author: mcclendon, o. j.

text:
    PFEUFFER et al. v. HAAS et al.
    No. 7724.
    Court of Civil Appeals of Texas. Austin.
    Nov. 23, 1932.
    Rehearing Denied Dec. 14, 1932.

      Prank B. Yoigt, of New Braunfels, and Neil E. Beaton, of San Antonio, for appellants.
    I-Ienne & Puchs, of New Braunfels, for ap-pellees.
   mcclendon, o. j.

Ernest Haas and Emma Haas (husband and wife) sued Thekla Pfeuffer, individually and as surviving partner of George Pfeuffer Lumber Company, Pred Pfeuffer as independent executor of the estate of U. S. Pfeuffer, deceased, and Tug S. Pfeuffer, to cancel (1) a deed to real estate, the separate property of Emma Haas and the family homestead; and (2) a note and contract executed by Ernest Haas, on the ground of duress predicated upon threats of criminal prosecution of Ernest Haas on the charge of embezzling funds of the lumber company while in its employ as bookkeeper and assistant manager.

Defendants counterclaimed (1) seeking removal of cloud from their title to' the real estate; and asserting (2) an equitable lien upon the property to the extent of $3,815.06, ■the amount of the misappropriated funds alleged'to have been applied by Haas in discharge of a trust deed lien upon the property, and $1,113.40 paid out by defendants subsequently to the execution of the Haas deed upon the trust deed lien and taxes; and (3) a claim of $1,140, rental of the premises since execution of the Haas deed. Erom a judgment in favor of plaintiffs granting the relief prayed for and awarding defendants recovery upon their counterclaim for the amounts paid by them subsequently to the execution of the Haas deed, defendants have appealed, and plaintiffs have cross-assigned error upon defendants’ recovery upon their counterclaim.

The record will support both as a matter of law and factually the following controlling facts which are stated only in broad outline:

George Pfeuffer Lumber Company was a copartnership composed of U. S. and S. V. Pfeuffer, who were brothers. S. Y. Pfeuffer died in August, 1928, and Thekla Pfeuffer, his widow and independent executrix, continued as a member of the firm, and the business was conducted in the same way as prior to the death of her husband, until the death of U. S. Pfeuffer, in December, 1929. Ernest Haas was employed by the firm as bookkeeper, with general duties of assistant manager, from about 1917 until March, 1930. U. S. Pfeuffer occupied the position of managing partner at least to the extent of dealings between the firm and its employees. Whatever participation S. V. Pfeuffer exercised in the firm’s business appears to have been through conferences with U. S. Pfeuffer. The testimony shows a rather unusual method of dealings between the firm and Haas and another employee, Mergele, in that the personal bills and accounts of these employees were paid by the firm and charged to them on the firm’s books as bills receivable. For at least several years prior to December, 1929, the salaries of these two employees were not paid by check, but were merely entered as credits on their accounts. Both'Haas and Mergele had authority to draw checks upon the firm account. In a number of instances checks in payment of accounts or indebtedness of Haas and Mergele were signed by U. S. Pfeuffer, who the evidence showed had knowledge of and consented to this course of business. After the death of O. V. Pfeuffer, Mrs. Thekla Pfeuffer took no active part in the business of the firm, but appears to have been represented by her son, Fred Pfeuffer. U. S. Pfeuf-fer continued as managing partner to the same extent as before, consulting at times with Fred Pfeuffer, who claims not to have had any knowledge of the indebtedness of Haas and Mergele until shortly after the death of U. S. Pfeuffer (whose independent executor lie became). Thereupon he employed one Gilligan, an accountant of San Antonio, to audit the books of the firm, and upon the completion of this audit in March, 1930, the indebtedness of Haas was adjusted in the following manner: Haas executed an agreement acknowledging that he had overdrawn his account in the sum of $17,568.52; and agreed that he and his wife would convey the homestead property for a consideration of $7,000, to be applied as a credit upon his .indebtedness ; and that he would execute a note to be' joined in by his wife for $10,568.52, payable on or before ten years from date without interest, to secure which he would deposit four insurance policies upon his life for the aggregate amount of $13,000. This agreement was dated March 13, 1930. On the same day he and his wife executed the deed to the homestead property.

Since we are reversing the trial court’s judgment on account of improper argument of plaintiffs’ counsel, we refrain from a detailed statement of or comment upon the evidence upon the issue of duress, which is amply supported as to both spouses, both as a matter of law and factually.

The court submitted five special issues of its own, and three, Nos. 04, D5, and D6, requested by defendants. These and the jury’s answers thereto follow:

“1. Do you believe from the preponderance of evidence that the funds of George Pfeuffer Lumber Company which the account of 0. H. Haas on the books of said company shows were applied to payment of the costs of improvement of the Haas’ property, were so applied with the knowledge and consent of U. S. Pfeuffer, the then managing partner of said Lumber Company?” Answer: “Yes.”
“2. Do you believe from the preponderance of evidence that it was understood and agreed between E. H. Haas and U. S. Pfeuf-fer, acting for the Lumber Company, that the sums of money represented by the Account of E. H. Haas on the books of the Lumber Company would eventually be charged off the books of said Company?” Answer: “Yes.”
“3. Do you believe from the preponderance of evidence that the execution by E. H. Haas of the contract and deed of date March 13th, 1930, was induced and procured by threats of criminal prosecution for embezzlement?” Answer: “Yes.”
“4. Do you believe from the preponderance of evidence that the execution by Mrs. Emma Haas of the deed of March 13th, 1930, was induced and procured by threats of criminal prosecution for embezzlement against her' husband?” Answer: “Yes.”
“5. Do you believe from the preponderance of evidence that the execution by Mrs. Emma Haas of the deed of March 13th, 1930, was induced and procured by representations upon the párt of Fred Pfeuffer, acting for said Lumber Company, that said deed would not act as a deed of conveyance to her interest in the property described therein?” Answer: “Yes.”
“D4. Do you believe from the preponderance of the evidence that the contract made by E. H. Haas, dated March 13th, 1930, and the deed dated the same day, were made in consideration of the agreement of Fred Pfeuf-fer not to prosecute E. H. Haas upon a dharge of' embezzlement from George Pfeuffer Lumber Company?” Answer: “Yes.”
“D5. Do you believe from the preponderance of the evidence that at the time of actually signing the deed, E. H. Haas was in such fear of .criminal prosecution for embezzlement that he was completely deprived of the free exercise of his will power?” Answer: “Yes.”
“D6. Do you believe from the preponderance of the evidence that at the time of actually signing the* deed, Emma Haas was in such fear of her husband, E. H. Haas, being criminally prosecuted for embezzlement that she was completely deprived of her will power?” Answer: “Yes.”

By their first proposition appellants contend that they were entitled to judgment as a matter of law, because the evidence conclusively showed that Haas had embezzled partnership funds and applied them to the discharge of the trust deed lien upon the homestead property. It is contended in this connection that Mrs. Haas, whether or not she knew of such embezzlement and application, could not assert a homestead right in the property as against the claim of defendants.

As we have stated above, the evidence was sufficient to support the finding of the jury that U. S. Pfeuffer was cognizant of and consented to the overdrafts. This fact would, in our judgment, negative any criminal offense on Haas’ part. Absent an express statute making it so, a partner cannot be guilty of embezzling partnership funds. See Culp v. Robey (Tex. Civ. App.) 294 S. W. 647; reversed (Tex. Com. App.) 299 S. W. 846, but upon other grounds.

This holding is predicated upon the partner’s ownership of an undivided interest in all partnership property. And since a third party could not be guilty of embezzling the interest of a consenting partner, by parity of reasoning such consent would extend to the entire ownership of the property.

However, a partner does occupy such fiduciary relationship to partnership funds as to raise a constructive trust in favor - of the other partners in any property into which they may trace partnership funds which he has misappropriated. Smith v. Green (Tex. Civ. App.) 243 S. W. 1006 (error refused); First State Bank v. Zelesky (Tex. Civ. App.) 262 S. W. 190.

