author: GUITTARD, Chief Justice.

text:
    O. K. JONES and Ted Hunt, Jr., Appellants, v. R. L. McSPEDDEN, Paul Hamby and Charles C. Shaver, Appellees.
    No. 19336.
    Court of Civil Appeals of Texas, Dallas.
    Dec. 8, 1977.
    Rehearing Denied Jan. 5, 1978.

      David C. Lair, Dallas, for appellants.
    B. J. Stephens, Stephens & Stephens, Dallas, for appellees.
   GUITTARD, Chief Justice.

This appeal raises questions concerning waiver of defects in a motion for summary judgment and the affidavit supporting it and concerning the sufficiency of an opposing affidavit. The litigation began as a suit on a promissory note against a corporation and five of its stockholders as guarantors. Three of the guarantors, R. L. McSpedden, Paul Hamby and Charles C. Shaver, filed a cross-claim against the other two guarantors, O. K. Jones and Ted Hunt, Jr., on an indemnity agreement. Before the main suit was tried, cross-plaintiffs filed a motion for summary judgment, which the court granted. After trial of the main cause before a jury, judgment was rendered for plaintiffs against all defendants, and the final judgment incorporated the summary judgment in favor of cross-plaintiffs. Cross-defendants filed a motion for new trial, which was overruled, and the only complaints on this appeal are directed to the judgment against cross-defendants on the indemnity agreement.

Two of cross-defendants’ points attack the summary judgment for defects in the motion and the supporting proof. Cross-defendants point out that the motion does not state the specific grounds for summary judgment, as required by rule 166-A(c), Texas Rules of Civil Procedure, and they assert that there is no properly authenticated copy of the indemnity agreement attached to the motion, since the only purported copy of the agreement in the record is an unsworn photocopy attached to the cross-claim. Neither of these defects was pointed out to the trial court before the partial summary judgment was rendered, or even before the final judgment was signed, but both were assigned as error in cross-defendants’ motion for new trial.

Cross-defendants concede that these defects are of the sort that cannot be raised for the first time on appeal under the holding in Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230, 234 (Tex.1963), but they argue that they were not waived because they were presented when the trial court still had power to grant a new trial. We conclude that these defects were matters of form that might easily have been cured if they had been pointed out in the response to the motion for summary judgment and, consequently, that they were waived by cross-defendants’ failure to raise them before the interlocutory summary judgment was rendered.

Insofar as the motion for summary judgment failed to specify the grounds, we recognize that it did not comply with rule 166-A(c). Such a failure, however, is not in itself ground for reversal. If the opposing party files an exception to the motion stating that failure to specify the ground for summary judgment leaves him without adequate information for opposing the motion, and this exception is overruled, then he might have a valid complaint on appeal. Here, however, cross-defendants’ response contained no such exception. If it had, the defect could easily have been cured by amending the motion. Since no such exception was filed, we hold that this defect was waived. Spray v. Stash, 523 S.W.2d 262, 263 (Tex.Civ.App.-Eastland 1975, writ ref’d n. r. e.).

This holding is based on the same principle as that underlying rule 90, Texas Rules of Civil Procedure, which provides that defects in pleading are waived unless specifically pointed out by motion or exception in writing before the charge to the jury or rendition of judgment. Rule 166-A has been amended to require a special set of pleadings for summary judgment purposes. Subdivision (c) requires the motion for summary judgment to state specific grounds and has been further amended, effective January 1, 1978, to provide for an “answer or other response” by the opposing party. The function of these summary-judgment pleadings is to define the issues for the purpose of summary judgment, as the function of the principal pleadings is to define the issues for the purpose of trial. Consequently, although rule 90 does not specifically refer to summary-judgment pleadings, we hold that the same considerations apply and that defects in the motion are waived if not pointed out by timely exception.

Somewhat different considerations apply to the failure of cross-plaintiffs to support their motion for summary judgment with a properly authenticated copy of the indemnity agreement in question, but we conclude that the principle of waiver applies here also. The cross-claim alleges that the photocopy attached is a true copy of the indemnity agreement, and McSped-den’s affidavit filed in support of the motion states that the allegations in the cross-claim are true. Moreover, this affidavit states that the affiant saw all the parties sign the document attached to the cross-claim. Thus the record contains at least two sworn statements to the effect that the photocopy attached to the cross-claim is a true copy of the agreement on which the cross-claim is based. Technically, of course, the photocopy in this record is only a part of the pleading, and pleadings, even though sworn, are not proper summary-judgment proof under Hidalgo v. Surety Savings & Loan Ass’n, 462 S.W.2d 540, 545 (Tex.1971). Nevertheless, we regard this defect as one of form rather than of substance under the holding in Youngstown Sheet & Tube Co. v. Penn, 363 S.W.2d 230, 234 (Tex.1963). If cross-defendant had excepted to the affidavit because no properly authenticated copy of the indemnity agreement was attached, as did the complaining party in Texas Nat’l Corp. v. United Systems Internat’l Inc., 493 S.W.2d 738, 739 (Tex.1973), the defect could have easily been cured before the hearing on the motion for summary judgment by filing a properly authenticated copy of the agreement. The policy underlying the rules of civil procedure is that for most procedural errors to be corrected on appeal the complaining party must make his objection in the trial court, when practicable, at a time when the trial judge can correct the error without substantial interference with the judicial process. Applying this policy, the supreme court has held that an objection to rendition of judgment on an incomplete verdict comes too late because it should have been made before the verdict was received and the jury discharged. Lewis v. Texas Employers Ins. Ass’n, 151 Tex. 95, 246 S.W.2d 599, 601 (1952). On the same reasoning, we hold in the present case that since cross-defendants failed to point out the defect in the summary judgment proof in their response, or in any other manner, until long after the summary judgment was rendered, the defect was waived.

To permit the objection to be raised for the first time in the motion for new trial, as cross-defendants contend, would hinder the efficient administration of justice, as the present record demonstrates The summary judgment in question was rendered on the cross-claim more than a year before the court rendered judgment on the main claim after trial before a jury. On hearing cross-defendant’s motion for new trial, the judge could not simply have allowed cross-plaintiffs to cure the defect by amendment or additional filings, giving the cross-defendants additional time to respond, as he might have done at the hearing on the motion for summary judgment. If he had granted a new trial on this ground, he would have had to consider whether to grant a new trial in the main case also, since the posture of the parties at that trial might have been affected by the summary judgment. We are convinced, therefore, that the better rule is that defects of form, such as those in the present motion and its supporting proof, are waived if not pointed out to the court before summary judgment is rendered.

We turn now to cross-defendants’ points asserting that they raised genuine issues of material fact by their affidavit in opposition to the motion for summary judgment. The main averments of this affidavit are the following:

The said agreement was without consideration for the following reasons:
1. The joint venture and Gar-Dal, Inc. were insolvent at the time of the purported conveyance of cross-plaintiffs’ interest in the joint venture and transfer of cross-plaintiffs’ stock in Gar-Dal, Inc. to cross-defendants, the interest and stock were worthless and of no value whatsoever, therefore, there was no consideration to support the purported agreement.
2. Cross-defendants were induced into signing the purported agreement by cross-plaintiffs, and in particular, cross-plaintiff, R. L. McSpedden, an attorney, at a time when cross-plaintiffs knew the interests and stock therein mentioned were of no value whatsoever and worthless.

We hold that these conclusory statements are insufficient to raise a fact issue for several reasons. First, the indemnity agreement (which we have held to be properly before the court in absence of any objection to its lack of authentication) recites considerations other than the transfer of the stock, and the affidavit of cross-defendants does not negate such other considerations. Second, the statement that the corporation was insolvent and its stock worthless does not establish lack of consideration. The indemnity agreement in question shows on its face that it was made, at least in part, to facilitate an effort to raise capital for the continuing operations of the corporation. Thus, although the enterprise may have been in difficulty, the corporation was evidently still functioning, and cross-defendants, like other stockholders, could evaluate its prospects. If they agreed to give their indemnity to cross-plaintiffs in consideration of a transfer of cross-plaintiffs’ stock, that agreement cannot be said to lack consideration because cross-defendants’ evaluation of the corporation’s prospects turned out to be inaccurate. Third, the assertion that cross-plaintiff McSped-den knew that the stock was worthless is not competent summary-judgment proof, since it states an opinion about McSped-den ⅛ state of mind, a matter on which the affiants could not have had direct personal knowledge. Fourth, even if McSpedden and the other cross-plaintiffs had regarded the stock as worthless at that time, there is no summary-judgment proof that the transaction was “tantamount to fraud,” as cross-defendants assert in their brief, since there is no evidence that cross-defendants did not have the same information as cross-plaintiffs concerning the financial affairs of the corporation, of which they were all stockholders. The fact that McSpedden was a lawyer gives rise to no inference that he was in a superior position to determine the value of the stock or that he took an unconscionable advantage of cross-defendants in obtaining their signatures on the indemnity agreement. For all these reasons, we hold that the opposing affidavit is insufficient to raise any genuine issue of material fact.

Affirmed.

ROBERTSON, J., not sitting.


source: Caselaw Access Project

author: AKIN, Justice.

license: Public Domain

text:
    Priscilla E. PARNESS, Appellant, v. Howard A. PARNESS, Appellee.
    No. 19430.
    Court of Civil Appeals of Texas, Dallas.
    Dec. 9, 1977.

      Donald R. Smith, Reba Graham Rasor, Dallas, for appellant.
    James A. Williams, Milan Randolph Pha-ro, Bailey, Williams, Westfall, Lee & Fowler, Dallas, for appellee.
   AKIN, Justice.

Appellant, Priscilla Parness, appeals from an order appointing a receiver to take charge of and sell the homestead of the parties pending a divorce action. Appellant urges the trial court was without power to appoint a receiver for this purpose absent a showing that the property was in danger of being lost, removed or materially altered. She argues there was no showing of any urgency or danger or immediate loss to the property. We agree and accordingly reverse the judgment of the trial court and vacate its order appointing a receiver.

