filed July 17, 1978. The written interrogatories were not served upon defendants’ counsel until July 14, 1978. Pursuant to Tex.R. Civ.P. 168, the answers to such interrogatories were not due to be filed until August 14, 1978. On August 4th, ten days before the due date for filing answers to the interrogatories, the court set the case for trial for August 29th. On August 16th, the District Clerk sent a letter to defendants’ counsel stating the attorney for plaintiff had requested this case be placed on the non-jury docket for August 29 and stating further that plaintiff’s counsel advised he would be ready for trial at that time. Plaintiff had previously asked for a jury trial and had paid a jury fee. On August 21, defendants forwarded to the District Clerk the proper jury fee deposit.

On August 21, plaintiff filed his reply to defendants’ motion for continuance wherein he stated, “the plaintiff has submitted Interrogatories to the defendant[s]. . These should be answered by the defendant[s] in ample time prior to the trial date of August 29th.” This statement was made seven days after the due date for filing such answers. No complaint for late filing was made at this time.

On August 28, defendants filed their motion in opposition to the withdrawal of the case from the jury docket. Plaintiff’s motion for sanctions pursuant to Tex.R.Civ.P. 168 and 215a, was filed on August 28th, one day prior to the trial date. On August 29th, plaintiff and his counsel and defendants’ counsel appeared before the court, and plaintiff presented and urged his motion for sanctions. The statement of facts contains no testimony from any witness on this day. It reflects only discussions and statements of counsel. At this hearing, defendants’ counsel stated that the interrogatories “were served upon Mr. Willard Tinsley, who was the attorney of record for the defendants on August 14, 1978. . . . Upon it being called to my attention they had not been answered . . . Mr. Tinsley is out of the country, has been for some time. . I immediately set forth my own investigative efforts in order to get the information necessary to prepare answers to written interrogatories.” The court did not rule upon the motion at that time but reset it for Friday of that week (September 1).

Defendants filed their answers to the written interrogatories approximately fifteen minutes before the court resumed the hearing on September 1. When the hearing was resumed, plaintiff offered in evidence the written interrogatories, plaintiff’s request for admissions and defendants’ answers thereto, medical records of Buna Medical Center, plaintiff’s deposition, plaintiff’s petition, and plaintiff’s answers to defendants’ written interrogatories, and then requested the court to grant the motion for sanctions. Defendants then called to the attention of the court that defendants’ answer to the interrogatories had been filed. The court granted the motion for sanctions, ordered that defendants’ answer be stricken and default judgment “will be entered for the plaintiff. The amount of default judgment will be taken under advisement by the court until such time as the court has had opportunity to read the deposition and the other instruments.” Whereupon defendants excepted to the ruling and demanded a trial by jury on the “damage issue, at least the compensation.” This request was denied.

We believe it is significant to point out that the defendants’ answer to plaintiff’s request for admissions of facts admitted that plaintiff was an employee of McDonald Lumber Company on January 2, 1978; that he was accidentally injured while working for such employer on said date, while in the course of his employment; that his employer and defendants had actual notice of such accidental injury within thirty days from .date of injury; that notice of injury and claim for compensation was duly and timely filed with the Industrial Accident Board; that if such notices were not timely filed good cause existed for failure to so file and that all conditions precedent to the acquisition of jurisdiction of the court had been fully complied with by the plaintiff. Defendants further admitted all requests necessary to the establishment of plaintiff’s wage rate. These admissions, and others, contained in the request, covered the same subject matter as those inquired about in the written interrogatories. In view of these admissions, plaintiff was in a position to proceed to trial with only the burden of proving the extent and duration of his injuries.

Tex.R.Civ.P. 168 provides:

“If a party, except for good cause shown, fails to serve answers to interrogatories . . . the court may, on motion and notice, make such orders as are just, including those authorized by paragraph (c) of Rule 215a.”

Tex.R.Civ.P. 215a(c) provides for the imposition of penalties including striking of the pleadings, depriving a party of his grounds for relief or his defense or enter a judgment by default, or make such other order with respect thereto as may be just.

Tex.R.Civ.P. 168 and 215a are designed to give the trial court an expeditious procedure for insuring the effectiveness of pretrial discovery. The authorized sanctions are not intended to be arbitrary and exclusive, but flexible and plural, vesting in the trial court broad discretion to fashion a remedy which will secure compliance with its orders and deter future non-compliance. Dow Chemical Co. v. Benton, 163 Tex. 477, 357 S.W.2d 565 (1962); Firestone Photographs, Inc. v. Lamaster, 567 S.W.2d 273 (Tex.Civ.App.—Texarkana 1978, no writ); Plodzik v. Owens-Corning Fiberglas Corp., 549 S.W.2d 52 (Tex.Civ.App.—Austin 1977, no writ); Pena v. Williams, 547 S.W.2d 671 (Tex.Civ.App.—San Antonio 1977, no writ).

The office of sanctions is to secure compliance with the discovery rules, not to punish erring parties. Ebeling v. Gawlik, 487 S.W.2d 187 (Tex.Civ.App.—Houston [1st Dist.] 1972, no writ); Robison v. Transamerica Insurance Co., 368 F.2d 37 (10th Cir. 1966).