This right of reimbursement is predicated upon a wrongful act which gives rise to a constructive trust. The same rule would apply to an employee who fraudulently appropriates partnership funds, even though with the consent of one of the partners.

To amount tó a fraudulent misappropriation on the part of an employee, he must either have known of the want of authority in the consenting partner, or must have been charged in law with knowledge thereof.

It is not contended by appellants that there was any collusion between U. S. Pfeuf-fer and Haas; nor that there was any fraudulent or wrongful act on the former’s part in giving his consent to the overdrafts. Their contention is that even conceding the knowledge and consent of U. S. Pfeuffer, he did not have the apparent authority to bind the other partners therein so as to relieve the action of Haas of its fraudulent or wrongful character. In this we do not concur. Whether or not the evidence warranted the conclusion that U. S. Pfeuffer occupied the position of managing partner generally, it amply warranted the conclusion that he occupied such position as regards Haas and Mergele. As above stated, the course of business under which tbe large overdrafts were allowed to accumulate was very .flnusual; it had, however, extended over quite a period of years; and there was no element of concealment on the part of Haas. His entire course of conduct in the matter was open and above board, and each transaction was carried in detail upon the books of the company, of which U. S. Pfeuffer must have had knowledge. This latter conclusion would be a reasonable one independently of the affirmative testimony of such knowledge and his express consent thereto. It was at least a jury question whether under the circumstances Haas was warranted in assuming that U. S. Pfeuffer had authority to do what the evidence showed that he did. If he had such authority, either actual or apparent, the overdrafts would not constitute fraudulent misappropriation or other wrongful act which is essential to the raising of a constructive trust. The overdrafts in such event would merely constitute a simple debt owing by Haas to the partnership.

In the absence of authority, actual or apparent, in U. S. Pfeuffer to bind the partnership, the nonconsenting partners would be subrogated to tbe rights of the trust deed lienholder to the extent of their interest in the partnership funds which were wrongfully used in discharging that debt.

The submission of the second special issue was objected to for a number of reasons. We need only consider one of these, which we sustain, namely, that the promise (alleged and supported by evidence) of U. S. Pfeuffer to charge off or take care of the overdraft of Haas was unsupported by any consideration, and merely amounted to a promise to make a gift at some future time. Such promise was unenforceable even against tbe promisor, and it was immaterial whether he had authority to bind tbe partnership therein.

It is urged that special issues 3 and 4 are defective in that they do not include Haas’ innocence of the crime of embezzle.ment as a necessary element to actionable duress.

In so far as Haas is concerned, there are two lines of authority upon this subject. One line, referred to in Ruling Case Law (volume 9, pp. 119, 120) as being “supported it is believed by the better reasoning,” and by Chief Justice Fly (Sabinal State Bank v. Ebell [Tex. Civ. App.] 294 S. W. 226, 227) as tbe “modern doctrine,” is to the effect that to constitute duress “the threatened prosecution need not he for a crime or offense of which the party threatened is not guilty.” For a full discussion of the two doctrines, the respective reasons upon which they are supported, and authorities thereon, see Houston lee & Brewing Co. v. Harlan (Tex. Com. App.) 228 S. W. 1090, 1091; 10 Texas Jurisprudence, pp. 81-83, § 47; and notes in 26 L. R. A. page 48, 20 L. R. A. (N. S.) page 484, and 17 A. L. R. 325, et seq. We adhere to the rule announced by Chief Justice Ely, and overrule this contention of appellants.

As regards Mrs. Haas, the situation presented is brought within the following well-recognized exception to the doctrine contrary to that above adhered to:

“Where the purpose and effect of the threat is to obtain a payment or other pecuniary advantage from a near relative of the party threatened. 9 R. C. L. 727. This doctrine has been uniformly followed whenever the question has been presented to onr Courts of Civil Appeals. Gray v. Freeman, 37 Tex. Civ. App. 556, 84 S. W. 1105, 1106; Medearis v. Granberry, 38 Tex. Civ. App. 187, 84 S. W, 1070; Shriver v. McCann (Tex. Civ. App.) 155 S. W. 317, 320 ; Burnett v. Bank, etc. (Tex. Civ. App.) 191 S. W. 172.
“ ‘In such cases the fact that the threatened prosecution or imprisonment may be lawful does not affect the voidability of the contract, nor is actual guilt or innocence of the accused material.’ 13 C. J. 404.
“It is said in some cases that the relief sought in the character of cases last cited falls more properly under the head of undue influence, but tbe distinction seems to us immaterial.” Houston Ice & Brewing Co. v. Harlan, supra.

See, also, Robertson v. Shinn Grocery Co. (Tex. Civ. App.) 34 S.W.(2d) 367 (error ref.).

Appellants further contend that ap-pellees are barred from affirmative relief on the ground that the evidence supporting duress also shows that the transaction was tainted with illegality, in that it embodied an agreement to compound a crime. In Prim v. Farmers’ Nat. Bank (Tex. Com. App.) 44 S.W.(2d) 943, it was held that a threat to prosecute, unless an indebtedness owed by the threatened party was “fixed up,” necessarily implied an offer not to prosecute, which if accepted would constitute an illegal agreement, so far as concerns the party making the threat. There is some authority for the proposition that duress may not be urged where there is an agreement not to prosecute. But by far the weight of authority and to our mind the better reasoning are to the contrary. This latter view is sometimes rested upon the proposition that the parties are not in pari delicto. But independently of this view, we think illegality of the consideration of the contract in so far as concerns the threatened party is rendered immaterial by the fact ■that duress connotes overpowering the free will, and therefore excludes a necessary element of a valid contract (meeting of the minds of the parties). Estoppel predicated upon the illegality of a contract should not be available against one whose assent thereto has been procured by duress and is therefore in law no assent.

Some time after the jury had retired, they propounded to the judge the following question in writing: “Would like to get a little information regarding Request issue No. 5 beginning at the word completely deprived of the free exercise of his will power.” To which the judge replied, also in writing: “By the terms ‘that he was completely deprived of the free exercise of his will power’ is meant: To constitute duress the influence exerted must be of such a character as to destroy the free agency of the party influenced, and must overcome his will and cause him to do that which he would not otherwise do.”

It does not appear that this reply was submitted to counsel before delivery to the jury. It was assigned as error in appellants’ motion for new trial upon objection therein alleged to have been “duly and timely made,” upon the ground in substance that it did not truly answer the jury’s inquiry in that it substituted “the signing of said deed as a matter of expediency” for “the entire element of deprivation of free will.” We do not think the language employed can be -fairly given this interpretation. It is a literal copy of the definition given in 10 Tex. Jur. p. 41, which is an accurate deduction from the authorities there cited. It might be better to omit from the court’s definition the words “to constitute duress,” and substitute therefor, “that,” and to insert “thereby” between “and” and “cause him.” Whether the record shows that the objection was seasonably urged, and if so whether the ground of objection was sufficiently clear to raise this issue, we find it unnecessary to decide. Since this was a part of the court’s charge to the jury, proper practice required that it be submitted to counsel for their objections before delivery to the jury. Objections not so made may not be urged on appeal.