It is well settled in Texas that the appointment of a receiver is a harsh remedy and should only be exercised in extraordinary circumstances. Rogers v. Rogers, 150 S.W.2d 139 (Tex.Civ.App.-Dallas, 1941, no writ); Texas Consolidated Oils v. Hartwell, 240 S.W.2d 324 (Tex.Civ.App.-Dallas 1951, mand. overr.); Gunther v. Dorff, 296 S.W.2d 638 (Tex.Civ.App.-Waco 1956, writ dism’d). Only where the evidence shows some serious injury will result to the applicant, or is threatened, will the drastic remedy of receivership be applied. Texas Consolidated Oils v. Hartwell, supra; Hughes v. Marshall, 538 S.W.2d 820 (Tex.Civ.App.—Tyler 1976, writ ref’d n. r. e.). Finally, a receiver should be appointed only in those situations where the property involved is in present danger of being lost, removed or materially injured and should never be ordered if another remedy, less harsh, is available which will afford the needed protection. Rogers v. Rogers, supra at pp. 140-141; Texas Consolidated Oils v. Hartwell, supra; Parr v. First State Bank of San Diego, 507 S.W.2d 579 (Tex.Civ.App.-San Antonio 1974, no writ).

Here no showing was made by appellee that if a receiver is not appointed to sell the home, the property will be lost. Nor is there a showing of any urgency requiring sale of the house. The real estate broker testified at the hearing that in his opinion the property was not in eminent danger of destruction by deterioration. Appellee’s testimony is that it is difficult for him financially to keep up the house payments, the maintenance on the house and temporary child support and that the sale of the house would ease his situation. There is no evidence that the house payments were delinquent or that foreclosure was imminent, but, there is evidence that appellee, a physician, can borrow the money for house payments. Presumably he could likewise borrow funds for other necessities, pending a final decree. This evidence is insufficient to show that the property itself was in danger of being lost, destroyed or materially altered. For these reasons, we hold that it was error for the trial court to appoint a receiver to sell the house. Accordingly, the order appointing the receiver is vacated.


author: OSBORN, Justice.

text:
    THREE BEARS, INC., et al., Appellants, v. TRANSAMERICAN LEASING COMPANY, Appellees.
    No. 6632.
    Court of Civil Appeals of Texas, El Paso.
    Dec. 14, 1977.
    Rehearing Denied Jan. 11, 1978.
    Lang, Cross, Ladon, Boldrick & Green, Paul M. Green, Lawrence H. Rubenstein, James N. Martin, Law Offices of Bruce Waitz, Bruce Waitz, Van H. Johnson, San Antonio, for appellants.
    Robert C. Patterson, San Antonio, for appellant guardian ad litem.
    Daniel R. Rutherford, San Antonio, for appellee.
   OPINION

OSBORN, Justice.

Our prior opinion in this case, dated November 2, 1977, is withdrawn and the following opinion is substituted therefor.

This is an appeal from a judgment in a jury-tried case. The trial Court, after vacating its first judgment, entered a second judgment for damages and attorney's fees as found by the jury. It appears from the record that this case has become a procedural nightmare for all concerned with the trial and the appeal.

Three Bears, Inc., was engaged in operating a chain of hamburger stands in San Antonio. In February, 1972, Three Bears ordered restaurant equipment from Ray Pittman for three new locations. Trans-american Leasing Company proposed to actually purchase the equipment and then lease it to Three Bears. In May and June, 1973, Three Bears, joined by the G. S. and Gladys A. McCreless Trust, executed three leases in favor of Transamerican, each for a term of 60 months. The first and last monthly payments were made as provided for in the lease. No other payments were ever made because Transamerican was unable to obtain “funding” or financing to pay Pittman for the equipment.

After Transamerican was unable to secure permanent financing, the G. S. and Gladys A. McCreless Trust guaranteed a loan from the First National Bank of San Antonio to Transamerican for $88,000.00 as interim financing. Eventually, the Trust paid the note and caused it to be assigned to G. S. McCreless.

Transamerican filed this suit against Three Bears and the Trust to recover on the three leases. Numerous defenses were alleged in answer to the suit. The case was submitted to the jury on issues covering conditional delivery of the leases, failure of consideration, damages, and attorney’s fees, all of which were answered favorably to Transamerican. On December 4, 1975, judgment was entered on the verdict. A motion for new trial was filed on December 12, 1975, and amended on December 31, 1975. It then became apparent for the first time to the Court and counsel for Appellee that there had been no compliance with Article 7425b — 19, Tex.Rev.Civ.Stat.Ann., which requires notice be given to each beneficiary of a trust prior to entry of a judgment in a suit involving a trust. Trans-american filed a motion to reopen the case for a limited purpose so as to give notice to these beneficiaries and to then enter an amended judgment based upon the original jury findings.

On February 12, 1976, the Court vacated its prior judgment and directed Transamer-ican to comply with Section 19 of the Texas Trust Act. The Court appointed a guardian ad litem to represent two minor contingent beneficiaries of the Trust. The two beneficiaries and seven contingent beneficiaries were all cited to appear. Transamerican then filed a motion for judgment and after a hearing the Court apparently concluded that the provisions of Article 7425b-19 had not been timely complied with and that a new trial was necessary. Transamerican then filed a motion to reconsider which was granted and judgment was entered for Transamerican on August 17, 1976, based upon the earlier jury findings.

During the time the parties and the trial Court were involved with the question of Transamerican’s compliance with the Texas Trust Act, the beneficiaries of the Trust filed a motion for leave to file a petition for writ of mandamus in the Texas Supreme Court to require the trial judge to vacate the alleged void judgment entered on December 4, 1975, and to proceed to trial of the case. The motion was overruled on June 9, 1976, and rehearing denied on July 14, 1976. Durr v. Spears (B-6030), 19 Tex.Sup.Ct.Jr. 338 and 382.

The Appellants have timely appealed from the judgment entered in August, 1976. We must first determine the effect of the order of the Court entered on February 12, 1976, vacating the judgment which had been entered on December 4, 1975. The judgment was vacated more than 30 days after it was entered but within 45 days after the amended motion for new trial was filed. See Rule 329b, Secs. 3 and 5, Tex.R. Civ.P. Basically, Section 3 of this Rule requires that all motions and amended motions for new trial be determined within 45 days after they are filed. Section 5 provides in part that judgments shall become final 30 days after the date of rendition of judgment or order overruling a motion for new trial. Much has been written about a trial Court’s “plenary power” over its judgment based upon Rule 329b. That is the basic issue involved in this ease. We hold that after 30 days from the rendition of judgment, the Court’s plenary power over its judgment terminates in a case where a motion for new trial is not overruled. We hold that an order vacating a prior judgment within 45 days after a motion or amended motion for new trial is filed has the effect of granting a new trial.

In 1973, this Court, in El Paso Moulding and Manufacturing Co. v. Southwest Forest Industries, 492 S.W.2d 331 (1973, writ ref’d n. r. e.), said:

“ * * * It has been said that the Texas practice proceeds on the notion that there is something slightly sacrosanct about the precise periods within which motions for new trial must be filed and determined. 4 McDonald, Texas Civil Practice, Sec. 18.06.1, p. 241. The same may be said of the trial Court’s inherent power to modify or amend a final judgment. It could have amended the final judgment until but not after the expiration of thirty days from the rendition of the final judgment * * *."

We still adhere to that holding. Most of the cases relied upon by Appellee in its motion for rehearing also support such holding.

In First State Bank and Trust Company of Port Lavaca v. Vector Corporation, 427 S.W.2d 958 (Tex.Civ.App.-Waco 1968, writ ref’d n. r. e.), the Court recognized “that the trial court had plenary power, until the expiration of 30 days after the date of judgment in the case on its merits, or after a motion for new trial was overruled, to vacate, modify or reform the judgment, to correct clerical errors in the judgment or to grant a new trial * * (Emphasis added). That was also the holding by the Court in Turner v. Texas Sportservice, Inc., 312 S.W.2d 388 (Tex.Civ.App.-San Antonio 1958, writ ref’d n. r. e.), where Justice Barrow, writing for the Court, said:

“* * * The court has plenary power until (but not after) ‘the expiration of thirty (30) days after the date of judgment or after a motion for new trial is overruled,’ regardless of the expiration of a term of court during such period, to vacate, modify, correct or reform the same or to grant a new trial, according to the justice of the case. McDonald, Texas Civil Practice, Vol. 4, pp. 1420-1421, Sec. 18.03. * * *”

The Court in that case went ahead to note that an order vacating its original judgment was valid since it was entered within 45 days after the filing of the motion for new trial. Likewise, in our case the order vacating the original judgment was valid because it was entered within 45 days after the filing of the amended motion for new trial.

These cases all recognize that the Court has complete power over its judgment for a period of 30 days, but that plenary power ends after 30 days when a motion for new trial is not overruled. Rector v. Rector, 454 S.W.2d 229 (Tex.Civ.App.-Tyler 1970, no writ). The Court’s only remaining power after that date is to grant or deny timely filed motions for new trial. It is on that basis that we hold that when the trial Court vacated the original judgment, more than 30 days after the entry of the first judgment, it necessarily granted a new trial.

In First National Bank in Dallas v. Walker, 544 S.W.2d 778 (Tex.Civ.App.-Dallas 1976, no writ), the change in the judgment was made within 30 days from the time the original judgment was entered and the Court in its opinion specifically noted that under the provisions of Rule 329b, Tex.R.Civ.P., a judgment does not become final for 30 days and that the trial Court has jurisdiction over its judgments during that period of time. In both Thompson v. Gibbs, 504 S.W.2d 630 (Tex.Civ.App.-Dallas 1973), and Silberstein v. State, 522 S.W.2d 562 (Tex.Civ.App.-Austin 1975, no writ), the appellate Courts noted that the trial Court could vacate, correct, alter or modify the original judgment because such action was taken within 30 days after the motion for new trial was overruled. Those cases are not applicable in the case at bar since the trial judge in this case did not overrule the motion for new trial but, instead, vacated the first judgment. Had the trial Court overruled the motion for new trial, under Section 5 of Rule 329b, it would have had 30 days within which to vacate, correct, amend or modify the original judgment, but that is not what happened in this case.

In two mandamus cases, the Supreme Court of Texas has interpreted the provisions of Section 5 of Rule 329b and noted that a judgment becomes final 30 days after the date of rendition of judgment or order overruling an original or amended motion for new trial. Deen v. Kirk, 508 S.W.2d 70 (Tex.1974); General Motors Corporation, Chevrolet Division v. Lane, 496 S.W.2d 533 (Tex.1973).