The choice of the appropriate sanctions is for the trial court rather than the appellate court, and, as long as such sanctions are within the authority vested in the trial court, they will not be overturned unless they constitute a clear abuse of discretion. U. S. Leasing Corp. v. O’Neill, Price, Anderson & Fouchard, Inc., 553 S.W.2d 11 (Tex.Civ.App.—Houston [14th Dist.] 1977, no writ).

The application of the sanction of depriving a party of the right to present his grounds for relief or his defense, thereby subjecting him to the rendition of a default judgment against him, is a harsh remedy, and the court’s action in refusing to apply such sanctions will stand in the absence of a showing of abuse of discretion. Hankins v. Haffa, 469 S.W.2d 733, 738 (Tex.Civ.App.—Amarillo 1971, no writ).

Under the facts stated above, the action of the trial court in granting plaintiff’s motion for sanctions, wherein it was ordered that defendants’ answer be stricken and default judgment entered against them, was clearly an abuse of its discretion. Moreover, the granting of such sanctions has been held to be a clear abuse of discretion when the answers to the interrogatories were on file with the court at the time the sanctions were imposed. Young Companies, Inc. v. Bayou Corp., 545 S.W.2d 901 (Tex.Civ.App.—Beaumont 1977, no writ).

We have found no cases, and none have been cited, authorizing a trial court to strike a defendant’s pleadings and enter a default judgment for the plaintiff for the failure to answer interrogatories in the absence of a refusal to comply with an order of the court compelling the filing of such answers.

In every case cited by the parties in their briefs, wherein such sanctions have been upheld, there had been a previous order entered by the court compelling the defaulting party to comply with the discovery rules. See Henson v. Citizens Bank of Irving, 549 S.W.2d 446 (Tex.Civ.App.—Eastland 1977, no writ); Rainwater v. Haddox, 544 S.W.2d 729, 731 (Tex.Civ.App.—Amarillo 1976, no writ); Pena v. Williams, supra; Plodzik v. Owens-Corning Fiberglas Corp., supra; Eberling v. Gawlik, supra; U. S. Leasing Corp. v. O’Neill, Price, Anderson & Fouchard, Inc., supra; Hankins v. Haffa, supra; Young Companies, Inc. v. Bayou Corp., supra.

Tex.R.Civ.P. 168 and the sanctions authorized by Tex.R.Civ.P. 215a(c) do not literally require a party to obtain an order compelling answers to interrogatories before moving for sanctions against an adverse party. However, in view of the harsh penalties provided in Rule 215a(c) we hold that it is incumbent upon a party to file a motion to compel answers to interrogatories, to obtain a court order thereon and to show a refusal or failure to comply with such court order before a court is authorized to grant a motion for sanctions and impose the specific penalties authorized by Rule 215a(c).

Defendants next complain of the trial court’s action in refusing them a trial by jury on the issue of damages. As previously stated, the plaintiff had demanded a jury and paid the required jury fee. At plaintiff’s request the case was removed from the jury docket and placed on the non-jury docket. Upon being so informed, defendants paid a jury fee and objected to the withdrawal from the jury docket and requested a jury trial on the issue of damages or compensation.

Tex.R.Civ.P. 220 provides that, when a party has paid the fee for a jury trial, he shall not be permitted to withdraw the cause from the jury docket over the objection of the parties adversely affected. Defendants objected to the withdrawal from the jury docket and paid a jury fee after notice of such withdrawal. They objected to such procedure at the time of trial and demanded a jury on the trial of the issue of damages. Under these circumstances, the court was not authorized to remove the cause from the jury docket. Rainwater v. Haddox, supra; White Motor Co. v. Loden, 373 S.W.2d 863, 865 (Tex.Civ.App.—Dallas 1963, no writ). Moreover, Tex.R.Civ.P. 243 provides that “if the cause of action is unliquidated or be not proved by an instrument in writing, the court shall hear evidence as to damages and shall render judgment therefor, unless the defendant shall demand and be entitled to a trial by jury . .” (Emphasis supplied.)

The judgment by default did not dispense with the necessity for evidence of plaintiff’s unliquidated damages. Tex.R. Civ.P. 243; Morgan Express, Inc. v. Elizabeth-Perkins, Inc., 525 S.W.2d 312, 314 (Tex. Civ.App.—Dallas 1975, writ ref’d); Rainwater v. Haddox, supra. Upon an inquiry into the amount of unliquidated damages after a default judgment, the defendant has the right to be present, to interpose objections to testimony offered by plaintiff’s witnesses and to cross-examine them in order that, by the exclusion of improper evidence, a proper judgment may be rendered on competent and sufficient evidence. Rainwater v. Haddox, supra; Maywald Trailer Co. v. Perry, 238 S.W.2d 826 (Tex.Civ.App.—Galveston 1951, writ ref’d n. r. e.).

Under the provisions of Tex.R.Civ.P. 220 and 243, defendants’ having objected to plaintiff’s withdrawal of the case from the jury docket, and demanded a jury and paid the jury fee, the court was not authorized to deny defendants a jury trial on the issue of damages. This point is sustained.

In view of our disposition of this appeal, we deem it unnecessary to discuss the other points of error urged by defendants.

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

REVERSED and REMANDED.


author: KEITH, Justice.

text:
    Bill PERSON et al., Appellants, v. Charles G. LATHAM, Appellee.
    No. 8176.
    Court of Civil Appeals of Texas, Beaumont.
    May 17, 1979.
    Rehearing Denied June 7, 1979.