Counsel for plaintiffs, in his closing argument to the jury, used the following language, not objected to at the time, but assigned as error in the motion for new trial and in this court:

“Haas possibly was not as careful as he should have been, but he is entitled to have his home free from debt. I have appeared in many cases during my twenty-four years of practice, but I never appeared in any case where I have been more interested than in the case of these two people defending their home. He is in hard circumstances and it will be hard for him to find work this winter. You can throw him out if you want to, but our forefathers wrote in the Constitution of this State the homestead law. If a man lives in the country he is entitled to 200 acres free of debt; if he lives in the city he is entitled to a home free of debt. They recognized that the homeowners make the nation. They are entitled to a home where they can go free and undisturbed by the law —a haven of rest where they can live and die.
“The Court: Gentlemen of the Jury, you are to consider only such arguments as bears upon the testimony from the witness stand.
“You can turn them out in the streets if you want to, but I am not going to be a party to it; I am not going to be responsible for it.
“You can take their home from them, but I am not going to assume the responsibility. They sold these notes to somebody else, they got their money.
“You can take their home from them. That is what it would mean to them. One of the greatest men that the United States-ever produced made the statement: ‘It is not necessary to be rich in order to be happy; the laughter of a child will brighten.’ Will there be any laughter in and about this home if you take it away from them? Their laughter will be turned into tears and cries of the children.
“In answering these questions, you might at least go to your homes or the homes of your parents — maybe some of you now live in the homes where you were bom — and there by the fireside of that old home, write your verdict in harmony with that old song, ‘Home, Sweet Home, be it ever so humble, there is no place like home,’ and we will be satisfied.”

This argument was manifestly improper as placing upon the jury the responsibility of depriving plaintiffs of their home, and appealing to them to give their answers to the issues accordingly, regardless of what they might believe to be the true answers to the issues, based upon the evidence. This character of argument has been repeatedly condemned by our appellate courts. In a recent case, virtually on all fours with the case at bar, as regards this particular question we said: “There have been a number of recent decisions by the Commission of Appeals upon the subject of improper argument of counsel. From these the general rule may be deduced that, where the case is one in which the situation of one of the parties is such as to appeal to the sympathy of men of normal emotions, and the argument is such as to excite such sympathy to action, the judgment will be reversed, even though the jury may be instructed to disregard the argument, unless it can be said, from an examination of the entire record, that all reasonable doubt as to the deleterious effect of the argument has been removed.” Barnes v. McCulloch (Tex. Civ. App.) 53 S.W.(2d) 89, 90. The quoted argument clearly, we think, falls with this rule.

The recent case of Lane v. Cunningham (Tex. Civ. App.) 38 S.W.(2d) 906, 909 (now pending in the Supreme Court on writ of error granted), is cited as holding that argument of this character is not “so vicious and prejudicial in its nature as that the effect thereof, if any, upon the jury, was not removed by the court’s instruction” not to consider it. It is to be observed that the main holding upon which the court rested its decision was that “the bill of exceptions * * * does not disclose, either that there was no evidence to justify the argument, or that there was no argument on the part of the opposing counsel to provoke it.”

Whatever 'may have been the situation in Lane v. Cunningham, we cannot conceive of any character of evidence which would justify the argument in the instant case, nor can we visualize any argument of opposing counsel to which it would constitute a legitimate reply. Bills of exceptions are required to be presented to opposing counsel before they are approved by the judge. If upon their face they present prejudicial error, ample means are afforded to embody in the record such matters as may remove or mollify its deleterious effects. The record on appeal is supposed to embody everything material to the questions presented for review. The right to such review should not be defeated or impaired by the mere surmise or possibility that something as to which the record is silent might have occurred which would render the adverse ruling innocuous.

The quoted argument falls, we think, within that class as to which instruction not to consider is held not reasonably calculated to remove the harm already done. It is to be noted that after the court directed the jury “to consider only such arguments as bear upon the testimony from the witness stand,” the same argument was reiterated a number of times, which was not the case in Lane v. Cunningham.

The points urged in the cross-assignments need not arise upon another trial, hence their consideration is unimportant.

The trial court’s judgment is reversed, and the cause remanded for a new trial.

Reversed and remanded.

On Appellees’ Motion for Rehearing.

The motion assigns error in reversing the judgment on account of improper argument of counsel urging that “there was sufficient evidence to justify it, or at least to render it harmless.” Humphreys v. Roberson (Tex. Civ. App.) 52 S.W.(2d) 932, is cited and quoted from at length in support of the assignment. The general principles announced in that case are of unquestioned soundness; but they are clearly not applicable here.

The further point is made that admissions of appellants rendered them “guilty of duress as a matter of law,” and therefore a directed verdict would have been proper. It may be that the evidence as a matter of law establishes the threats; in any event, the evidence upon this point was very strong. But threats alone do not constitute duress. To do so they must overcome the free will of the party threatened. Upon this fact issue there was a sharp conflict in the evidence ; and without invading the province of the jury, we could not reach a reasonable conclusion as to where the preponderance of evidence lay.

It is true, as pointed out in the motion, that the writ of error was not granted in Lane v. Cunningham upon the argument of counsel. That point was not urged in the application. We do not question the correctness of the conclusion in that case that the argument probably had no deleterious effect, under all the circumstances there presented. As pointed out in our original opinion, we have an entirely different situation here, as to which the holding there is not in point.

We did, however, disagree with -the holding in that ease to the effect that the bill of exceptions must disclose “either that there was no evidence to justify the argument, or that there was no argument on the part of the opposing counsel to provoke it.” In this we are supported by the opinion (published after our decision was announced) in West Texas Utilities Co. v. Renner, 53 S.W. (2d) 451, 455, in which Judge Ryan, writing for Section B of the Commission of Appeals, says: “In Texas Indemnity [Ins.] Co. v. McCurry (Tex. Com. App.) 41 S.W.(2d) 215, 217, 78 A. L. R. 760, it was lield tliat a bill of exceptions to improper argument is not required to negative any possible fact or state of attending circumstances that would render the objectionable matter without prejudicial effect. It was there stated: ‘The rule ⅛ now settled in this state that, where improper argument has been indulged in, the adverse complaining party is entitled to reversal of the judgment, as a matter of law, if under all the circumstances there is any reasonable doubt of its harmful effect, or unless it affirmatively appears no prejudice! resulted. [Citing numerous authorities.]”

The motion is overruled.

Overruled.


source: Caselaw Access Project

author: WALKER, C. J.

license: Public Domain

text:
    THIBODEAUX et al. v. BOYT et al.
    No. 2292.
    Court of Civil Appeals of Texas. Beaumont.
    Dec. 12, 1932.
    Rehearing Denied Dec. 21, 1932.
    O. A. Lord, of Beaumont, for appellants.
    J. B. Morris, of Beaumont, and Llewellyn & Dougherty, of Liberty, for appellees.
   WALKER, C. J.

We take the following statement of the nature and result of this suit from appellants’ brief:

“Felix Thibodeaux and Constant Thibo-deaux, as plaintiffs, filed their suit in the District Court of Jefferson County, Texas, against Elmer Boyt and J.' M. Rich, as defendants, and alleged that o*n or about the 15th day of January, 1930, the defendants rented to the plaintiffs 320 acres of land.in Chambers County, to be cultivated by the plaintiffs in rice and for the purpose of growing a rice crop thereon during said year, and that the defendants agreed to furnish to the plaintiffs the land, the seed rice and the water ¡necessary to properly irrigate the said rice crop, and that the defendants also agreed to furnish one-half of the necessary fertilizer,. one-half of the sacks for sacking the rice that might be grown, and to pay one-half of the expense of threshing such crop of rice and hauling the same to market, and that the plaintiffs agreed to prepare the land and cultivate, water and harvest the rice; and they alleged that it was the agreement between the plaintiffs and defendants that the plaintiffs should have one-half of the crop of rice that should be grown by them on the land for said year and that the defendants should have the other half of the rice so grown.
“The plaintiffs further alleged that they timely and properly prepared the land for the rice crop, and in due season planted the crop with the seed furnished by the defendants for that purpose, and they alleged that they did and performed at the proper time and in the proper manner all of the things that they should have done to properly produce and save the rice crop on the rented premises; but that the defendants failed to furnish water according to their agreement so to do for the purpose of irrigating the said rice-crop and bringing up the rice, and that on account of the failure of the defendants to furnish and supply the water for irrigation as they had agreed and promised to do, although they furnished some water, the plaintiffs did not make a full crop of rice, and that on account of such failure to furnish the water they had sustained damages in the sum of $7,055.00, which would have been the value of their one-half interest in the rice crop which they would have grown had the water been furnished as it should have been by the defendants, less the cost and expense of harvesting, threshing, sacking and hauling to market the rice that would have been grown, which they alleged would not have been more than 45‡ per sack.
“The plaintiffs also alleged that the rice that was actually grown was taken possession of by the defendants and had been sold and the entire proceeds retained by the defendants, and that the defendants had never accounted to the plaintiffs for the sale of the rice and had wholly failed and refused to do so.
■ “Tlie case was tried to a jury and the plaintiffs introduced proof of the terms of the rental contract alleged by them, and that they had timely and properly prepared the land for the rice crop and that they had done the various things that they should have done in connection with the rice crop in a farmerlike manner, and they introduced proof of the amount of rice that was actually grown and that the land would have yielded if the rice had received sufficient water at the time the same was needed, and they introduced proof that the defendants had wholly failed to furnish the water at the time and in the amount that was necessary to irrigate and to produce a rice crop, and they showed the effect of the failure to furnish the water; and in support of all of the issues made by their pleadings the plaintiffs introduced proof upon the trial.
“The defendants pleaded the general denial and specially alleged that the plaintiffs did not prepare and cultivate the land in a farmerlike manner and that any failure in the rice crop was due to that, and they alleged that it was the plaintiffs’ agreement that they should build and maintain the proper laterals and levees for the irrigation of the rice and holding the water thereon, and that they should pump the water furnished by the defendants at the intake and turn on and off the water at proper times and distribute it over their crops so that they might be economically irrigated, but that they failed to do these things or to perform their contract in these respects, and that on account of these failures on the part of the plaintiffs in connection with their rice crop the same did not make a full crop of rice, and that by reason of these things the crop made 3600 sacks of rice less than it should have made, of the net value of $3.20 per sack, and that one-half of such crop that should have been grown by the plaintiffs would have belonged to the defendants and that therefore they had been damaged in the sum of $5,760.00.
“Defendants alleged also that they had made advancements for labor, supplies, etc., to the plaintiffs, and they attached to their answer what purported to be a verified account setting out the goods, wares, merchandise, labor, money, etc., that they had advanced to plaintiffs, and showing the amount of the credits which the plaintiffs were entitled to receive, and showing and alleging that after the plaintiffs had received credit for all of the rice that they had harvested and sold and for all other things for which they were entitled to credit, the plaintiffs still were indebted to the defendants in-the sum of $2,-577.02.
“Upon the trial, the verified account was introduced in evidence by the defendants over the objections of the plaintiffs, and the defendants introduced evidence tending to establish the issues made by their pleadings.”

The issues of fact raised by the pleadings and evidence were submitted to the jury as follows, answered as indicated:

“Special Issue No. 1. Did the defendants reasonably and substantially comply with the terms of the contract between them and plaintiffs to furnish at the intake and dam at proper times under said contract sufficient water to irrigate plaintiffs’ crop of rice? Answer ‘yes’ or ‘no,’ as you may find the facts tobe.”

The jury answered special issue No. 1, “No.”

“Special Issue No. 2. Did the defendants’ failure ,to furnish said water at the time and place inquired about in Special Issue No. 1 cause any loss in the amount of yield of said rice crop? Answer ‘yes’ or ‘no,’ as you may find the facts to be.”

The jury answered special issue No. 2, “Tes.”

“Special Issue No. 3. How much was the yield of said rice crop reduced, if any, by such failure, if there was such a failure?' Answer by giving the number of barrels, if any, said rice crop was so diminished.”

The jury answered special issue No. 3, “5,~ 100 barrels, entire yield.”

“Special Issue No. 4: What would have been the reasonable market value of said rice per barrel at the time and place that it could and would have been marketed? Answer by stating the amount in dollars and cents.”

The jury answered special issue No. 4, “$2.65 per barrel or total $13,515.00.”

“Special Issue No. 5: What would have been the reasonable cost per barrel for attending, harvesting, sacking, and marketing such, additional rice, if any? Answer by giving the cost per barrel in money, as you may find the facts to be.”

The jury answered special issue No. 5, “66(1 per barrel.”

“Special Issue No. 6: Did the plaintiffs fail to substantially and reasonably comply with, their contract with the defendants to pump, to their crop of rice the water furnished them at the intake and dam? Answer ‘yes’ or ‘no,’' as you may find the £aets to be.”

The jury answered special issue No. 6,. “No.”

“Special Issue No. 9: Did the plaintiffs fail to substantially and reasonably comply with the terms of the contract with defendants in. the preparation of the lands in question for the proper planting of rice? Answer ‘yes’ or-‘no- as you may find the facts to be.”

The jury answered special issue No. 9, “Yes.”

“Special Issue No. 10: Did such failure on the part of plaintiffs cause or contribute to the loss or damage, if any, suffered by the plaintiffs? Answer ‘yes’ or ‘no,’ as you may find the facts to be.”

The jury answered special issue No. 10, “Yes.”

“Special Issue No. 11: In what amount did such failure reduce the total number of barrels of rice which could and would have been grown, harvested, and saved by plaintiffs? Answer by stating the number of barrels.”

The jury answered special issue No. 11, “150 barrels.”

“Special Issue No. 12: Did the plaintiffs fail to substantially and reasonably comply with their contract with defendants to plant at a proper time and season the rice crop, or any part thereof, in question? Answer ‘yes’ or ‘no’ as you find the facts to be.”

The jury answered special issue No. 12, “No.”

“Special Issue No. 15: Did the plaintiffs fail to substantially and reasonably comply with their contract with defendants to timely harvest the rice crop in question, or any part thereof? Answer ‘yes’ or ‘no,’ as you may find the facts to be.”

The jury answered special issue No. 15, “No.”

The defendants made no objections or exceptions whatever to the court’s charge, nor to any of the special issues submitted.

Neither the plaintiffs nor the defendants made any complaint against the findings of th'e jury, and neither party filed a motion for a new trial.

By their motion for judgment, appellants, plaintiffs below, construed the verdict as finding in their favor for 5,100 barrels of rice, less the 150 barrels found in answer to special issue No. 11, and prayed for judgment against appellees, defendants below, for the value of one-half of 4,950 barrels of rice at $1.99 per barrel, less an admitted indebtedness of $2;-577.02 due by them to, appellees. Appellees filed motion for judgment in their belialf upon the verdict of the jury against appellants for $1,201.43. Appellants’ motion was refused, and appellees’ motion was granted, and judgment in their favor was entered, which contained the following recitation: “The court having considered said verdict, the pleadings, and the evidence on this 2nd day of March, 1932, finds that the same constitutes a verdict upon which the defendants, Elmer Boyt and J. M. Rich, are entitled to a judgment against the plaintiffs, Felix Thibodeaux and Constant Thibodeaux, in the sum of $1,-201.43.”

Opinion.

The correctness of the judgment appealed from must be determined by the proper construction of question No. 3, and the jury’s answer thereto. There is no ambiguity about this question. The jury was ashed a simple question as to how much the yield of appellants’ rice crop was reduced by the failure of appellees to furnish water, in accordance with their contract. The ambiguity lies in the answer, “5,100 barrels, entire yield.” . If the jury answered the question asked, and they had no authority to answer any other question, then appellants have correctly construed the verdict as finding in their favor for 5,100 barrels of rice, less the 150 barrels found by question 11. The trouble with this construction of the verdict is that it finds in favor of appellants for more than they sued for. The allegations of their .petition on their measure of damages were as follows: “Plaintiffs allege that if the defendants had furnished and supplied the plaintiffs with sufficient water to irrigate their rice crop as aforesaid, which it was their duty and undertaking to do, the plaintiffs cbuld and would have grown and produced as much as 6,400 sacks of rice. * * * Plaintiffs allege that on account of the failure of the defendants to furnish and supply water for irrigation as they undertook, promised, and agreed to do, the plaintiffs only produced, harvested, and threshed 2,200 sacks of rice, but the plaintiffs allege that they produced, harvested, and put in the shock additional rice amounting to approximately 800 sacks that was not threshed on account of the high water that came into the lower portion of the farm by the fault and negligence of parties other than the plaintiffe, and which occasioned the loss of that much rice in the shock which was lost to the plaintiffs ; but that on account of the failure of the defendants to furnish and apply the necessary water for the irrigation of their crop, the plaintiffs sustained a loss of 3,400 sacks of rice, and they allege that if the defendants had timely furnished and supplied the necessary water for the irrigation of their crop as they undertook and promised to do, the plaintiffs would have grown and produced 3,-400 sacks of rice more than they did produce.”