Of all the cases cited to us by the Appel-lee in its motion for rehearing, we find language in only one case with which we may be in conflict. In Dubert v. Adkins, 475 S.W.2d 383 (Tex.Civ.App.-Corpus Christi 1971, no writ), the Court said: “The trial court has plenary power over its judgments during the thirty day period after the judgment has been rendered or before a timely filed motion for new trial has been overruled.” The Court, in that opinion, then cites the Vector Corporation case noted above in support of its statement. The Vector Corporation case does not support the actual language used. In the Dubert case, the Court went on to say: “This amended judgment was timely entered because the trial court still had control of its judgment while the motion for new trial was pending before it. Rule 329b, T.R.C. P.” Although this language is dictum, it may be in conflict with our holding in this case because the amended judgment was entered more than 30 days after the original judgment, although it may have been after the amended motion for new trial was overruled.

Although there is no conflict in the language used, we do find some conflict in the results reached in Imperial Insurance Company v. Ellington, 498 S.W.2d 368 (Tex.Civ.App.-San Antonio 1973, no writ). In that case, the trial Court entered a judgment on March 8, 1972, and a motion for new trial was timely filed on March 17, 1972. On May 1, 1972, less than 45 days after the filing of the motion for new trial, and while it was still pending, the trial Court signed an order setting aside the prior judgment. On the same date, the trial Court entered a new judgment from which an appeal was effected. Justice Cadena in the opinion for the Court, said:

“The effect of the two orders of May 1, 1972, was to set aside the judgment of March 8, 1972, and to substitute a new judgment in its stead. When a judgment is withdrawn and a new judgment is substituted, if such action takes place within thirty days after the rendition of the first judgment or the order overruling motion for new trial, the action of the trial court is but an exercise of its power to control its judgment; * * *.”

As we read the Court’s opinion in that case, the order vacating the first judgment was not within 30 days after the rendition of the first judgment or within 30 days after an order overruling the motion for new trial. Thus, we conclude that the rationale of the opinion is not supportive of the facts stated.

We believe the rule is that the trial Court does have plenary power over its judgments during the 30-day period after the judgment has been rendered, but this period is not extended by a timely filed motion for new trial, and after the end of the 30-day period, the Court may then only grant or deny the motion for new trial. If the motion for new trial is overruled, the Court again has plenary power over its judgment for another 30 days.

The rule as presently written does not support the language used in the Dubert case or the results reached in the Ellington case nor the position taken by the Appellee herein. It is not within our prerogative to either rewrite the rule, or construe it other than as written.

We have carefully considered the Appel-lee’s motion for rehearing and it is overruled. The case is remanded to the trial Court for a new trial.


text:
    Clovis Edward COUNTS, Jr., Appellant, v. Diana L. COUNTS, Appellee.
    No. 19338.
    Court of Civil Appeals of Texas, Dallas.
    Dec. 14, 1977.

      Kenneth D. Fuller, Garland, for appellant.
    James R. Handy, Handy & Morgan, Inc., Hurst, for appellee.
   AKIN, Justice.

The principal question on this appeal is whether exclusive continuing jurisdiction attaches, under § 11.05(c) of the Texas Family Code (Vernon Supp. 1976-77), when the State Department of Public Welfare erroneously informs a court that no other court has continuing jurisdiction affecting the parent-child relationship, but then corrects that information to show that another court does have continuing jurisdiction. We hold that exclusive jurisdiction does not attach. Accordingly, we affirm.

Appellant, Clovis Counts, Jr., appeals from an order of a Dallas County district court dismissing his petition seeking modification of the managing conservatorship of his minor child, Curtis E. Counts. In his petition filed on February 15, 1977, appellant alleged that no other court had continuing jurisdiction. In response, appellee asserted in a motion to dismiss, dated February 25, 1977, that the Schleicher County Court had continuing jurisdiction and attached a copy of an order of that court dated January 12, 1976, increasing child support. On March 4, 1977, the welfare department notified the court that no court had continuing jurisdiction. Thereafter, prior to any hearing, the welfare department notified the court on April 5, 1977, that the Schleicher County Court had jurisdiction of the parent-child relationship. On April 8, 1977, appellee filed her second motion to dismiss, which was granted after an evidentiary hearing on April 14, 1977. Thus, our sole question is whether the erroneous first report of the welfare department may be corrected.

Appellant argues that § 11.05(c) is mandatory and consequently, when the Dallas court was informed, by the Department of Public Welfare on March 4, 1977, that no other court had continuing jurisdiction over that child, whether that information was correct or incorrect, continuing exclusive jurisdiction vested permanently in the Dallas court and, consequently, a subsequent report from the Department was immaterial. In support of his position, appellant cites § 11.05(c) as amended, which provides:

A court shall have jurisdiction over a suit affecting the parent-child relationship if it has been, correctly or incorrectly, informed by the State Department of Public Welfare that the child has not been the subject of a suit affecting the parent-child relationship . . . [Emphasis added indicates the 1975 amendment.]

Thus, appellant argues that the legislature by adding the language “correctly or incorrectly” intended to vest a court with continuing exclusive jurisdiction as soon as it is informed the child has not been the subject of a suit affecting the parent-child relationship, even though that information may be incorrect. We cannot agree. As we read the statute, it provides for the possibility of an erroneous report being submitted by the welfare department when it used the term “incorrectly.” We perceive that the legislature intended that the forum court have jurisdiction to act based upon the welfare report, but implicit in this section, in our view, is that the legislature intended that such a report can be corrected. It would be absurd indeed to hold, as appellant would have us do, that a clerical error by the welfare department cannot be corrected, thus divesting a court of continuing jurisdiction and vesting that jurisdiction in another court. See Smith v. Smith, 519 S.W.2d 152, 153 (Tex.Civ.App.-Dallas 1974, writ ref’d). We hold, therefore, that such an erroneous report may be corrected and that the forum court has jurisdiction until such a corrected report is received from the welfare department.

In further support of appellant’s contention, he points to § 11.06(d) which provides that even if a court has continuing jurisdiction over a child, if another court acquires jurisdiction under § 11.05(c), then that court “shall” transfer the case to the court acquiring jurisdiction under § 11.05(c). Thus, appellant concludes that the legislature intended even an erroneous report from the welfare department to irrevocably activate §' 11.05(c) to oust a court of continuing jurisdiction. We cannot agree because this argument assumes the main point, which is, that the Dallas court acquired jurisdiction under § 11.05(c) and that the report of the welfare department cannot be corrected, which we have held to be untenable.

As we perceive the purpose of § 11.05(c), it is to provide jurisdiction to protect the interest of children, so that a court can act to protect the interest of children even where another court may have continuing jurisdiction of the parent-child relationship under § 11.05(c) but where such fact is unknown to the forum court. Section 11.071(d) provides, however, that if the court in which a petition is filed affecting the parent-child relationship determines that another court has continuing jurisdiction, which factual determination was made here, then the court should dismiss the suit without prejudice. In this case, the issue with respect to the jurisdiction of the Dallas court was forthwith challenged by appellee’s motion to dismiss, attaching copies of a certified order of the Schleicher court clearly showing that the Schleicher court was the court with continuing jurisdiction of the parent-child relationship. When the welfare department sent its erroneous report to the contrary, an obvious conflict in the evidence was presented which appellee attempted to resolve by requesting the welfare department to recheck its records. This recheck of the records of the welfare department resulted in a corrected report reflecting the Schleicher court as the court with continuing jurisdiction of the parent-child relationship. Thus, in our opinion, the Dallas court acted properly in dismissing the suit and preventing the unseemly conflict between two courts as condemned in Curtis v. Gibbs, 511 S.W.2d 263 (Tex.1964). Accordingly, we hold that once the Dallas court was informed by the welfare department that the Schleicher County Court had continuing exclusive jurisdiction over the minor child, whether it be a first report or an amended one, it had the duty to dismiss the case without prejudice. § 11.071(d). This holding follows the principles of dominant jurisdiction enunciated in Curtis v. Gibbs, supra, and Ex Parte Jabara, 556 S.W.2d 592, 597 (Tex.Civ.App.-Dallas 1977, no’writ). Accordingly, the order of dismissal is affirmed. We express no opinion with respect to the situation where an adverse party, having the correct information with respect to the court having continuing jurisdiction, fails promptly to call that information to the forum court’s attention.

      . Unless otherwise indicated, all references are to the Texas Family Code.


author: SPURLOCK, Justice.

text:
    K. F. WELBORN d/b/a Quality Awnings, Appellant, v. Joe Mack WOOLFOLK, Appellee.
    No. 17914.
    Court of Civil Appeals of Texas, Fort Worth.
    Dec. 15, 1977.
    Patrick A. Myers, Jacksboro, for appellant.
    Mitchell G. Davenport, Jacksboro, for ap-pellee.
   OPINION

SPURLOCK, Justice.

Plaintiff, Welborn, sued defendant, Wool-folk, for the reasonable value of services rendered, labor performed, and materials furnished (under a quantum meruit theory) and for the recovery of reasonable attorney’s fees under art. 2226 . It had been stipulated that a reasonable attorney’s fee would be $250. The trial court found that defendant was indebted to plaintiff for $392; however, it denied the recovery of an attorney’s fee. Plaintiff’s sole complaint on appeal is that the trial court erred in denying him the recovery of an attorney’s fee under art. 2226 .

We affirm in part and reverse and render in part.

Since the appellee has not filed a brief, we accept appellant’s version of the facts as being correct. Tex.R.Civ.P. 419.

Defendant, Joe Mack Woolfolk and his wife, own a Dairy Queen Drive Inn located in Jaeksboro, Texas. At Mr. Wool-folk’s request, plaintiff orally agreed (1) to construct and install five “specialty lights”, (2) furnish and install eight “slim line lights”, and (3) install four additional “specialty lights” at defendant’s Dairy Queen.