      St. John Garwood, Jr., Houston, for appellants.
    Charles A. Moore, Dwight E. Yorpahl, Houston, for appellee.
   KEITH, Justice.

Plaintiffs below appeal from a judgment which did not grant them the relief to which they claim to be entitled to receive under the pleadings, evidence, and findings of the jury. Their claims arose out of alleged fraudulent misrepresentations relating to the sale of several lots in two subdivisions. The appeal is upon six points of error raising both factual and legal questions which we must discuss. However, we will condense, as much as possible, the tremendous record presented.

Two brothers, Bill Person and Claude Person, brought suit against several defendants claiming that a salesman for the owners and developers, C. G. Latham, made false and fraudulent representations to induce them to purchase lots in two subdivisions in Montgomery County. We quote in the margin plaintiffs’ pleadings describing a part of the scheme used.

Our record shows, conclusively, that the defendant Latham, by means of false and fraudulent representations, persuaded the plaintiffs, Bill and Claude Person, to invest in certain lots on Lake Conroe, and the jury so found. Bill Person secured a judgment for his damages as found by the jury, in the amount of $19,000 plus $20,000 in exemplary damages. Because of a plea of res judi-cata, to be discussed hereinafter, Claude Person was denied a recovery.

As to Bill Person, the question presented is whether his recovery of actual damages should be trebled under the provisions of the Defective Trade Practices-Consumer Protection Act, Tex.Bus. & Comm.Code Ann. §§ 17.41, et seq. (Supp.1978-79), specifically § 17.45(1) and (2 and, if so, may he recover exemplary damages in addition to the mandatory trebling of the damages under the Act. We overrule the contentions so advanced for the reasons now to be stated.

It is clear from the reading of the record that Bill Person was a willing and gullible victim of Latham’s false representations. He agreed to purchase his lots on the representation that a “Mrs. Gigglia” would pay double his cost before any monthly installments matured. Of course, there was no “Mrs. Gigglia” and the jury so found. It fixed Bill’s damages at the amount of the profit he would have realized had there been a Mrs. Gigglia and she had performed as Latham had promised. Bill’s argument is to the effect that when he purchased the lots under these circumstances, he purchased Latham’s services in selling the lots to Mrs. Gigglia. In so doing, he overlooks the limitation upon the definition of “goods” as defined in the statute. Under Bill’s own testimony, he did not purchase such lots for use, but to become a link in a chain designed to fleece the mythical Mrs. Gigglia of her funds.

Texas follows the rule that statutes in derogation of the common law are not strictly construed; but, if the statute creates a liability unknown to the common law, or deprives a person of a common law right, the statute will not be extended beyond its plain meaning or applied to cases not clearly within its purview. And, since the legislature did not specifically define the word “use”, its ordinary meaning will be applied. Satterfield v. Satterfield, 448 S.W.2d 456, 459 (Tex.1969).

Under the clear rules enunciated in Satterfield, supra, we decline to permit one conspirator to recover treble damages against his co-conspirator in a scheme to defraud a- third person. Instead, we will apply the usual rules to the present prevailing facts.

Section 2.01 of the Code Construction Act, Tex.Rev.Civ.Stat.Ann. art. 5429b — 2 (Supp.1978-79), is in accord with the rule enunciated in Satterfield, supra. We turn now to a few of the authorities defining the word “use”.

In Southwestern Telegraph & Tel. Co. v. City of Dallas, 174 S.W. 636, 641 (Tex.Civ. App.—Dallas 1915, writ ref’d), the court said: “ ‘Use’ means to make use of; to convert to one’s own service; to put to a purpose; to hold, occupy, enjoy, or take the benefit of.” In a more recent case of solid precedential value, James Stewart & Co. v. Mobley, 282 S.W.2d 290, 294 (Tex.Civ.App.—Dallas 1955, writ ref’d), the court said: “ ‘Use’ is to employ for accomplishment of a purpose; to apply to one’s services; to avail oneself of.”

Black’s Law Dictionary (Rev. 4th Ed., 1968) says that in the non-technical sense, the “‘use’ of a thing.means that one is to enjoy, hold, occupy, or have some manner of benefit thereof.” It also means “usefulness, utility, advantage, productive of benefit.”

The word was defined by then Chief Justice Barrow, in Beggs v. Texas Dep’t. of Mental Health & Mental Ret, 496 S.W.2d 252, 254 (Tex.Civ.App.—San Antonio 1973, writ ref’d), as follows: “ ‘to put or bring into action or service; to employ for or apply to a given purpose.’ ”

The jury found in Bill Person’s favor each of the constituent elements of a cause of action under Tex.Bus. & Comm.Code Ann. § 27.01 (1968), and the jury found that the lots he purchased were worth $19,000 but that if Latham had performed as he represented, they would have been worth $38,-000, so his judgment was for $19,000 plus exemplary damages in the sum of $20,000. Thus, we review a judgment wherein there has been a recovery under a special statute governing transactions involving real estate sold under false representations.

We note in passing that § 27.01 is derived from Tex.Rev.Civ.Stat.Ann. art. 4004 (1966), which for nearly a half century governed suits involving fraudulent representations with regard to land transactions and in stock of corporations. It is significant that the new Act, § 17.45(1), specifically excludes fraudulent representations as to stock in corporations: “ ‘Goods’ means tangible chattels. . . . ”

Moreover, the legislature did not indicate any intention to repeal or to modify the statute presently found in § 27.01. We have a special statute governing corporate stock and real estate and we find no imperative need to torture this case into one covered by the Deceptive Trade Practices Act.