Appellants plead their case in terms of “sacks.” The issues were submitted in terms of “barrels.” Under the evidence, the 5,100 “barrels” found by the jury in answer to question No. 3 would amount to 4,080 “sacks.” The actual yield of the crop was 2,854 sacks which, added to the loss caused by the failure of appellees to furnish the water, if appellants correctly construed the verdict, would make a crop of 6,934 sacks, while appellants plead a crop of only 6,400 sacks. Again, they plead a loss of 3,400 sacks, and, as they construe the verdict, the jury found a loss of 080 sacks. For this reason the court did not err in overruling appellants’ motion for judgment in their favor on the basis of the jury’s finding of 5,100 barrels.

The judgment in favor of appellees is wholly without support in the verdict. If the jury meant to And, as appellees insist, that appellants would have made only 5,100 barrels of rice, had appellees not breached their contract, that issue was not submitte,d, and the finding cannot support the judgment.

We do not reform the judgment of the lower court to conform to appellants’ pleadings, because we doubt that such a judgment would have reasonable support in the evidence. While it is true that appellees did not ask for a new trial in the lower court and have not in this court attacked the verdict as being without reasonable support, their excuse is that both they and the court construed the verdict as being in their favor. However, appellees do insist, in their attack upon appellants’ construction of the verdict, that such a construction could not have been in the minds of the jury because it would have no reasonable support in the facts. Appellees cannot sustain their judgment under the verdict, and, as it would operate a manifest injustice upon them to reform the judgment to' correspond with appellants’ pleadings, we think the proper order to be made is to reverse the judgment of the lower court and remand the cause for a new trial, and it is accordingly so ordered.

Reversed and remanded.


author: BLAIR, J.

text:
    COMMERCIAL CASUALTY INS. CO. v. HILTON.
    No. 7792.
    Court of Civil Appeals of Texas. Austin.
    Nov. 10, 1932.
    Rehearing Denied Nov. 23, 1932.

      Harris, Harris & Sedberry, of San Angelo, and Collins & Houston, of Dallas, for appellant.
    Kerr & Gayer, of San Angelo, for appel-lee.
   BLAIR, J.

Appellee filed this suit as an appeal from the action of the Industrial Accident Board, refusing- to set aside a compromise settlement of his compensation claim, which the board had approved, but which was alleged to have been obtained by mistake or fraud as to the condition of appellee’s injuries when made; and refusing to award appellee such compensation as he might show himself entitled to receive. The trial resulted in setting aside the compromise agreement for fraud, and in a lump judgment for $2,545.57 as compensation, and $5,000 for medical and hospital services in favor of appellee.

The compromise settlement of the claim for compensation was executed and approved by the board in the manner provided by section 12 of article 8307. The order of the board refusing to set aside this agreement and the order approving it for fraud, and to reopen the case and award appellee the compensation to which he showed himself entitled to receive, omitting formal parts, reads as follows:

“The application of the claimant herein to reopen this case and set aside the order of the Board made and entered June 23, 1931, approving a compromise settlement agreement which motion was received and filed in this office July 29, 1931 (see page 74) has been duly considered by the Board.
“Under the decisions of the Supreme Gourt in the eases of Lumbermen’s Reciprocal Association v. Henderson [15 S.W.(2d) 565], and Lumbermen’s Reciprocal Association v. Day ! 3 7 S.W.(2d) 1043] we do not think we have jurisdiction to pass upon questions raised in said application, and for that reason we have today declined to set the application down for hearing.”

Appellee filed timely notice of intention not to abide by the order refusing to set aside the fraudulent compromise agreement, and refusing to reopen his case and award such compensation as he might show himself entitled to receive;' and timely filed this suit as an appeal from such action of the board, as provided in the Workmen’s Compensation Act, the petition alleging appellee’s injuries to be the same as stated in his application to the board for compensation; and alleging fully the facts showing mistake or fraud inducing the settlement agreement.

Appellant admits that the courts acquired jurisdiction to pass upon the question of whether the compromise settlement was induced by mistake or fraud; but contends that the courts acquired no jurisdiction to adjudicate appellee’s claim for compensation and for medical and hospital services, (a) because the Industrial Accident Board had no power or authority to pass upon the mistake or fraud issue, it being judicial; and that no award could be made by the hoard until the fraud issue had been determined by a court of competent jurisdiction in favor of appellee; and (b) because the board, as shown by its above-quoted order, had not exercised its jurisdiction to hear and determine such matters upon their merits; and had made no final appealable award thereon, citing the following cases as! supporting these contentions: Lumbermen’s Reciprocal Ass'n v. Wilmoth et al. (Tex. Com. App.) 12 S.W.(2d).972; Texas Employers’ Ins. Ass’n v. Hoelm (Tex. Civ. App.) 20 S.W.(2d) 263; Mingus v. Wadley, 115 Tex. 551, 285 S. W. 1084; Georgia Casualty Co. v. Campbell (Tex. Civ. App.) 266 S. W. 854; Lumberman’s Reciprocal Association v. Behnken, 112 Tex. 103, 246 S. W. 72, 28 A. L. R. 1402; Lumbermen’s Reciprocal Ass’n' v. Day (Tex. Com. App.) 17 S.W.(2d) 1043; Lumbermen’s Reciprocal Ass’n v. Henderson (Tex. Com. App.) 15 S.W.(2d) 565.

These contentions of appellant are not sustained. The last contention will be considered first. It is true that the jurisdiction .of courts under the Workmen’s Compensation Act attaches only by appeal from a final award or decision of the Industrial Accident Board, either awarding or refusing a claim for compensation or other relief authorized by the act. Lumberman’s Reciprocal’ Ass’n v. Behnken, supra; Mingus v. Wadley, supra; Jones v. Texas Indemnity Ins. Co. (Tex. Civ. App.) 15 S.W.(2d) 1077; Texas Indemnity Co. v. White (Tex. Civ. App.) 37 S.W.(2d) 277; section 12d of article 8306, as amended by Acts 1931, 42d Leg. c. 155, p. 260 (Vernon’s Ann. Civ. St. art. 8306, § 12d): and section 5 of article 8307, as amended by Acts 1931, 42d Leg. c. 224, p. 378 (Vernon’s Ann. Civ. St. art. 8307, § 5). The rule is also well settled that, where a claim for compensation is refused or denied for any reason by the board, and an appeal is taken, the courts acquire jurisdiction to determine all issues between the parties relating to the injury and compensation therefor, which includes all incidental claims resulting from the injury and allowed by the act, regardless of whether such had been asserted before the board. Lumberman’s Reciprocal Ass’n v. Behnken, supra; Ætna Life Ins. Co. v. Culvahouse (Tex. Civ. App.) 10 S.W.(2d) 803. And it has also been uniformly held that the Industrial Accident Board is an administrative body created for the purpose of administering the Workmen’s Compensation Laws in accordance with their provisions; that it has jurisdiction over the persons and subject-matter involved; and that in the performance of its duties it exercises administrative .and quasi judicial functions. Middleton v. Texas Power & Light Co., 108 Tex. 96, 185 S. W. 556; Vestal v. Texas Employers’ Ins. Ass’n (Tex. Com. App.) 285 S. W. 1011; Keller v. Texas Employers’ Ins. Ass’n (Tex. Civ. App.) 279 S. W. 1113; Southern Casualty Co. v. Todd (Tex. Com. App.) 29 S.W.(2d) 973; Texas Employers’ Ins. Ass’n v. Sewell (Tex. Civ. App.) 32 S.W.(2d) 262.