Plaintiff furnished all materials and performed all the labor in the construction of the specialty lights that were built. Plaintiff and one of his employees performed all the labor for the installation of the lights. After giving plaintiff a check for $392, defendant stopped payment on the check. After efforts to collect the $392 had failed, suit was filed. The suit was based upon a quantum meruit theory of recovery and additionally sought attorney’s fees under art. 2226 *. Judgment was rendered for plaintiff on the $392, but the trial court denied any recovery for attorney’s fees on the ground that the transaction was a “special contract”.

By his sole point of error, plaintiff basically contends that the trial court erred in denying him a recovery of his attorney’s fee under art. 2226 *, because his suit was based upon quantum meruit for services rendered, labor performed and materials furnished and was not based upon a special contract.

Before the 1977 amendment by the legislature, art. 2226 * (Supp.1976) provided:

“Any person, corporation, partnership, or other legal entity having a valid claim against a person or corporation for services rendered, labor done, material furnished, ... or suits founded [upon a sworn account or accounts], may present the same to such persons or corporation or to any duly authorized agent thereof; and if, at the expiration of 30 days thereafter, the claim has not been paid or satisfied, and he should obtain judgment for any amount thereof as presented for payment to such persons or corporation, he may, if represented by an attorney, also recover, in addition to his claim and costs, a reasonable amount as attorney’s fees. . . . ”

The rule that has often been quoted in the cases is that the statute authorizing the recovery of attorney’s fees must be strictly construed, because the statute is in derogation of the common law and is penal in nature. New Amsterdam Casualty Co. v. Texas Industries, Inc., 414 S.W.2d 914 (Tex.1967); Davidson v. Suber, 553 S.W.2d 430 (Tex.Civ.App.-Austin 1977, no writ at present). However, the statutory law of this state is not in accord with this often-quoted “rule of law”.

Tex.Rev.Civ.Stat.Ann. art. 10, § 8 (1969) provides:

“The rule of the common law that statutes in derogation thereof shall be strictly construed shall have no application to the Revised Statutes; but the said statutes shall constitute the law of this State respecting the subjects to which they relate; and the provisions thereof shall be liberally construed with a view to effect their objects and to promote justice.” (Italics added.)

Tex.Penal Code Ann. § 1.05(a) (1974) provides a similar rule:

“The rule that a penal statute is to be strictly construed does not apply to this code. The provisions of this code shall be construed according to the fair import of their terms, to promote justice and effect the objectives of the code.” (Italics added.)

In apparent disregard of these two statutes, many of the cases concerning the recovery of attorney’s fees have set up barriers in an attempt to strictly construe art. 2226 *. One such barrier to the recovery of attorney’s fees is the doctrine of “special contract”. As defined by the case law,

“[A] ‘special contract’ is one with peculiar provisions or stipulations not found in the ordinary contract relating to the same subject matter and such provisions are such as, if omitted from the ordinary contract, the law will never supply. . ” Eisenbeck v. Buttgen, 450 S.W.2d 696, 702 (Tex.Civ.App.-Dallas 1970, no writ).

We are compelled to follow the rules of statutory construction as set forth by our legislature (cited above) in interpreting art. 2226*; accordingly, we conclude that art. 2226 * is to be construed liberally. The facts of this case show that plaintiff’s claim was for services rendered, labor done, and material furnished, as provided for in the statute. As such, the doctrine of “special contracts” should not have been used to defeat a recovery of attorney’s fees in a situation that falls squarely within the perimeters of art. 2226 *.

While not important to this case, art. 2226 * was amended in 1977 to include recovery of attorney’s fees for “suits founded on oral or written contracts.” This amendment convinces us that the doctrine of “special contracts” is no longer a viable doctrine that can be utilized to defeat the recovery of attorney’s fees under art. 2226 *.

We sustain appellant’s point of error; we hold that it was error for the trial court to deny the recovery of attorney’s fees.

We affirm the judgment of the trial court for the $392 awarded for services rendered, labor done and materials furnished; we reverse the trial court’s denial of attorney’s fees under art. 2226 * and render judgment for appellant (plaintiff below) for $250 as reasonable attorney’s fees (the amount of which was stipulated), plus interest at 9% per annum from February 7, 1977, until paid. All costs are taxed against appellee.

       Unless indicated otherwise, all statutory references are to Tex.Rev.Civ.Stat.Ann. art. 2226 (1971).


author: HALL, Justice.

text:
    FIRST STATE BANK, HUBBARD, TEXAS, Appellant, v. W. Sale LEWIS, Savings & Loan Commissioner of Texas, et al., Appellees.
    No. 5766.
    Court of Civil Appeals of Texas, Waco.
    Dec. 15, 1977.
    Rehearing Denied Jan. 12, 1978.

      Jack C. Ogg, Sowell, Capps & Ogg, P. A., Houston, for appellant.
    John L. Hill, Atty. Gen., Catherine A. Brown, Asst. Atty. Gen., John J. McKay, McKay & Wash, Austin, for appellees.
   HALL, Justice.

The principal office of appellee Bi-Stone Savings & Loan Association is located in the City of Mexia, Limestone County, Texas. Bi-Stone made application to appellee Savings & Loan Commissioner of Texas to locate a branch office in the City of Hubbard, Hill County, Texas. The application was contested by appellant First State Bank of Hubbard, Texas. After a hearing, the Commissioner granted Bi-Stone’s application. The Commissioner’s order was affirmed by the trial court, and Bank brought this appeal. Bank seeks reversal on three points of error asserting (1) the public notices of the application and the hearing on the application did not meet the requirements of Rules 1.4 and 2.3 of the Rules And Regulations For Savings And Loan Associations and were fatally defective; (2) the Commissioner’s finding of a public need for the proposed branch office was not reasonably supported by substantial evidence; and (3) Bi-Stone did not meet certain requirements under Rule 2.4 of the Rules And Regulations For Savings And Loan Associations for the granting of a branch application. We overrule these contentions and affirm the judgment.

Rules 1.4 and 2.3 of the Rules And Regulations For Savings And Loan Associations provide that notice of hearing of an application for a branch office “shall be published at least twenty (20) days before the date of hearing in a newspaper . of general circulation in the county [where the branch office will be located].” Bank contends the newspaper used by Bi-Stone in this case was not one of general circulation, and that the notice provision is mandatory and jurisdictional to the hearing by the Commissioner. The record shows without contradiction that Bank had notice and participated in the hearings at all relevant times. Bank does not assert otherwise. Rather, the thrust of Bank’s complaint is that because of noncompliance with the notice requirement constitutional due process was denied unnamed members of the public at large who did not receive notice and were thereby denied the opportunity to appear and contest the application. Bank has not shown how it was harmed by this asserted wrong to others. The general rule in constitutional litigation, applicable here, is that one may not assert the rights of third parties. Bank has no standing to raise the point in issue. Moody v. State, 538 S.W.2d 158, 160 (Tex.Civ.App.-Waco 1976, writ ref’d n. r. e.). In any event, our review of the evidence convinces us that the Commissioner’s finding that the newspaper in question was one of general circulation in Hill County is supported by substantial evidence.

The Commissioner found there is a public need for the proposed branch office. The evidence on this question came from the testimony of Bi-Stone’s president, Bi-Stone’s expert economist-witness, Bank’s expert economist-witness, and exhibits prepared by those witnesses and explained by them. Basically, it was the opinion of Bank’s witness that if located in the City of Hubbard the branch office would serve only the 1,500 residents of that city. It was the opinion of Bi-Stone’s witnesses that Hubbard is the center of a substantially large agri-business community located in part of Hill, Limestone, McLennan and Navarro Counties served in its financial needs only by several small banks (of which appellant bank is the largest) which cannot and do not offer long-term mortgage loans, interest rates, and savings benefits accorded the public by savings and loan associations, and that there is an existing public need and ready market for those services in the area. The Commissioner chose to believe and accept the proof supporting the latter theory. Of course, the record in this case relates to the peculiar area in question and we see little purpose and no precedential value to be served by detailing the proof in this opinion. Our review of the entire record convinces us that the Commissioner’s finding of public need is supported by substantial evidence.

The Texas Savings and Loan Act is codified as article 852a, Vernon’s Ann.Civ.St. In its pertinent parts this statute provides as follows:

“Sec. 7.01. Each association shall close its books on the last business day of June and December of each year, for the purpose of determining the gross income of the association for the period since the date of the last such closing of its books and from which shall be deducted the expenses of operating the association for such period, the balance remaining being the net income for the period.
“Sec. 7.02. If, at the date of any closing of its books, the loss reserves of an association equal an aggregate amount of less than five per cent (5%) of its savings liability, then an amount equal to at least five per cent (5%) of its net income, or so much thereof as may be necessary to increase its loss reserves to the above required amount, shall be transferred from the net income of the association to its loss reserves. In the event that any credit to the loss reserves of an association is made following the effective date of this Act in excess of the minimum five per cent (5%) requirement the dollar amount of such excess may be carried over as a credit toward the minimum requirement for any subsequent accounting period.
“Sec. 7.03. After providing for payment of the expenses of operation of the association and for the required minimum transfer to its loss reserves, the board of directors of the association may declare dividends on savings accounts.
“Sec. 7.04. The balance of net income of the association, if any, may be credited to a surplus account, from which the board of directors of any association whose bylaws provide for the issuance of Permanent Reserve Fund Stock, and which has such stock outstanding, may, at their discretion, and at such times as they may determine, declare and pay dividends in cash or additional stock to the holders of record of such stock outstanding at the date such dividends are declared.
“Sec. 7.05. Any association at any closing date may use all or any part of any surplus accounts, whether earned or paid-in, or any expense fund contributions on its books at such time to meet all or any part of the expenses of operating the association for the period just closed, required transfers to loss reserves, or the payment or credit of dividends declared on savings accounts.”

Under § 2.4 of the Rules And Regulations For Savings And Loan Associations the Commissioner is required to find (among other things) as predicates for the granting of a branch application that:

“(a) the aggregate amount of the loss reserves, surplus and Permanent Reserve Fund Stock, if any, of the applying association is equal to three per cent (3%) of its savings liability;
“(b) the applying association has had a profitable operation for the three year period next preceding the filing of such application after paying operating expense, making statutory allocations to loss reserves, and paying dividends on savings accounts out of its earnings during such period.” (emphasis added).

The Commissioner made express findings in favor of Bi-Stone under these Rules. Bank asserts that the finding under paragraph (b) that Bi-Stone had “a profitable operation” for the required period “after making statutory allocations to loss reserves” does not have support in the evidence.