Bill Person pleaded and proved a cause of action under § 27.01. See and compare, Stanfield v. O’Boyle, 462 S.W.2d 270, 271 (Tex.1971). We affirm his judgment on that cause of action against Latham. In so doing, we overrule and deny his claims to a recovery under § 17.45.

Claude Person was a rancher in Jack County and had no prior experience in buying or selling lots in real estate subdivisions. His brother Bill talked to him about buying some property in Montgomery County. Bill told him that “a lady was, was in the process of buying them, that she wanted them [the lots] to build a beautiful lake home.” He, too, was gullible and frankly testified that he purchased a lot so “[t]hat I could resell it and make some money.”

He and his wife drove to Lake Conroe and met Latham who showed them the lot that Latham represented as being the one “Mrs. Gigglia” needed to round out her lakefront property acquisition. Latham told them “that Clydean [Mrs. Claude Person] and I would make about five, would make $5,000 off that one particular lot.” Subsequently, Latham told him that one “Roy James” was interested in purchasing two other lots for $20,000 each but that Claude could purchase them for $10,000 each. With the glint of large and quick profit, Claude purchased his lots. He soon found out that there was no substance to Latham’s representations.

Claude Person filed his suit against the defendants in Montgomery County on October 31, 1975, and, eventually, his suit was consolidated with that of Bill which had been filed several weeks earlier. While Claude’s suit was pending in Montgomery County, he and another brother (Richard) filed a suit in Jack County on April 7, 1976, naming Latham as a party defendant. Claude specifically sought a recovery of $4,900 for money he had paid to Latham on the Montgomery County lots forming the basis of this suit then pending in that county-

Latham defaulted on the Jack County litigation and Claude, along with his wife and other brother as plaintiffs in Jack County, recovered judgment against La-tham for $20,125, the judgment having been signed on June 19, 1976, based upon testimony heard by the trial court on May 27, 1976.

Latham learned of the default judgment and timely filed his original motion for new trial and it was timely amended on July 21. The parties agreed in writing filed with the court on August 17, that the amended motion would be argued on September 9 and acted upon within twenty days thereafter. See Tex.R.Civ.P. 329b, §3.

No order was entered on September 29 so that the motion was overruled by operation of law upon that date. Sanders v. West Texas Utilities Co., 537 S.W.2d 787, 788 (Tex.Civ.App.—Eastland 1976, writ ref’d). Notwithstanding this effect of the non-action on the part of the trial court, it still had jurisdiction over its judgment for an additional thirty days during which time it could have entered an order vacating, modifying, correcting, or reforming such judgment. Transamerican Leasing Co. v. Three Bears, Inc., 567 S.W.2d 799, 800 (Tex.1978); Mathes v. Kelton, 569 S.W.2d 876, 878 (Tex. 1978). No such action was taken by the trial court during that period.

Instead, within thirty days after September 29, counsel for the Jack County plaintiffs (Claude, et al.) filed an instrument among the papers entitled “Notice of Abandonment”. In this instrument, counsel purported to act for all of the plaintiffs declaring “that they hereby abandon and forego those damages alleged in Paragraph I of Plaintiffs’ First Original Petition.” The noticed paragraph was one seeking $4,900 for money had and received by Latham on the lots purchased by Claude!

In filing this “abandonment”, counsel recited that it was done pursuant to Tex.R. Civ.P. 165 and the “notice” contained this additional language:

“Plaintiffs hereby stipulate that the Judgment in this cause should be adjusted and credited with the figure of $4,900.00 for this purpose.”

In April, 1977, the Sheriff sold several items of personal property under Claude’s Jack County judgment for the sum of $95.00 — the precise amount of the court costs. The effect of these maneuvers, if upheld in this court, is to permit Claude, et al., to litigate and recover a judgment for more than $20,000 in Jack County and to reserve Claude’s claim for further litigation in Montgomery County. We decline to permit this result.

Reduced to its simplest form, Claude’s position is that he was entitled to take a partial non-suit after he had secured a judgment upon his claim, thus enabling him to litigate the same claim elsewhere again. We have found no authority permitting such action or supporting such contention. Rule 165 permits an abandonment of a part of a claim or defense before but not after trial of the cause and entry of the judgment. We decline to apply Rule 165 to a case wherein judgment was rendered on a claim before the motion to abandon was filed.

Under the record which we have reviewed, the action of the trial court in sustaining the plea of res judicata was proper and all points attacking such action are overruled. Freeman v. McAninch, 87 Tex. 132, 27 S.W. 97 (1894). See also Z. Steakley and W. Howell, Jr., “Ruminations on Res Judicata”, 28 S.W.L.J. 355, 363, et seq. (1974), where most of the modern authorities are cited and discussed.

Finding no error, the judgment of the trial court is affirmed.

      . The transcript contains more than five hundred pages; the statement of facts takes up more than eighteen hundred pages; and, there are more than one hundred fifty original exhibits. To compound the difficulties encountered in a record of such magnitude, appellee has not favored us with a brief answering any of the contentions brought forward.