So in this case, if the board, in the exercise of its administrative and quasi judicial functions under the act, had the power or authority to review its previous order approving the compromise settlement agreement, ,and to set it aside or change or revoke it upon a showing that it had been procured by mistake or fraud, we think it manifest that the above-quoted order of the board, refusing to set aside the settlement agreement for .mistake or fraud, and refusing to consider ap-pellee’s claim for such compensation as he .might show himself entitled to receive, constituted a denial of the claim for compensation, giving the courts jurisdiction on this appeal. Southern Casualty Co. v. Todd (Tex. Com. App.) 29 S.W.(2d) 973; Texas Employers’ Ins. Ass’n v. Rodgers (Tex. Civ. App.) 281 S. W. 968 (writ of error dismissed). Nor ■can it be material whether the board refused to act because of the belief that it had no .authority to pass upon the question of mistake or fraud inducing the settlement agreement which it had theretofore approved. Whatever the reason for refusing appellee’s application for compensation, which the order recites the board had duly considered, the refusal to act effectively closed the door of relief to him; and was a denial of his pending claim for compensation. We therefore pass to a consideration of the question of whether the board, in the performance of its administrative and quasi judicial functions, had thq power or authority to review its previous order approving the settlement agreement in connection with the application of ap-pellee to set it aside for mistake or fraud; and to award appellee the compensation to which he might show himself entitled to receive.

In the recent ease of Estes v. Hartford Accident & Indemnity Co. (Tex. Civ. App.) 46 S.W.(2d) 413 (writ of error refused), it was held (a) that, since section 12 of article 8307 provided for the approval by the Accident Board of the compromise settlement of the claim for compensation, an order or award •of the board approving same had the force and effect of a judgment or an award of compensation; and (b) that, upon the issue being submitted within the compensation period, the settlement agreement approved by the board had been procured by mistake or fraud, the board had the authority to revoke or change its previous order of compensation based upon the settlement agreement, and to award such compensation as the injured employee showed himself entitled to receive, by virtue of the provisions of section 12d of article 8306, as amended by Acts 1931, 42d Leg. c. 155, p. 260 (Vernon’s Ann. Civ. St. art. 8306, § 12d), authorizing the board “upon its own motion or upon the application of any person interested showing * ⅜ * mistake or fraud, the Board at any time within the compensation period, may review any award or order, ending, diminishing or increasing compensation previously awarded * * * or change or revoke its previous order.” We have examined the application forwrit of error in this case, and it, as well as all the courts passing upon the case, either assumed or specifically held that, the board, under authority of the above statutes, could set aside its previous order approving a compromise agreement induced by fraud. A similar holding was made in the case of Employers’ Ins. Ass’n v. Rodgers, supra. In the cases of United States Fidelity & Guaranty Co. v. Cooper (Tex. Civ. App.) 14 S.W.(2d) 342, 343; Id. (Com. App.) 29 S.W.(2d) 971; Id. (Com. App.) 33 S.W.(2d) 189; Maryland Casualty Co. v. Meyer (Tex. Civ. App.) 41 S.W.(2d) 291; Commercial Standard Ins. Co. v. Lowrie (Tex. Civ. App.) 49 S.W.(2d) 933, 937, and cases there cited, it was held in substance that, unless a claim for compensation is presented and acted upon by the board in connection with an application to set aside a compromise settlement for fraud, the courts have no jurisdiction to award compensation, but may only set aside the agreement. To the same effect is Lumbermen’s Reciprocal Ass’n v. Henderson (Tex. Com. App.) 15 S.W. (2d) 565. But these cases are not directly in point here, where the claim for compensation was filed and presented and considered by the board in connection with appellee’s application to set aside the order approving the compromise agreement; and the board’s order recites that, although it had considered the claim for compensation, it refused to pass upon same, because the Henderson Case, supra, and the case of Lumbermen’s Reciprocal Ass’n v. Day, supra, prohibited it from doing so. This last case has no application to the question, except to the extent that it holds a compromise agreement approved by the bo.ard may only be set aside for mistake or fraud inducing it. It is true that the court held in the I-Ienderson Case that the board had no authority or jurisdiction to pass upon the question of fraud, because such was a judicial question. This case, however, makes no reference to the aforementioned statutes authorizing the board, in its administration of the Compensation Act, to review its previous order or award and to set it aside upon a showing that it had been induced by mistake or fraud. Neither does this case, nor the cited case of Middleton y. Texas Power & Light Co., supra, attempt to pass upon the constitutionality of these statutes which clearly and explicitly confer this power upon the board. And since the board’s decision on such questions is only administrative, or at least merely quasi judicial, and not final, and the trial on appeal is de novo, we see no good reason why these statutes should be declared unconstitutional as being an attempt by the Legislature to confer judicial powers upon the Accident Board. We are not unmindful in this connection that the court in refusing the writ of error in the Estes Case, supra, could have done so upon the finding that the evidence did not establish the fraud as a matter of law, and that the court had jurisdiction of the fraud issue without regard to any action of the Accident Board thereon. But, in view of the fact that writs of error have been recently refused and dismissed in cases which refer to and predicate their decisions upon the authority of the statutes in question and the practice of the board in considering the case upon its merits at the time and in connection with an application to set aside a previous order approving a compromise agreement because induced by fraud, and to award or deny compensation as it determines the fraud issuQ, we have reached the conclusion that such practice is not prohibited, even if it has not modified to that extent the holding in the Henderson Case.

It may further be observed in this connection that the courts have also uniformly held that the board had the authority, and that it was its duty, to determine in the first instance before the jurisdiction of the courts would attach, such legal or judicial questions as to whether the employee was covered by the contract of insurance; or whether the employee had received ⅜ compensable injury in the course of his employment; or whether the employee was an independent contractor; or whether he was in law employed by an independent contractor rather than by the assured. These and many other judicial questions as far reaching as the question of mistake or fraud have been uniformly held to be proper questions for the board to determine as an initial step in the administration of the Workmen’s Compensation Laws. The piecemeal practice suggested by appellant of having a court of competent jurisdiction first pass upon the mistake or fraud issue, and if the employee be successful on the issue, then require him to again apply to the board for compensation, is not practicable. Such procedure can only lead to confusion and complications in the administration of the act. We therefore conclude in this ease that the board, in the performance of its initial duties and in the performance of its administrative and quasi judicial functions as required by the statutes, had not only the authority to set aside the compromise settlement for fraud, but to adjudicate at that time and in connection with appellee’s application or claim for such compensation ¿nd medical and hospital services as he might show himself entitled to receive; and that its refusal to act in that regard constituted a denial of appel-lee’s claim, and from which action he has correctly prosecuted this appeal.

By its second proposition appellant contends that, as á matter of law, the evidence showed no mistake or fraud imputable to it which might have induced appellee to execute the compromise agreement approved by the board. We do not sustain the contention.

Appellee alleged that both the settlement agreement and the order approving it were induced by mistake; or, if not by mistake, by the fraud of appellant, it being alleged that for a long period of time subsequent to his injury appellee was repeatedly examined by, and was continuously under the observation of, physicians employed by appellant, by reason of which fact the nature, extent, seriousness, and permanency of his injury and any disease resulting therefrom were peculiarly well known to appellant; that, shortly prior to.the settlement agreement and the approval thereof by the board, Dr. T. Y. Jennings was appointed by the board to examine appellee and to report his findings to the board; that Dr. Jennings reported that he was unable to find any complications that might be the result of appellee’s injuries, and that there was no evidence then existing that he had ever suffered any injuries; that said report was made recklessly and without knowing whether or not it was correct; and that appellant, its agents and employees, well knew that said report was incorrect, but knowingly and willfully concealed from appellee the inaccuracies and errors therein; that ap-pellee relied particularly upon the representations of Dr. Jennings, and that his report was true; and would not have made the agreement but for such report .to the effect that he had entirely recovered of his injuries; when in fact he was at the time and is now suffering from pulmonary abscesses,- hernia, shock, and jar to all parts of his body as the result of his injuries, which totally and permanently disabled him.