Bank’s contention is based upon its construction of § 7.02 of article 852a, supra. It says that this statute requires an association at each closing of its books to transfer at least 5% of its net income, or so much more of its net income (up to 100%) as may be necessary to increase and maintain the association’s loss reserves to an aggregate amount of 5% of its savings liability. If this construction is correct, then our record shows without contradiction that it was not met by Bi-Stone during the three years immediately preceding the filing of the branch application in question, and that Bi-Stone would not have had a profitable operation during that period if such allocation had been made to its loss reserves. The Commissioner’s finding under Rule 2.4 (b) would, accordingly, be erroneous.

Oppositely, Bi-Stone and the Commissioner assert that § 7.02 of the statute requires only that an association upon closing its books transfer (1) at least (that is, a required minimum) of 5% of its net income to loss reserves if, at the time of closing, the association’s loss reserves do not equal an aggregate amount of 5% of its savings liability, or transfer (2) a lesser amount than 5% of its net income (that is, that the phrase “or so much thereof” as used in the statute means “so much of 5% of net income,” rather than “so much of net income”) if the lesser amount would increase the association’s loss reserves to 5% of its savings liability. If this construction is correct, then the undisputed evidence on the question supports the Commissioner’s finding of profitable operation by Bi-Stone after statutory allocation to loss reserves during the period required under Rule 2.4.

We agree with the construction asserted by Bi-Stone and the Commissioner. We believe this construction is the legislative intent expressed in the over-all language of the statute. The statute does not prohibit an association from transferring a larger amount than 5% of its net income to loss reserves (as our record shows Bi-Stone has done in the past), but it sets what is denominated in §§ 7.02 and 7.03 as a “required minimum transfer” of 5% of net income. Provision is then made for use of the net income remaining after the required minimum transfer for payment of dividends on savings account, credit to surplus account, and payment of stock dividends. Additionally the record shows, as does Savings And Loan Rule 2.4, (a), supra, that this is the construction which has been placed on the statute in the past by the Commissioner and other regulatory authorities of the Savings and Loan Section of the Finance Commission of Texas who are charged with auditing the operations of savings and loan associations and enforcing the requirements of the Savings and Loan Act. The courts will ordinarily adopt and uphold a construction placed on a statute by an executive officer or department charged with its administration if the statute is ambiguous or uncertain and if the construction so given it is not unreasonable. 53 Tex.Jur.2d 259, Statutes, § 177.

Bank’s points and contentions are overruled. The judgment is affirmed.


author: JAMES, Justice.

text:
    Travis Lee CATCHINGS, By and Through his mother and next friend, Linda Catchings, Appellant, v. Johnny Lee HAMM, a/k/a Johnny Lee, Appellee.
    No. 5797.
    Court of Civil Appeals of Texas, Waco.
    Dec. 15, 1977.

      Robert C. Sohns, Jr., Houston, Stephen D. Smith, National Juvenile Law Center, St. Louis, Mo., for appellant.
    Louis A. Crapitto, Jr., Houston, for appel-lee.
   OPINION

JAMES, Justice.

This is a suit brought by a mother in behalf of an illegitimate child to establish paternity therefor and for child support. Travis Lee Catchings is a male child who was born out of wedlock to Linda Catchings on February 15, 1973. On May 20, 1976, Plaintiff-Appellant Linda Catchings as mother and next friend of Travis Lee Catchings brought this suit alleging that Defendant-Appellee Johnny Lee Hamm is the natural father of said child and requested that the court order child support.

Defendant-Appellee Hamm filed an answer in which he specially pleaded that the action filed against him was barred by the statute of limitation as provided in Section 13.01 of the Texas Family Code. Thereafter, Defendant-Appellee filed a motion to dismiss Plaintiff-Appellant’s cause of action on the ground that same was barred by the provisions of said Section 13.01.

After hearing on the Motion to Dismiss, the trial court dismissed Plaintiff-Appellant’s paternity action for the stated reason that the action was barred by the statute of limitations as provided by Section 13.01 of the Texas Family Code, from which Plaintiff-Appellant Linda Catchings appeals.

Section 13.01 of the Texas Family Code, effective September 1, 1975, provides:

“A suit to establish the parent-child relationship between a child who is not the legitimate child of a man and the child’s natural father by proof of paternity must be brought before the child is one year old, or the suit is barred.”

Appellant attacks the trial court’s order of dismissal, asserting that Section 13.01 is unconstitutional as a denial of due process and equal protection of the laws, insofar as illegitimate children are concerned.

However, we do not reach these questions of constitutionality of Section 13.01, which became effective September 1, 1975. This child was born February 15, 1973, before the effective date of Section 13.01.

The right of an illegitimate child to obtain support from its natural father has been recognized since the United States Supreme Court decision of Gomez v. Perez (1973) 409 U.S. 535, 93 S.Ct. 872, 35 L.Ed.2d 56. Also see In the Interest of R-V-M, a child (Waco CA 1975) 530 S.W.2d 921, no writ, for application of the Gomez holding.

The one-year limitation period prescribed by Section 13.01 could have no application to the case at bar unless such statute was retroactive in effect. It is a well-settled rule of law that a statute should not be given retroactive effect unless such construction is required by explicit language or by necessary construction. Government Personnel Mutual Life Ins. Co. v. Wear (1952) 151 Tex. 454, 251 S.W.2d 525, 529. Also see Alvarado v. Gonzales (Corpus Christi CA 1977) 552 S.W.2d 539, no writ, and the cases cited therein on p. 542. There is nothing in Section 13.01 that would cause such statute to be retroactive in effect.

Since Travis Lee Catchings, the child in the case at bar, was born prior to the effective date of Section 13.01, we are of the opinion and hold that said statute is inapplicable to the case at bar, and applies only to those suits to establish the paternity of illegitimate children born after September 1, 1975. Alvarado v. Gonzales (Corpus Christi CA 1977) 552 S.W.2d 539, no writ.

This being our view of the case, we are of the opinion that the trial court erred in dismissing the cause, and thereby reverse and remand the cause to the trial court for trial on the merits.

REVERSED AND REMANDED.


author: ROBINSON, Chief Justice.

text:
    AMERICAN TRANSFER AND STORAGE COMPANY, Appellant, v. Ernie C. REICHLEY, Appellee.
    No. 8782.
    Court of Civil Appeals of Texas, Amarillo.
    Dec. 19, 1977.
    Rehearing Denied Jan. 16, 1978.

      Golden, Potts, Boeckman & Wilson, Duncan E. Boeckman, Dallas, Johnson, Guthrie, Nash & Shanklin, Robert Lee Guthrie, Dallas, for appellant.
    Smith & Smith, Mickey J. Blanks, Lubbock, for appellee.
   ROBINSON, Chief Justice.

Plaintiff Ernie C. Reichley sued defendant American Transfer & Storage Co. alleging an oral contract whereby American Transfer & Storage agreed to store his household effects. Plaintiff alleged that the defendant company wrongfully sold all of the property that he had stored with it to its branch manager. The trial court rendered judgment on a jury verdict for plaintiff in the amount of $64,000. Defendant appeals. Affirmed.

At the trial, the jury found as follows:

(1) On September 18, 1973, plaintiff and defendant, acting through its agent Larry Winton, orally agreed that defendant would pack, transport and warehouse plaintiff’s household goods in its Lubbock warehouse, to be shipped to a destination at or near Little Rock, Arkansas, within a year from September 18, 1973;

(2) Plaintiff and defendant agreed that the storage charges would accrue until shipment and be paid together with the transportation charges;

(3) Plaintiff and defendant agreed that defendant would look solely to Guerdon Industries to pay for the accrued storage, moving and warehouse charges;

(4) Plaintiff and defendant agreed that plaintiff would cause the accrued storage and moving charges to be paid to defendant by Guerdon Industries upon invoice and shipment of the goods.

(5) The fair and reasonable value of plaintiff’s household goods which were not returned to him was $64,000.

It is undisputed that defendant, after storing the goods for 6 months, sold them to its branch manager Darrell C. Beopple, for $1.00 more than the accrued storage charges. After the sale the defendant company and Beopple returned some clothing and other smaller items to plaintiff.

We overrule defendant’s contention that it was entitled to an instructed verdict merely because it complied with the provisions of Section 7.210 Tex.Bus. & Comm. Code Ann. (Tex.UCC 1965) which govern the procedure for enforcement of a warehouseman’s lien, in selling plaintiffs goods. The initial question is whether defendant had the right to unilaterally terminate the storage. Defendant contends that it had a right to do so by virtue of Section 7.206 since there was no document fixing the period of storage. It also contends that the oral agreement did not fix a period of storage.

§ 7.206. Termination of Storage at Warehouseman’s Option

(a) A warehouseman may on notifying the person on whose account the goods are held and any other person known to claim an interest in the goods require payment of any charges and removal of the goods from the warehouse at the termination of the period of storage fixed by the document, or, if no period is fixed, within a stated period not less than thirty days after the notification. If the goods are not removed before the date specified in the notification, the warehouseman may sell them in accordance with the provisions of the section on enforcement of a warehouseman’s lien (Section 7.210).

This court held in the appeal of the trial court’s judgment in a plea of privilege hearing in this same case that the oral agreement, whereby defendant agreed to store the goods for up to a year until shipment, fixed a period of storage. American Transfer & Storage Company v. Beichley, 543 S.W.2d 162 (Tex.Civ.App.-Amarillo 1976, no writ).

We do not construe Section 7.206 to mean that the warehouseman can terminate the storage at his option, regardless of the agreement of the parties, if there is no document setting out the period of storage. The language of Section 7.206 assumes that a document has been executed. It does not address the situation in which the agreement is entirely oral.

The rule for construing agreements is set out in Tex.Bus. & Comm.Code Ann. § 1.102 (Tex.UCC 1965), as follows:

(c) The effect of provisions of this title may be varied by agreement, except as otherwise provided in this title and except that the obligations of good faith, diligence, reasonableness and care prescribed by this title may not be disclaimed by agreement but the parties may be agreement determine the standards by which the performance of such obligations is to be measured if such standards are not manifestly unreasonable.