      . “The scheme and the plain, design and conspiracy also was for the purpose (among others) of tricking Plaintiffs, as buyers who did not want to purchase lots for themselves, into thinking they could resell the lots for a profit, and then covering up Defendants’ frauds by various artifices and other dishonest maneuvers. . . . Essentially, these cover-up schemes involved at least two methods of operation. One method was to ask Plaintiffs to answer a questionnaire after a sale was completed, which asked if misrepresentations had been made. However, in each case Defendants knew (or should have known) that Plaintiffs had been fraudulently induced by Defendant, Latham, to answer that nothing had been misrepresented. Another method was to snare Plaintiffs, as buyers, into helping Defendant Latham locate still other buyers for a ‘referral fee’, and then later falsely claim that the ‘referral fee’ was improperly paid. Then, when Plaintiffs later complained that their lots hadn’t been resold, these phony defenses (and others just as phony) would be thrown in their faces by Wilkerson and Bailey [two other defendants].”

      . Subsequent to the entry of the judgment below, plaintiffs settled their controversies with all defendants except Latham who is our sole appellee; and, he has not favored us with a brief.

      . § 17.45(1) of the amended Act reads:
      “ ‘Goods’ means tangible chattels or real property purchased or leased for use.”

        § 17.45(2) of the amended Act reads:
      “ ‘Services’ means work, labor, or service purchased or leased for use, including services furnished in connection with the sale or repair of goods.” (emphasis supplied)

      . Art. 5429b-2, § 2.01 reads in part: “Words and phrases shall be read in context and construed according to the rules of grammar and common usage.”

      . Rule 165: “A party who abandons any part of his claim or defense, as contained in the pleadings, may have that fact entered of record, so as to show that the matters therein were not tried.”

      . Plaintiffs had alleged that the equipment, including a “new Massey Ferguson tractor— model 235 diesel . . . .” was worth in excess of $15,000.


author: DIES, Chief Justice.

text:
    Mrs. Jimmy Lee BRATTON Individually and as Community Survivor of Jimmy Lee Bratton, Deceased, Appellant, v. Martha ALEXANDER, Appellee.
    No. 8254.
    Court of Civil Appeals of Texas, Beaumont.
    May 17, 1979.
    Ralph M. Zeleskey and Paul A. Clark, Lufkin, for appellant.
    C. B. Stanley, Houston, for appellee.
   DIES, Chief Justice.

On August 4, 1976, in a two-vehicle collision in Montgomery County, Jimmy Lee Bratton was killed, and Martha Alexander was injured. The latter, as plaintiff below, sued Bratton’s wife as Community Survivor in Montgomery County, defendant below. Defendant filed a plea of privilege to remove the cause to Angelina County, which was overruled, and from which defendant brings this appeal.

Plaintiff’s suit was filed in Montgomery County on November 8,1976. At that time, Section 9a of Tex. Rev.Civ.Stat.Ann. art. 1995 (Vernon 1964), provided: Defendant urges that the existence of the marital relationship does not make the husband the wife’s agent within the purview of this statute, citing Taylor v. Martin, 386 S.W.2d 211 (Tex.Civ.App.—Waco 1965, writ dis’m).

“9a. Negligence — a suit based upon negligence . . . may be brought in the county where the act or omission of negligence occurred or in the county where the defendant has his domicile. The venue facts necessary for plaintiff to establish ... to sustain venue in a county other than the county of defendant’s residence are:
“1. That an act or omission of negligence occurred in the county where suit was filed.
“2. That such act or omission was that of the defendant, in person, or that of his servant, agent or representative acting within the scope of his employment.
“3. That such negligence was a proximate cause of plaintiff’s injuries.”

Plaintiff counters that effective August 29, 1977 (before this plea of privilege was heard), Subdivision 2 (Vernon Supp. 1978) was amended as follows:

“That such act or omission was that of the tort-feasor, in person, or that of his servant, agent or representative acting within the scope of his employment, or that of the person whose estate the defendant represents as executor, administrator or guardian.”

We deem it unnecessary to decide whether the previous (Vernon 1964) or the amended Section 9a of Tex.Rev.Civ.Stat. Ann. art. 1995 (Vernon Supp. 1978) applies. For assuming, arguendo, as plaintiff urges that 9a as amended is applicable, defendant must be shown as “. . . the person whose estate the defendant represents as executor, administrator, or guardian.” We have been cited to no case, nor have we independently found one, construing this language. But clearly, we think, this requires “qualification” in court by the defendant.- Here the defendant is the widow of the deceased driver and has not been appointed or qualified judicially in any manner required by the amended section. For this reason we hold it was error for the trial court to overrule the plea of privilege, reverse said order, and order that this cause be transferred to one of the District Courts of Angelina County.

REVERSED and REMANDED with instructions.

KEITH, J., concurs in the reversal of the trial court’s judgment.


text:
    C. Bruce STRATTON, Appellant, v. COUNTY OF LIBERTY, Appellee.
    No. 8268.
    Court of Civil Appeals of Texas, Beaumont.
    May 17, 1979.
    Rehearing Denied June 7, 1979.

      C. Bruce Stratton, Liberty, for appellant.
    J. C. Zbranek, Liberty, for appellee.
   KEITH, Justice.

Plaintiff below appeals from a take nothing judgment entered in a bench trial of a suit based upon quantum meruit and an implied contract of employment.