The. record shows that appellee was injured on January 29,1931, while in the course of his employment, by being struck with the “Johnson bar” of a wheeled scraper, which he was operating, and by the scraper passing over his body, resulting in cuts and bruises on his ear, head, shoulder, and chest; and, according to the first attending doctor, in a “fractured clavicle, fractured ribs and sternum.” A claim for compensation was duly filed with the Accident Board. Appellee was treated by appellant’s doctor, T. K. Turney, on January 29 and 30, and February 2, 5, and 15. Dr. Turney reported to appellant March 14 that “patient discharged as cured February 15, 1931, * * * patient able to resume work February 20, 1931.” Shortly before this last date, appellee moved from Robert Lee to Winters, and appellant’s doctor, N. J. Smith, treated him there on March 5, 11, 14, and 21; and on March 28 Dr. Smith reported to appellant that “patient pronounced able to resume work as of March 21, 1931. Patient discharged as cured on 3/21/31.” And further reported, as follows: “I removed old dressing and redressed patient. I consider patient has recovered from injury, but am of the opinion he is likely to be a Tubercular, though he can do some work. I think it best for you to dismiss his case, as I am doing.”

In March prior'to these reports, appellant had paid appellee two weekly payments of $7.7S each; but, after receiving these reports from its doctors, appellant made no further payments. Appellee’s condition gradually grew worse, and on April 21, 1931, his wife took him to the State Tuberculosis Sanitori-um for examination. Dr. Anderson examined him on that date, and found a pulmonary abscess on his left lung in an incipient state; and he told Mrs. Hilton to have the family doctor make necessary papers for his admission to the sanitoriuin. It is not shown from the record whether any <jloctor made this examination for appellee.,- With the exception of a few days, appellee has been confined to his bed continuously since his injury. The evidence shows that from the date of his injury he coughed intermittently and spit up blood. In the latter, part of April appellee’s wife employed a lawyer to take up with the board why compensation had been stopped. On May 9,1931, the board appointed Dr. Thos. V. Jennings to make an examination of appel-lee for the purpose- of giving “the Board the very best and most disinterested information obtainable respecting (his) actual condition.” Dr. Jennings made his report on May 15, 1931, which was received by the board May 18, 1931, that appellee “complains of injury to left side of chest on January 29, 1931. He suspects abscess of lung or Tuberculosis as a direct result of said injury. ⅜ * ⅝ Expansion good breath sounds rather exaggerated on both sides, few moist rales over entire chest but that may happen in any smoker’s chest, and he smokes. XRay picture ^howed nothing abnormal.” Other findings not material here were made, and the report concluded as follows: “I am unable to find any complications that might be direct result of above injury, nor any positive evidence that he had ever had an injury, since it has all entirely cleared up.”

Thereafter, on May 21, 1931, appellant’s agent called upon appellee’s attorney and proposed the compromise settlement, and told him of the previous reports of appellant’s two doctors to the effect that appellee had entirely recovered of his injuries, and had been by them discharged as cured; and, after examining and knowing of Dr. Jennings’ report, and after consulting with and being told by appellant’s two doctors that appellee had entirely recovered of his injury, and that they had discharged him as cured, the attorney told appellee and his wife that he saw no relief for them, and left it to them if they would make the compromise agreement; and that at their suggestion he drew the compromise agreement and had it executed, the agent being present and signing for appellant. The compromise settlement agreement was executed in accordance with the provisions of section 12 of article 8307, reciting a consideration of $50, and that his injury was uncertain and indefinite, or incapable of being satisfactorily established. The agreement was filed with the Accident Board and approved by it June .23, 1931; the order further reciting that a “compromise settlement receipt,” showing that appellee had received $75 in full accord and satisfaction of his claim, had been filed with the board. Just why the extra $25 was so paid is not shown from the board’s record. On July 28, 1931, appellee filed his application to set aside the compromise agreement for fraud, and to reopen the case, and award him compensation. ’ The attorney further testified that he would not have made or suggested the agreement but for the statements of appellant’s doctors, and particularly the statement of Dr. Jennings, to the effect that appellee had entirely recovered of his injuries ; and that these representations alone induced him to recommend or suggest the settlement. A few days after the settlement agreement was executed, appellee had a severe hemorrhage, spitting up blood and pus. Appellee’s family physician for several years preceding his injury testified that he had treated him for pneumonia and chiekenpox; and that he had no symptoms of tuberculosis before the injury; and that he was a tenant farmer until shortly before he was employed in the employment in question, in which he was doing manual labor of handling a scraper. Another doctor of many years’ experience in the treatment of tuberculosis examined ap-pellee on November 20, 1931, and found him to be suffering from pulmonary abscess of the left lung in advanced stages, and also to a lesser degree in the right lung, and from which he was of the opinion appellee would never recover. It was the opinion of this expert, based upon the facts as detailed in the evidence, that “in all probability a tuberculosis inflammatory process developed under that combination of circumstances, due to the occurrence of the trauma”; that is, from having received the fracture of his ribs, chest bone, and collar bone when struck by the Johnson bar of the scraper. He also stated from his examination of appellee he could tell that tubercular abscesses had existed for some months previous to the time of the examination.

Appellant insists that this evidence is insufficient to establish fraud for three reasons, as follows:

(1) That the report of Hr. Jennings was made in good faith; (2) that his report was not relied upon by appellee; (3) that he was not the agent of appellant in making the report.

The evidence would undoubtedly support the conclusion of the jury that Dr. Jennings made a very perfunctory examination of appellee and did not know whether he was suffering of tuberculosis at the time of the examination; or, if he did know it, made a false representation in that connection; and, if he did not know it, he positively represented that he was not suffering from tuberculosis at the time. The rule is that fraud exists where one makes a false representation of a material fact knowing it to be false, or of his own knowledge, when he does not know whether it is true or false, thereby inducing the person to whom it is made, or who is relying upon it, to do or to refrain from doing something to his pecuniary hurt, when such person, acting with reasonable prudence, is thereby deceived and induced to do or refrain from doing the thing to his damage. Wortman v. Young (Tex. Civ. App.) 221 S. W. 660; Schallert v. Boggs (Tex. Civ. App.) 204 S. W. 1061; Cohen v. Lewis (Tex. Civ. App.) 44 S.W.(2d) 468; Ford v. Sims (Tex. Civ. App.) 190 S. W. 1165; Morrison v. Adoue, 76 Tex. 255,13 S. W. 166; 2 Bouvier’s Law Dictionary (Rawle’s Third Revision), 1304; White v. Peters (Tex. Civ. App.) 185 S. W. 659 ; 26 C. J. 1109.

The evidence of the lawyer who represented appellee in the compromise settlement is uncontroverted that he did rely upon the representations of Dr. Jennings in recommending the compromise settlement, and would not have done so but for the representations.

Nor do we sustain appellant’s third contention that the alleged mistaken or fraudulent report of Dr. Jennings was not attributable to it, because he was not the agent of appellant in making the report, but of the board. The settlement agreement under its own terms and the statutes relating thereto had no legal or binding effect until approved by the board. Texas Employers’ Ins. Ass’n v. Knouff (Tex. Civ. App.) 271 S. W. 633 (writ of error refused). The evidence is undisputed that the attorney for appellee relied particularly upon this report of Dr. Jennings in making or in recommending the making of the settlement agreement. He had also been theretofore informed by appellant’s doctors who had attended appellee that he had been discharged by them as being entirely recovered of his injury. The report of Dr. Jennings also induced the board to approve the compromise settlement agreement. It was filed with the board May 18, 1931. On May 28, 1931, appellant filed the compromise agreement together with the previous reports to it of its two doctors, to the effect that ap-pellee had entirely recovered of his injury on the respective dates mentioned. On May 29, 1931, the board began its hearing of the settlement agreement, and, after the filing in June of the “compromise settlement receipt” by appellant, approved the agreement June 23, 1931.