We conclude that, under the facts found by the jury, the defendant did not have the option to terminate storage and sell plaintiff’s goods.

Defendant next complains of the failure of the trial court to submit requested issues affirmatively submitting his theory of the conversation between Reichley and defendant’s agent Winton. Defendant did not plead an affirmative defense. We find that the trial court fairly submitted the controlling issues raised by the pleadings and the evidence. The case will not be reversed because of a failure to submit other and various phases or different shades of the same issue. Prudential Insurance Company of America v. Tate, 162 Tex. 369, 347 S.W.2d 556 (1961); City of Amarillo v. Reid, 510 S.W.2d 624 (Tex.Civ.App.-Amarillo 1974, writ ref’d n. r. e.).

We next consider defendant’s points of error contending that the trial court applied the wrong measure of damages in (1) admitting testimony concerning the value of plaintiff’s goods and (2) submitting the damage issue.

Used household goods and personal effects are a unique type of personalty. A special measure of damages is applied to them. It is not necessary to prove an absence of market value as a condition precedent to showing their value to the owner at the time of the loss. International & G. N. Ry. Co. v. Nicholson, 61 Tex. 550 (1884); Ricks v. Smith, 204 S.W.2d 12 (Tex.Civ.App.-Austin 1947, writ ref’d n. r. e.).

In Crisp v. National Ins. Co., 369 S.W.2d 326, 328 (Tex.1963), the Supreme Court held:

It is a matter of common knowledge and of usual acceptation by the courts that used household goods, clothing and personal effects have no market value in the ordinary meaning of that term. They may be sold but only at considerable sacrifice which by no means represents the value of the articles to the owner. We find no recognized authority which would hold the insured to a recovery based solely on the proceeds obtainable on a secondhand market. Likewise, replacement costs do not afford a fair test. In some instances on account of obsolescence, change in style and fashion, this measure might represent an economic gain to the insured quite aside from the difficulty of application and proof. The measure of damage that should be applied in case of destruction of this kind of property is the actual worth or value of the articles to the owner for use in the condition in which they were at the time of the fire excluding any fanciful or sentimental considerations. (Emphasis supplied)

In attempting to arrive at a standard to be used in determining this “value to the owner” measure of damages the Court said that:

The courts have not abandoned the consideration of either market or reproduction or replacement values in arriving at actual value to the insured, but evidence of those values may be used as a guide in making that determination rather than a shackle which compels strict adherence thereto. The trier of facts may consider original cost and cost of replacement, the opinions upon value given by qualified witnesses the gainful uses to which the property has been put as well as any other facts reasonably tending to shed light upon the subject.

Id. at 329.

In International & G. N. Ry. Co. v. Nicholson, 61 Tex. 550 (1884) the Supreme Court ruled on a contention that the value of lost household goods should be determined by value at the place of delivery. The Court stated:

In the present case the value of the goods was proved, but it did not appear from the evidence that there was any difference between their value at the point of their shipment and at the place of their delivery. In fact the lost articles seemed to be of such a character, viz., second-hand clothing, books and table furniture which had been used by the plaintiff, that they could not be said to have to him a value at one place different from what they possessed at another. He could hardly have supplied himself in the market with goods in the same condition and so exactly suited to his purposes as were those of which he had been deprived. As compensation for the actual loss is the fundamental principle upon which this measure of damages rests, it would seem that the value of such goods to their owner would furnish the proper rule upon which he should recover. Not any fanciful price that he might for special reasons place upon them, nor, on the other hand, the amount for which he could sell them to others, but the actual loss in money he would sustain by being deprived of articles so specially adapted to the use of himself and his family.

It is proper for the owner of the lost or damaged household or personal items to testify as to their worth to him individually. Williamson v. Askew, 328 S.W.2d 473 (Tex.Civ.App.-Fort Worth 1959, no writ); Tubbs v. American Transfer & Storage Co., 297 S.W. 670 (Tex.Civ.App.-Dallas 1927, writ ref’d).

We conclude that the trial court did not err in admitting plaintiff’s testimony concerning the value of his household goods. That evidence was legally sufficient to support the submission of the damage issue. Defendant’s point of error concerning the measure of damage submitted is not properly before us because defendant did not object to the court’s charge on that ground. Unless a party objects to the charge on the ground that it submits an improper measure of damages, he waives the objection and cannot complain on appeal that the charge permitted the jury to find damages based on the wrong measure. Rule 274, Texas Rules of Civil Procedure; Lanphier Construction Co. v. Fowco Construction Co., 523 S.W.2d 29 (Tex.Civ.App.-Corpus Christi 1975, writ ref’d n. r. e.); City of Amarillo v. Betts, 429 S.W.2d 685 (Tex.Civ.App.-Tyler 1968, no writ).

In the alternative, defendant contends that the measure of damages for the conversion of plaintiff’s household goods should be limited by Interstate Commerce Commission regulations limiting a shipper’s liability for lost or damaged goods. Defendant cites no authority supporting this contention and we find none. The point of error is overruled.

We do not find that under all the circumstances the trial court abused its discretion in permitting plaintiff to read from a lengthy list of his lost goods which he had prepared and which the court permitted him to use to refresh his memory. See Paul v. Johnson, 314 S.W.2d 338 (Tex.Civ.App.-Houston 1958 writ dism’d). In any event, we do not find that any error in so doing was calculated to or probably did cause the rendition of an improper verdict so as to require reversal under Rule 434, T.R.C.P.

We overrule each of appellant-defendant’s points of error.

The judgment of the trial court is accordingly affirmed.

DODSON, J., not participating.


text:
    Henry ATKINSON, Appellant, v. Marqueita ATKINSON, Appellee.
    No. 8786.
    Court of Civil Appeals of Texas, Amarillo.
    Dec. 19, 1977.
    Appellant’s Motion and Appellee’s Rehearing Denied Jan. 16, 1978.

      A. W. Salyars, Joyce Hill, Lubbock, for appellant.
    Brown & Harding, Mike Brown and Ralph H. Brock, Lubbock, for appellee.
   ROBINSON, Chief Justice.

This suit involves a property settlement agreement which was incorporated into a divorce decree. Marqueita Atkinson sued her former husband, Henry Atkinson, to enforce that part of the property settlement agreement providing for payments of $200 per month for 47 months. The trial court granted her motion for summary judgment, awarding her the accrued payments and the present value of the future installments. Defendant has appealed from the summary judgment, alleging the existence of genuine questions of fact. Affirmed.

Henry and Marqueita Atkinson were divorced in the 140th District Court of Lubbock County, Texas in October, 1974. Prior to the divorce, the parties entered into a child custody and property settlement agreement which was incorporated in the final divorce decree. The trial court found that the agreement was fair and reasonable. The provision of the agreement in issue required defendant to pay his wife $200 per month for 47 months “to equalize the property division herein made.”

Henry Atkinson made only six payments of $200 to his former wife. In October, 1975, Marqueita Atkinson filed suit to enforce the agreement, seeking judgment for the past due installments and for anticipatory breach of the contract. In response to Plaintiff’s Requests and Interrogatories defendant stated that he did not consider the property settlement agreement to be valid.

Plaintiff moved for summary judgment pursuant to Rule 16&-A, Texas Rules of Civil Procedure, based on the pleadings, affidavits and certified copies of court records. Defendant alleged that under the property settlement agreement his wife received six times the value of assets as he, implying that the monthly payments could not have been “to equalize the property division.”

The court granted Plaintiff’s Motion for Summary Judgment, finding that no genuine questions of fact existed and that plaintiff was entitled to a recovery under the terms of the property settlement agreement on file in the 140th District Court of Lubbock County, Texas.

Defendant has raised contractual defenses to the property settlement agreement — failure of consideration and uncon-scionability. Were we to consider these defenses, we would be permitting a collateral attack on the divorce decree. An agreement incorporated into the divorce decree has the same force and effect as any other judgment, and the absence of fraud or mistake is binding between the parties and stands as a final disposition of their rights. Eagle Lumber Co. v. Trainham, 365 S.W.2d 702 (Tex.Civ.App.-San Antonio 1963, writ ref’d n. r. e.). Since Atkinson did not appeal from the divorce judgment, the finality of that judgment cannot be collaterally attacked. Peddicord v. Peddicord, 522 S.W.2d 266 (Tex.Civ.App.-Beaumont 1975, writ ref’d n. r. e.).

The facts in Peddicord v. Peddicord, supra, are similar to those in the case at bar. The wife sued to enforce a property settlement agreement incorporated into their divorce decree. Her husband’s sole point of error was that summary judgment was improper because the trial court failed to allow him to assert contractual defenses to the property settlement agreement. We are in agreement with the holding of that court:

We do not decide this case by passing upon the contractual defenses raised by defendant, and holding they have no merit. We hold that the judgment of the trial court entered December 7, 1970, became a final judgment when there was no appeal. Upon a suit to enforce the terms of the settlement agreement approved in such judgment, the sanctity and finality of that judgment cannot be collaterally attacked. Therefore, no issues of fact were raised by the defendant through his pleadings, and the trial court properly granted plaintiffs motion for summary judgment.

Id. at 267.

Collateral attack would only be permissible if the judgment were void, as determined from the face of the record. Ex Parte Tyler, 152 Tex. 602, 261 S.W.2d 833 (1953). Defendant has not alleged that the divorce judgment is void for lack of jurisdiction over the parties or subject matter, and the record does not reveal any jurisdictional defects.

The trial judge properly granted summary judgment in favor of Mrs. Atkinson for a liquidated claim on the contract.

Mrs. Atkinson prays for the imposition of a 10% penalty against defendant for bringing this appeal without sufficient cause for purpose of delay. Texas Rules of Civil Procedure 435. We find that this is not a proper case for imposing such a penalty-

The summary judgment granted by the trial court is affirmed.

DODSON, J., not participating.


author: COLEMAN, Chief Justice.

text:
    Johnny VOUDOURIS, Appellant, v. WALTER E. HELLER & COMPANY, Appellee.
    No. 16948.
    Court of Civil Appeals of Texas, Houston (1st Dist.).
    Dec. 22, 1977.

      Eskew, Brady, Womack & Muir, James Brady, Austin, for appellant.
    Ross, Banks, May, Cron & Cavin, John Mayer, Houston, for appellee.
   COLEMAN, Chief Justice.