In April 1973, the holdover grand jury of Liberty County, Texas, began an investigation into the affairs of Artesia Hall, a school for problem children located in Liberty County. Shortly after beginning the investigation, the grand jury foreman and other members of the grand jury determined that they needed the assistance of a special attorney to help in their investigation. The authority to employ an attorney and obligate the county to pay for his services was discussed with the district attorney, county attorney, and district judge. No firm decision was made on this issue, but the grand jury employed plaintiff to help in their investigation and he began working on April 29, 1973. The County Judge and the Commissioners’ Court of Liberty County were not consulted prior to plaintiff’s employment.

On May 14, 1973, the grand jury foreman and secretary appeared before the Commissioners’ Court requesting authority to employ plaintiff as a special investigator for the grand jury. The court formally authorized the employment of plaintiff as a special investigator to the grand jury under the supervision of the district and county attorneys for a period not to exceed twenty days at fifty dollars per day. Plaintiff submitted a bill and was paid accordingly. However, plaintiff continued to render services after his formal employment during a period of seven weeks, without the knowledge of the Commissioners’ Court.

On July 9, 1973, plaintiff submitted a statement to the Commissioners’ Court for his services, and the court refused to pay him, contending that his employment was illegal. Plaintiff then filed suit against Liberty County based upon quantum meruit and an implied contract of employment seeking $14,945.00 as attorney fees (427 hours at $35 per hour), $370.29 as expenses incurred by plaintiff, and $2,100.00 as expenses advanced to two private investigators.

In its original answer, County set forth a general denial and specifically denied that it ratified the employment of plaintiff by the grand jury, county attorney, or district attorney. In addition, it specifically denied that it accepted or received any benefits for the services rendered by plaintiff and if such services were actually rendered, they were for the benefit of the grand jury and the State of Texas. County further alleged that the matters under investigation by the grand jury were not county business, that County did not have a lawful interest in such an investigation, and that it was without authority to enter into a contract to pay for a special investigator to assist the grand jury and any such contract would be void. County further alleged that the services of plaintiff were on a voluntary basis without the knowledge or consent of County. The court rendered a take nothing judgment, from which plaintiff has perfected this appeal.

To establish a right of recovery on the basis of quantum meruit, one must first show that the recovery sought is not the subject of an enforcible contract. Black Lake Pipe Line Co. v. Union Constr. Co., 538 S.W.2d 80, 86 (Tex.1976); Woodard v. Southwest States, Inc., 384 S.W.2d 674, 675 (Tex.1964). One must also show that the services rendered were knowingly accepted by the one for whom they were performed under such circumstances that the recipient should reasonably have expected to be charged for them. The claimant must further show that the services resulted in a benefit to the one to be charged and, since the measure of the recovery is the value of that benefit, the claimant must show the amount of such value. Black Lake Pipe Line Co. v. Union Constr. Co., supra; Davidson v. Clearman, 391 S.W.2d 48, 50 (Tex.1965); Montes v. Naismith and Trevino Constr. Co., 459 S.W.2d 691, 694 (Tex. Civ.App.—Corpus Christi 1970, writ ref’d n. r. e.); Electric Wire & Cable Co. v. Ray, 456 S.W.2d 260, 262 (Tex.Civ.App.—Houston [14th Dist.] 1970, writ ref’d n. r. e.).

Plaintiff appeals with a variety of legal and factual sufficiency points complaining that the court erred in failing to render judgment for plaintiff. His points are briefed together; there is no separate statement or argument under any one of them. He contends, inter alia, that the evidence shows that County did accept plaintiff’s services and retain benefits thereof, plaintiff’s employment was not illegal or unauthorized, plaintiff’s employment was sanctioned by authorized County representatives, and County was liable for the reasonable value or stated value of the services rendered and expenses incurred by plaintiff.

It has long been well established in Texas that even individual members of the Commissioners’ Court have no authority to bind the county by their separate action and that only action taken by the governing body — the Commissioners’ Court acting as an official body — can bind the county.. Canales v. Laughlin, 147 Tex. 169, 214 S.W.2d 451, 455 (1948); Gano v. Palo Pinto County, 71 Tex. 99, 8 S.W. 634, 635 (1888). See also Eastex Wildlife Conservation Ass’n v. Jasper, et al, 450 S.W.2d 904, 907 (Tex.Civ. App.—Beaumont 1970, writ ref’d n. r. e.); Hill Farm, Inc. v. Hill County, 425 S.W.2d 414, 418 (Tex.Civ.App.—Waco 1968), aff’d, 436 S.W.2d 320 (Tex.1969).

The court in Wilson v. County of Calhoun, 489 S.W.2d 393, 397 (Tex.Civ.App.—Corpus Christi 1972, writ ref’d n. r. e.), summarized the authority of the Commissioners’ Court as follows:

“The authority of the Commissioners’ Court as the governing body of the county to make contracts in behalf of the county is limited to that conferred either expressly or by necessary implication by the Constitution and laws of this State. Childress County v. State, 127 Tex. 343, 92 S.W.2d 1011, 1016 (1936). A contract made by a county is valid and binding only if made under the authority of a resolution or order duly passed at a meeting of the Commissioners’ Court and entered in the minutes. Morrison v. Kohler, 207 S.W.2d 951 (Tex.Civ.App.—Beaumont 1947, writ ref’d n. r. e.); 15 Tex.Jur.2d Counties, §§ 92, 93, pp. 317-320. That which the Commissioners’ Court could authorize in the first instance could be ratified by it at a subsequent date. Cameron County v. Fox, 61 S.W.2d 483, 487 (Tex. Com.App., 1933); Angelina County v. Kent, 374 S.W.2d 313 (Tex.Civ.App.—Beaumont 1963, n. w. h.)”