Walter E. Heller & Company brought suit on a sworn account against Nick Wayne Voudouris and Johnny Voudouris d/b/a Carpet Gallery of Austin, Ltd. A judgment was entered against Nick Wayne Voudouris, who subsequently went through bankruptcy. The case was severed, and after a trial before the court, judgment was entered against Johnny Voudouris. This appeal resulted. The judgment will be reversed.

In answer to the plaintiff’s petition Johnny Voudouris denied that he had ever been a general partner in the business of Carpet Gallery of Austin, and alleged that he had not taken part in the control of the business; that he had never accepted nor received any profits, other compensation, or income from Carpet Gallery of Austin; that Carpet Gallery of Austin, Ltd. was a limited partnership at all times; that Nick Wayne Voudouris was the general partner and Johnny Voudouris was a limited partner in the limited partnership, which was formed on or about October 30,1973 and was ended on or about April, 1974. He also filed under oath a sworn denial of the account.

After the plaintiff had introduced documentary evidence to prove up the account owed to it by Carpet Gallery of Austin, he called the defendant Johnny Voudouris as a witness. All of the testimony relating to the issue of partnership, with exceptions to be noted, was given by this witness.

Johnny Voudouris testified that in 1974 he was a county commissioner in Travis County and owned an interest in two janitorial services. He testified that he was engaged as a limited partner in the business known as Carpet Gallery of Austin and that he knew nothing of the carpet business in general and very little about this particular business. He thought that Nick sold and installed carpet in homes and apartment houses. He wasn’t sure whether it was largely a subcontracting business. He did not know how many employees worked at the premises. He thought the business was located at 1924 South First Street. No inventory of carpet was maintained at that office and he didn’t know whether an inventory was maintained at any other location. A written partnership agreement was prepared by attorneys selected by Nick Voudouris. Johnny identified a copy of the written agreement which was introduced by the plaintiff as Exhibit # 12. Johnny contributed capital to the partnership by cosigning a promissory note with Nick. Johnny had to pay off the loan to the bank. He did not participate in the day by day operation of the business and did not have access to the books and records of this business. When he found out that Nick was not paying his bills, he immediately told him that he did not want to be involved in something that wasn’t being taken care of and that he didn’t to be involved with him at all under any conditions. He then secured a list, of creditors from Nick and wrote letters to each creditor informing them that he had sold his'interest to Nick Voudouris and was no longer liable on any past or future indebtedness. A copy of this letter was introduced into evidence by the plaintiff and bears the date May 6,1974. Johnny’s secretary informed him that people had been calling. Johnny then began investigating and discovered that Nick had used a copy of his financial statement in establishing credit with the plaintiff and others. Johnny testified that he had no letterheads and that the letters were typed on plain paper and his secretary had apparently secured envelopes bearing the logo of Carpet Gallery of Austin from Nick and mailed the letters to the creditors in them. He testified that he did not file the limited partnership agreement with the Secretary of State and did not pay any filing fees. He left all of that to Nick and he assumed Nick had filed it. He did not check to see if in fact it had been filed with the Secretary of State.

With the case in this posture the plaintiffs introduced some testimony relating to attorney’s fees and rested. At that time the defendant moved for judgment on the ground that the plaintiff had not shown that Johnny Voudouris was anything other than a limited partner in the operation of the business. At that time the attorney for the defendant announced to the court his contention that the duty to file the limited partnership certificate was on the general partner and that in the event it was not filed, the limited partner had the right to renounce his interest in the limited partnership. Counsel stated that Mr. Voudouris did renounce his interest and that the facts show that he was not responsible for the debts. Following this statement an unreported discussion on the law was held between the court and counsel after which motion for judgment was denied.

In answers to questions from his own counsel Johnny Voudouris testified that Nick Voudouris came to him for assistance in getting the carpet business started. Nick told him that he was unable to borrow money from the bank unless Johnny would co-sign a note for him. He did co-sign the note and required Nick to draw the papers up because he did not want to be involved and wanted no responsibility for the business. He testified that he was strictly an investor. He had never been involved in any other transaction with Nick. He did not give his financial statement to Nick or make it available to him and had no idea how he got it. He testified that after he learned that Nick had not been paying his bills he demanded a release of liability and that Nick signed one in return for his interest in the business. The written indemnification agreement was introduced into evidence then. He did not take an active role in the operation of Carpet Gallery at anytime and never intended to take an active role. When he found out in May of 1974 that Nick was representing that he, Johnny, was interested in the business he renounced the partnership within a week and entered into the indemnity agreement with Nick.

The indemnification agreement bears the date May 6, 1974 and recites the formation of a limited partnership agreement and the dissolution of said agreement.

Article 6132a, Vernon’s Annotated Civil Statutes, entitled, Uniform Limited Partnership Act, provides in Section 2 thereof:

“A limited partnership is a partnership formed by two or more persons under the provisions of section 3 of this Act and having as members one or more general partners and one or more limited partners. The limited partner as such shall not be bound by the obligations of the partnership.”

Section 3 of the Act requires that the persons desiring to form a limited partnership sign and swear to a certificate stating certain specified information and file for record the certificate in the office of the Secretary of State accompanied by the payment of the filing fee.

Section 8 of the Act provides:

“A limited partner shall not become liable as a general partner unless, in addition to the exercise of his rights and powers as a limited partner, he takes part in the control of the business.”

Section 12 of the Act provides:

“A person who has contributed to the capital of a business conducted by a person or partnership erroneously believing that he has become a limited partner in a limited partnership, is not, by reason of his exercise of the right of a limited partner, a general partner with the person or in the partnership carrying on the business, or bound by the obligations of such person or partnership; provided that on ascertaining the mistake he promptly renounces his interest in the profits of the business, or other compensation by way of income.”

Section 28 of the Act provides:

“(a) The rule that statutes in derogation of the common law are to be strictly construed shall have no application to this Act.
(b) This Act shall be so interpreted and construed as to effect its general purpose to make uniform the law of those states which enact it.”

The case was tried to the court without a jury. No findings of fact or conclusions of law were filed. Under such circumstances we must presume findings of facts having support in evidence which will support the judgment rendered by the trial court. The rules for determining the existence of a partnership are set out in Section 7 of Article 6132b, Vernon’s Annotated Civil Statutes providing:

“(1) Except as provided by Section 16 persons who are not partners as to each other are not partners as to third persons.”
(2) . . .
(3) The sharing of gross returns does no1 of itself establish a partnership, whether or not the persons sharing them have a joint or common right or interest in any property from which the returns are derived.
(4) The receipt by a person of a share of the profits of a business is prima facie evidence that he is a partner in the business . . .”

A comment by Alan R. Bromberg is found in Vernon’s Annotated Civil Statutes under Section 7, Art. 6132b. He states that paragraphs (1)(2)(4) are the same as in the national act. The comment states that paragraph (1) is highly important because of the frequent attempts of third persons to charge one person with obligations incurred by another on the theory that they are partners. Some Texas cases are more willing to find a partnership as to third persons than among the alleged partners. However the better view has considered only arrangements between the partners unless some holding out creates an estoppel. Mr. Bromberg concludes that this view is the rule promulgated by paragraph (1), for Section 16 deals with estoppel.

There is no evidence in this record from which an inference could be drawn that Johnny Voudouris and Nick Voudouris were general partners as to each other. Walter E. Heller & Company stipulated that Johnny Voudouris made no representations which induced them to extend credit and that there was no basis upon which that company could raise an estoppel. There is no evidence that the business made a profit or that Johnny Voudouris received any share of the profits of the business. The burden was upon the plaintiff to establish a partnership between Johnny Vou-douris and Nick Voudouris. There is no evidence that Johnny Voudouris had the right to operate the business as a co-owner. There is no evidence that he had a right to direct the operation of the business. There is no evidence that he had a right to contract on behalf of the business.

The plaintiff introduced the limited partnership agreement. This agreement begins with a paragraph reading:

“Pursuant to the provisions of the Texas Uniform Limited Partnership Act, V.A. T.S. Art. 6132a, the undersigned persons certify that the statements hereinafter made and contained herein are provisions of an agreement for a limited partnership to be effective when filed with the Secretary of the State of Texas.”

It recites that Johnny Voudouris, a limited partner, contributed the amount of $9,500.00 and owned a capital interest of 20%. It provides that Johnny Voudouris as a limited partner would be entitled to a 20% share of the profits of the business.

In Gevinson v. Manhattan Constr. Co., 449 S.W.2d 458 (Tex.1969) the court said:

“It has been said that one who introduces a document vouches for its accuracy and will not be allowed to impeach or contradict its recitals. This rule can avail plaintiffs nothing, because it has been largely engulfed by its own exceptions. In analogy to the rule that a party may prove the truth of particular facts in direct contradiction of the testimony of his witness, he may also disprove factual recitals in a document introduced by him.”

The limited partnership agreement evidences the fact that Johnny Voudouris agreed to become a limited partner and contributed $9,500.00 to the capital of the business. It further recites that Nick Voudouris is a general partner. While these recitations are not established to the extent that they cannot be contradicted by other evidence, there is no evidence to contradict these recitations. While the limited partnership agreement never became effective according to its terms because it was never filed with the Secretary of State, it does illuminate the intent of the parties. Whether a particular association is in fact a partnership depends largely on the intention or understanding of the parties involved. They must ordinarily agree and intend to become partners. Luling Oil & Gas Co. v. Humble Oil & Refining Co., 144 Tex. 475, 191 S.W.2d 716 (1945).

An indication of the interpretation to be given Section 12 of the Limited Partnership Act is found in United States v. Coson, 286 F.2d 453 (9th Cir. 1961), where the court construed Section 11 of the Uniform Act which is identical to Section 12. The court quoted from Giles v. Vette, 263 U.S. 553, 44 S.Ct. 157, 161, 68 L.Ed. 441, where the Supreme Court said:

“Section 11 is broad and highly remedial. The existence of a partnership — limited or general — is not essential in order that it shall apply. The language is comprehensive, and covers all eases where one has contributed to the capital of a business conducted by a partnership or person erroneously believing that he is a limited partner. It ought to be construed liberally, and with appropriate regard for the legislative purpose to relieve from the strictness of the earliest statutes and decisions.”