Plaintiff was hired by the grand jury, district attorney, and county attorney, not the Commissioners’ Court. The court’s minutes reveal that plaintiff was hired by County for only twenty days at fifty dollars per day. There is no evidence that it contracted for any longer period of time. Several members of the court testified that they were unaware that plaintiff worked longer than that time period until they received a statement from him.

Plaintiff was charged with notice of the limitation upon the County’s liability for services rendered by virtue of the constitution and laws of the state regulating Commissioners’ Courts. City of Beaumont v. Moore, 146 Tex. 46, 202 S.W.2d 448, 452 (1947); City of San Antonio v. Guido Bros. Constr. Co., 460 S.W.2d 155, 164 (Tex.Civ. App.—Beaumont 1970, writ ref’d n. r. e.). No authority to incur indebtedness for services rendered has been conferred upon the grand jury.

Plaintiff relies on the case of Rodgers v. County of Taylor, 368 S.W.2d 794 (Tex.Civ.App.—Eastland 1963, writ ref’d n. r. e.). We do not find this case to be applicable. In Rodgers, the district attorney, county judge, one commissioner, and the grand jury foreman hired a court reporter to transcribe some testimony and later the Commissioners’ Court ratified this expense. A taxpaying citizen contested this expense contending that the court had no authority to pay it. The appellate court held that the county was liable by express contract because the court ratified the expense, or, alternatively, by implied contract because the court received the court reporter’s benefits under a contract even though the contract was illegal, i. e., not in compliance with the constitution or statute of the state. See Harris County v. Emmite, 554 S.W.2d 203, 204 (Tex.Civ.App.—Houston [1st Dist.] 1977, writ dism’d), and cases therein cited. In the case before us, the Commissioners’ Court did not ratify plaintiff’s expenses and has always contended that it was not liable for more than the initial twenty-day period at fifty dollars per day.

Finding no error, we affirm the judgment of the trial court.

AFFIRMED.


author: PEDEN, Justice.

text:
    LIBERTY LEASING COMPANY, INC., Appellant, v. Jess F. STILL, Sr., Appellee.
    No. 17407.
    Court of Civil Appeals of Texas, Houston (1st Dist.).
    May 24, 1979.

      Wendell S. Loomis, Houston, for appellant.
    James R. Cornish, Houston, for appellee.
   PEDEN, Justice.

Liberty Leasing Co., Inc., appeals from a take-nothing judgment in a suit based on a foreign judgment. The court, sitting without a jury, found that Mr. Jess Still was denied due process of law, so the Illinois judgment rendered against him was not entitled to full faith and credit. Findings of fact and conclusions of law were filed. Liberty Leasing alleges that a previous decision of the Waco Court of Civil Appeals in this case constitutes the law of the case, so the findings of the trial court and its judgment in this case should have been determined in keeping with that appeals court decision. Further, that the Illinois court had valid jurisdiction, and Liberty Leasing was entitled to recover $8,000 plus costs.

A Texas corporation named Stillco entered into an agreement to lease heavy construction equipment from Liberty Leasing, an Illinois corporation. The lease agreement designated Liberty Leasing Co., Inc., as lessor and Stillco, as lessee. Underneath this area were three boxes labelled “Corporation,” “Partnership,” and “Proprietorship” with instructions to “Check One; ” the “Corporation” box was checked. At the bottom of lease, Stillco’s name was again listed as lessee and the contract signed by Jess F. Still as president. His signature appears a second time immediately following his first signature. This time, however, in the “Title” space, the word “Individual” was typed in. There is yet another space labelled “Personally as an Individual” that was left blank. There is nothing in the agreement to suggest that anyone but Still-co was the lessee. It appears that Mr. Still signed as an individual only in the capacity of a guarantor, not as a lessee.

The only contract clause in issue in this case is paragraph 21, which provides:

This agreement shall be deemed to have been made in Cook County, Illinois, regardless of the order in which the signatures of the parties shall be affixed hereto, and shall be interpreted and the rights and liabilities of the parties hereto determined in accordance with the laws of the State of Illinois. The LESSEE hereby designates Lowell Sachnoff, 105 West Adams Street, Chicago, Illinois, 60603 and/or William Weaver, 105 West Adams Street, Chicago, Illinois, 60603 as agents for the purpose of accepting to forward by certified mail any process served upon him to the LESSEE at its address as set forth above.

Liberty Leasing filed suit against both Stillco, Inc., and Mr. Still in Cook County, Illinois. Still is a resident of Texas. On July 10, 1974, the Illinois court rendered judgment for Liberty Leasing against Still-co and Jess F. Still in the amount of $8,000. The order further stated:

IT IS ORDERED that defendants, Stillco Inc. and Jess F. Still shall return to the possession of plaintiff, within three (3) days from the entry of this judgment, the following goods and chattels, to-wit:
1 only caterpillar D7 E Tractor, Serial No. 48A1157
1 only caterpillar 75 Dozer, Serial No. 59F-493
1 only caterpillar 173 Hyd. Control, S/N/ 48C-11281 OM4255,
or upon failure to do so, the plaintiff shall have and recover of defendants, Stillco Inc. and Jess F. Still the sum of $8,000.00 plus court costs.

Subsequently, Liberty Leasing filed suit in Texas alleging that Stillco and Jess F. Still had defaulted on the equipment lease, that Liberty Leasing had obtained judgment against Stillco and Still in Illinois, and that such judgment was entitled to full faith and credit. The Texas trial court awarded Liberty Leasing $9,453.01. Only Still appealed this judgment and as to him the Waco Court of Civil Appeals reversed the judgment of the trial court and remanded the cause. Still v. Liberty Leasing Co., 570 S.W.2d 93 (Tex.Civ.App.1978, no writ). The second trial resulted in this take-nothing judgment.

In its first two points of error, Liberty Leasing contends that the opinion of the Waco Court of Civil Appeals stated the law of the case, so the trial court in this case erred in rendering judgment contrary to that opinion’s stated law. Further, Liberty Leasing attacks certain findings of the trial court, maintaining that they were not authorized because the trial court was required to follow the law of the ease as expressed by the Waco court.

The opinion in Still v. Liberty Leasing Co., supra, addressed the only issue raised, whether the Illinois judgment was void because Still was not served with process and had no notice of the suit. The court stated at page 94:

There is no evidence that the agents appointed in the lease were served with process in the Illinois suit. As noted the Illinois judgment recites that defendants were ‘duly served with summons.’ If there had been evidence that the agents appointed to receive process had in fact been served, the Illinois judgment would be enforceable in Texas as it would be in Illinois.
sf: * * * * *
Thus, the authenticated Illinois judgment raised a presumption that service of process was had on defendant; but such presumption vanished when defendant testified unequivocally he had not been served. At this juncture it was incumbent upon plaintiff to adduce evidence that the agents for service named in the lease agreement had actually been served, if such was the fact. This, plaintiff did not do.

Because Liberty Leasing failed to prove service of process on Still or due notice to him, the cause was “remanded to the trial court under the rule laid down in Morrow v. Shotwell, Tex., 477 S.W.2d 538, and Scott v. Liebman, Tex., 404 S.W.2d 288.” The Texas Supreme Court stated in Morrow, at page 542:

See Scott v. Liebman, supra, where we said: ‘However, both the Court of Civil Appeals and this Court, having found error in the judgment of the trial court, are authorized in a proper case to remand in the interest of justice. Both courts have discretion in this matter. Dahlberg v. Holden, 150 Tex. 179, 238 S.W.2d 699 (1951) . . . .’ We see no compelling reason at this late hour to recant our holdings in the cited cases; accordingly, we have concluded that this cause should be remanded to the trial court so that Morrow may, if he wishes, amend his pleadings and try his case on a different theory.

Liberty Leasing contends that because Still failed to complain on the first appeal that he was not designated as a lessee in the lease agreement, that he was not a named party to the lease agreement, or that he did not designate agents to accept service of process for him within the state, he is thereby precluded from asserting such issues at the second trial. Where the remand of a cause is accompanied by instructions restricting the retrial to particular issues, the parties must keep within those issues and may not re-litigate matters controverted at the former trial. Owens v. Lubbock Independent School District, 237 S.W.2d 711 (Tex.Civ.App.1950, writ ref. n. r. e.). As the remand in our case was unrestricted, new issues could be raised at the second trial. This procedure is in accord with the Morrow v. Shotwell principle relied upon by the Waco court. Consequently, the court at the second trial was free to make findings of fact and conclusions of law based on the evidence adduced in that trial and unhampered by the prior appellate decision. Points of error 1 and 2 are overruled.

In its third point of error, Liberty Leasing asserts that the trial court erred in not rendering judgment in its favor because the Illinois judgment was entitled to full faith and credit. It maintains that the Illinois court had valid in personam jurisdiction over Still because when he signed the contract, he voluntarily assented to Illinois jurisdiction and to the appointment of an agent to receive process. In point of error 4, Liberty Leasing says that notice to the agent constituted notice to the principal. Finally, Liberty Leasing contends there was sufficient evidence in the record to support a finding that the Illinois court had jurisdiction.

Article IV, Section 1 of the United States Constitution provides in pertinent part:

Full Faith and Credit shall be given in each State to the public Acts, Records, and judicial Proceedings of every other State. .

The full faith and credit clause does not automatically make a sister-state’s judgment a judgment in another state. “A judgment in one State is conclusive upon the merits in every other State, but only if the court of the first State had power to pass on the merits — had jurisdiction, that is, to render the judgment.” Williams v. North Carolina, 325 U.S. 227, 65 S.Ct. 1092, 1095, 89 L.Ed. 1577 (1945). The courts of one state have the right to question whether a court of another had jurisdiction when it entered the judgment sought to be afforded full faith and credit. Williams v. North Carolina, supra: Elkins v. West, 554 S.W.2d 821 (Tex.Civ.App.1977, no writ).

The trial court in our case was authorized to examine the jurisdiction of the Illinois court over Still. It found that Illinois was without jurisdiction, and we agree with that finding. The contract named a sole lessee, Stillco, Inc., and only the lessee designated an agent for service of process. Still testified that he never received notice of the Illinois trial and only learned of the judgment when suit was filed in Texas. He was not shown to have consented to jurisdiction of the Illinois court nor to have appointed an agent to receive service of process. Illinois lacked in personam jurisdiction over Still, so its judgment against him was not entitled to full faith and credit.

The judgment of the trial court is affirmed.

COLEMAN, C. J., and DOYLE, J., also sitting.