In a footnote the court said:

“Of course an intent to become a general partner may be inferred from conduct. In this case no such conduct was shown. Coulson had nothing to do with management of Moulin Rouge, or with its organization. The only conduct shown on his part was consistent solely with his belief that he was dealing with a limited partnership. The ancient rule that failure to comply with statutory provisions required to form a limited partnership renders the association a general partnership, vanished with the enactment of Uniform Limited Partnership Act. As stated in the Commissioners’ note on the act: “Third: The limited partner not being in any sense a principal in the business, failure to comply with the requirements of the act in respect to the certificate, while it may result in the nonformation of an association, does not make him a partner or liable as such. The exact nature of his liability in such cases is set forth in Section 11.”

, The 9th Circuit went on to hold that it was not important whether the renunciation operated to relieve Coson from liability ab initio or whether it operated to compel a finding that Coson was not a general partner at any time, first because he never had the necessary intent to join a partnership in that capacity, and second because his renunciation under Section 11 was fully effective.

Here we find that the limited partnership failed to become effective because it was not filed with the Secretary of State. There is testimony from the defendant that immediately upon learning that the partnership agreement had not been filed he renounced the partnership. This testimony is supported by documentary evidence.

The general rule is that evidence given by an interested witness, even though uncontradicted, presents an issue to be determined by the trier of fact. This rule is not without exception, however, and conclusive effect may be given to the testimony of an interested witness provided that the testimony is clear, direct and positive and there are no circumstances tending to discredit or impeach the same.

There is added reason for recognizing the exception when the party has the means and opportunity of disproving the testimony, if it were not true, and failed to do so. On the other hand the basis for recognizing an exception is weakened somewhat when the testimony is such that it could not readily be contradicted if untrue. Gevinson v. Manhattan Constr. Co., supra.

Nick Voudouris furnished a copy of Johnny Voudouris’ financial statement to the plaintiff. The letter which Johnny Voudouris sent to Walter E. Heller & Company informing them that he had sold his interest and limited partnership to Nick Voudouris was mailed in an envelope bearing the logo of Carpet Gallery of Austin. Johnny Voudouris executed an instrument purporting to establish a limited partnership with Nick Voudouris under the name Carpet Gallery of Austin. He co-signed a note with Nick Voudouris to secure funds for the business. These are the only circumstances in evidence which tend to support the finding of the trial court that Johnny Voudouris was a general partner with Nick Voudouris in the business. The failure to file the limited partnership agreement with the Secretary of State did not result in the formation of a general partnership. It was stipulated that there was no basis for a finding of partnership by estoppel. The remaining circumstances are legally insufficient as a basis for a finding that the formation of a general partnership between Johnny and Nick Voudouris was intended by the partners. Giles v. Vette, supra; United States v. Coson, supra; J. G. Wattenbarger & Sons v. Sanders, 216 Cal.App.2d 495, 30 Cal.Rptr. 910 (5th Dist. Cal. 1963).

Appellant’s testimony that he intended to enter a limited partnership, took no part in the management of the enterprise, and gave up his interest therein soon after his discovery that the partnership agreement had never been filed with the Secretary of State was clear and positive. There are no circumstances tending to impeach his testimony. This evidence must be accepted, and Section 12 of the Limited Partnership Act prevents the imposition of liability on Johnny Voudouris for the debts of Carpet Gallery of Austin, Ltd.

The judgment of the trial court is reversed and judgment is here rendered that Walter E. Heller & Company take nothing.


text:
    SECURITY TITLE & TRUST COMPANY, Appellant, v. TOWER LAND & INVESTMENT COMPANY, Appellee.
    No. 19389.
    Court of Civil Appeals of Texas, Dallas.
    Dec. 27, 1977.

      Edward J. Drake, Brady, Drake & Wilson, Dallas, for appellant.
    H. Dee Johnson, Jr., Johnson & Cravens, Dallas, for appellee.
   GUITTARD, Chief Justice.

The party insured by a contract of title insurance brought this suit against the insurer for expenses incurred in defending a suit for an undivided interest in the property covered by the contract. The insurer had refused to defend the earlier suit on the ground that it was a type of suit excluded from coverage by the terms of the contract. In the cause now on appeal, the trial court, sitting without a jury, rendered judgment for the insured. We affirm.

The contract in question guarantees to the insured “good and indefeasible title” to a certain tract of land and states the extent of the insurer’s liability as follows:

Said Company shall not be liable in a greater amount than actual monetary loss of assured, and in no event shall said Company be liable for more than EIGHTY NINE THOUSAND AND NO/100_($89,000.00)_DOL-LARS, and shall, at its own cost, defend said assured in every suit or proceeding on any claim against or right to said land, or any part thereof, adverse to the title hereby guaranteed .

The particular exclusion relied on by the insurer is as follows:

Nothing contained in this policy shall be construed as insuring against loss or damage by reason of fraud on the part of the assured; or by reason of claims arising under any obligation of the assured; or under any act, thing, or trust relationship, done created, suffered or permitted by the assured.

The suit which the insurer refused to defend was brought against the insured, Tower Land & Investment Company, by Sarah Ballard Hall in a United States district court. Hall alleged in her amended complaint, on which that suit was tried, that she was the owner of an undivided one-half interest in the land in question, that on October 30, 1964, her father, purporting to act as her “custodian,” executed a quitclaim deed to Coffee Cups, Inc. purporting to divest her of her interest, that she was then a minor whose disabilities had not been removed, and that her father had no legal capacity to divest her of ownership or to transfer her title. The complaint further alleges:

Defendant, acting by and through its agent, employee, officer and shareholder, R. B. Payne, knew that Plaintiff was a minor whose disabilities had not been removed. Defendant further knew, or in the exercise of common business judgment and care, should have known, that G. E. Hall did not have the legal capacity to divest Plaintiff of her ownership in and to real property, and particularly the subject property, or to transfer her title therein to third persons. Defendant further knew of Plaintiff’s interest in the subject property when Defendant acquired its interest therein.

The complaint, prays for judgment establishing Hall’s undivided one-half interest in the property, removing Tower’s claim as a cloud on that interest, and voiding any and all conveyances and instruments which would operate to divest her of her interest.

After the insurer refused to defend Hall’s suit, the insured employed its own counsel, who made a successful defense. The expenses of that defense are claimed in the present action.

The insurer contends that Hall’s suit was within the exclusion because it was based either on fraud by Tower or its agents or breach of some obligation by Tower. It insists that Hall never owned any interest in the property, but only owned stock in Coffee Cups, Inc., which had conveyed the property to Tower, and that her claims “were brought either on theories of a fraudulently or collusively induced sale to Tower by Tower and/or agents, that Tower had some obligation to fulfill, has breached such obligation or that Miss Hall’s minority had prevented the transfer in some way — a fact that was known or should have been known by Tower.” The insurer points out that the present record shows Hall’s suit to be the second of two suits brought by her against Tower, that in the first suit, which the insurer defended under a reservation of rights, Hall had expressly alleged fraud and violation of a fiduciary obligation, and that the second suit was finally disposed of on appeal on the ground that the first judgment was res judicata, the appellate court expressly holding that both suits were “based on the same cause of action.” That decision is reported as Hall v. Tower Land & Investment Company, 512 F.2d 481 (5th Cir. 1975). Thus, the insurer argues, the record shows that both of Hall’s suits were within the exclusion.

We cannot agree with this argument because we find that the amended complaint, on which Hall’s second suit was tried, states a claim of title independent of any allegation of fraud or breach of obligation. The gist of the amended complaint is that Hall owned an undivided half interest, that her father, purporting to act as her “custodian,” attempted to convey that interest to Coffee Cups, Inc. but “did not have the legal capacity” to divest her of her interest or to transfer her title to third persons, and that Tower or its agents “knew or should have known” of her father’s lack of capacity when it acquired its interest. Entirely apart from the allegation of what Tower’s agents “knew or should have known,” the facts alleged in the complaint, if established by proof, would have supported a judgment for Hall, since if she had owned an undivided interest and Tower was claiming under a deed from a “custodian” who had no authority to make a conveyance, she would be entitled to recover her interest, regardless of whether Tower had notice of any lack of authority of the “custodian” to make the conveyance. Stripped of superfluous verbiage, Hall’s claim is simply a claim of record title rather than a claim based on fraud by the insured or on breach of any obligation to the claimant. Therefore, her suit was within the general obligation assumed by the insurer in the contract to defend the insured against claims adverse to the insured title.

The disposition of the second suit on the ground of res judicata does not affect the obligation of the insurer because, regardless of Hall’s allegation of fraud and breach of fiduciary obligation in the first suit, the rule is settled that the obligation of an insurer to defend must be determined from allegations of the pleading when considered in light of the provisions of the insurance contract, without reference to the truth or falsity of such allegations, or the claimant’s ultimate right of recovery. Argonaut Southwest Ins. Co. v. Maupin, 500 S.W.2d 633, 635 (Tex.1973). Under this rule, the evidence in the second suit is also immaterial. Neither do the allegations of the original complaint in the second suit affect the obligations of the insurer, since, in determining the question of coverage, the contents of earlier, superseded pleadings cannot be considered. General Ins. Corp. v. Harris, 327 S.W.2d 651, 655 (Tex.Civ.App.-Dallas 1959, no writ).

Although the allegations of Hall’s amended complaint, with its apparently superfluous allegations of what Tower’s agents “knew or should have known,” may raise some uncertainty as to the true basis of her claim of title, there is at least doubt as to whether this pleading would support recovery on simple proof of a record legal title to an undivided half interest, of which she had not been divested by any conveyance to Tower or those through whom it claimed. In determining the obligation of an insurer to defend, any doubt as to whether the pleading, in the suit against the insured, states a claim within the coverage of the insurance contract must be resolved in favor of the insured. Heyden Newport Chemical Corp. v. Southern General Ins. Co., 387 S.W.2d 22, 26 (Tex.1965).

Since we hold that Hall’s claim as alleged in her amended complaints was not within the exclusion relied on by the insurer, we express no opinion on the contention of the insured that the exclusion does not apply to the insurer’s obligation to defend, as distinguished from its obligation to pay for “actual monetary loss.”

Affirmed.