The evidence is also undisputed that appellant had in its possession the report of its Dr. Smith, that he was “of the opinion he (ap-pellee) is likely to be a tubercular,” which particular information was not shown to have been made known to appellee’s attorney before he made the recommendation of settlement. The evidence is also undisputed that appellant as well as appellee relied upon all of the doctors’ statements, including that of Dr. Jennings, to the effect that appellee had entirely recovered of his injury, in inducing the board to approve the settlement agreement, which approval was necessary to its validity. And the only fraud issue submitted, with the jury’s answer thereto, reads as follows:

“Do you find from a preponderance of the evidence that Dr. T. O. Jennings’ report of plaintiff’s purported recovery dated May 15, 1931, to the Industrial Accident Board was a report not known to be true? Answer ‘he did’ or ‘he did not’ know it to be true. Answer: He did not know it to be true.”

We therefore conclude that, since all parties relied upon this report, which induced the agreement and its approval by the board, and since the approval by the board was necessary to the validity of the agreement, the order so induced by fraud should be set aside. Nor can this rule be affected because appellant’s particular agent who signed the contract may not have known that the report was false, because all parties relied upon it as being true in obtaining the approval of the board of the settlement agreement; and manifestly appellant cannot take advantage of such fraud.

With respect to the charge that the report of Dr. Jennings was due to mistake, we have concluded that the question was properly considered, not as a separate independent ground for review of the award, but in connection with and as an element of fact on the fraud issue of whether the report was made not knowing it to be correct. Estes v. Hartford A. & I. Co., supra.

Nor do we sustain appellant’s proposition in this connection, that, if the evidence was sufficient to sustain the issue of fraud, the court erred in refusing to give in that connection the following requested issue: “Was the compromise agreement introduced in evidence herein procured by fraud of the defendant or any agent of the defendant? Answer yes or no.”

The requested issue was not pertinent to the fraud issue submitted and above quoted. The .only other pertinent element of fraud material to the theory of fraud submitted was whether the board was induced by the report of Dr. Jennings to approve the settlement agreement. This issue was not requested, an<[ it will be presumed that the trial court found this issue in support of the judgment rendered under the rule announced in the case of Ormsby v. Ratcliffe, 117 Tex. 242, 1 S.W.(2d) 1084.

By its third proposition appellant contends that there was not sufficient competent evidence upon which to base the award and the judgment to the plaintiff of $5,000 for medical bills and hospital expenses.

Special Issues 8 and 9, with the jury’s answers thereto, read as follows:

“Do you find from preponderance of the evidence that proper care of plaintiff would require confinement, medical and hospital services ordinarily furnished in hospitals? Answer ‘yes’ or ‘no.’ Answer: Yes.”
“What amount, if any, and not exceeding $12,300 do you find from preponderance of the evidence would furnish reasonable compensation for the services mentioned in the next preceding interrogatory? Answer by' stating the amount. Answer: $5,000.00.”

In substance the charge and the issue submitted bath follow the language of the statutes authorizing the recovery of medical and hospital services. Sections 7, 7a, and 7b of article 8306. The evidence supports the verdict of $5,000, as “reasonable compensation” for medical and hospital services ordi¡narily furnished in, hospitals. The care, meals, medical attention, etc., furnished to a disabled employee commensurate with his reasonable needs are included in hospital services, and need not be furnished in a hospital, but may be furnished in a private residence. Southern Surety Co. v. Beaird (Tex. Civ. App.) 235 S. W. 240.

Nor is there any merit to the contention that the statutes referred to only authorize compensation for medical and hospital services for four weeks, to be allowed on proper application to the board one week in advance. .The statutes authorize such services “during the fourth or any subsequent week of continuous total incapacity, requiring confinement to a hospital.” It is true in this connection that the board, so long as it has jurisdiction of the claim for compensation, may only allow such expenses weekly, but, when its jurisdiction has been ousted by an appeal to the courts, these limitations of the statutes are no longer applicable. And it was held in the case of Federal Surety Co. v. Cook, 119 Tex. 89, 24 S.W.(2d) 394, that, absent statutory authority to that effect, the district court has no authority to revise its judgment awarding weekly compensation after the term expires, on proper showing regarding change of conditions, mistake, or fraud at any time in the compensation period. By analogy the same is true with respect to the continuing authority to allow weekly compensation for future medical and hospital services. Consequently, the judgment on appeal may cover all future medical and hospital services which the employee might be entitled to receive during the compensation ’ period. The amount reasonably necessary for these future expenses is therefore for the jury to determine from the facts and circumstances of the case and the issues submitted. These future expenses are necessarily “impossible of very exact computation or assessment, and hence the determination of the amount is deemed to be peculiarly within the discretion of the triers of facts.’' 13 Tex. Jur. p. 183, § 89, and p. 189, § 94, and cases there cited.

By its fourth proposition appellant contends that the lump sum judgment for $2,545.57 is erroneous because there was no evidence from which the proper rate of discount could be determined, and cites the case of Holloway v. Texas Indemnity Ins. Co. (Tex. Com. App.) 40 S.W.(2d) 75, which announces the rule contended for by appellant. But that rule has been suspended by the later statutory rule of discount provided by article 8306a, Acts 42d Legislature, chapter 248, section 1 (Vernon’s Ann. Civ. St. art. 8308a), which provides that, where the insurance company redeems its liability for payment of “weekly compensation,” the “discount shall be allowed for pz-esent payment at 6% per cent compounded annually.” The decisions construe this present law as authorizing the discounting of a lump sum award 6 per cent., regardless of pleadings or proof, and a finding as to proper discount rate. Traders’ & General Ins. Co. v. Powell (Tex. Civ. App.) 44 S.W.(2d) 764; Indemnity Ins. Co. v. Bailey (Tex. Civ. App.) 50 S.W.(2d) 484.

By its fifth proposition, appellant makes this same contention with reference to the allowance of $5,000 in lump sum for future medical and hospital services. Appellant asserts in its brief that, with respect to the “question as to awarding $5,000.00 as a lump sum for hospital services, it seems to be in the same category with weekly compensation.” If so, then the last above quoted statute, authorizing the 6 per cent, discount, is applicable, and no necessity existed for proving the proper discount rates, as above held.

Appellant did not request any jury issue as to the amount of weekly compensation for medical and hospital services, and as furnishing a basis for discounting same 6 per cent, for present payment; nor did it object upon that ground to the issue submitted, and in answer to which the jury found that $5,000, if paid now, would be reasonable for such expenses. Appellant- will therefore be held to have waived the question of proper discount for present payment.

Tlie remaining proposition is not sustained that Dr. Cornick should not have been permitted to give his expert testimony that appellee was in a tubercular condition when he examined him in November, 1931, as the result of trauma, because he based his opinion on the history of the case, but without giving the history of'the case. The history of the case was in evidence, and the hypothetical question propounded was predicated upon this evidence.

The judgment of the trial court will be affirmed.

Affirmed.


author: JACKSON, J.

text:
    SECURITY STATE BANK et al. v. SPINNLER.
    No. 3905.
    Court of Civil Appeals of Texas. Amarillo.
    Nov. 16, 1932.
    Rehearing Denied Dec. 14, 1932.
    Lockhart & Brown, of Lubbock, for appellants.
    Alfred M. Scott, of Lubbock, for appelle.e.
   JACKSON, J.

The plaintiff, G. E. Spinnler, instituted this suit in the district court of Lynn county, Tex., against the Security State Bank of Tahoka, W. O. Henderson, A. J. Edwards, W. C. Wells, and G. E. Lockhart, together with several other defendants.

Plaintiff alleges that in January, 1932, the bank, acting through its authorized agents, converted and applied to its own use and benefit twenty-four bales of cotton of the value of $619.47 owned by the plaintiff, or in any event on which he had a valid and subsisting landlord’s lien to secure the payment of rents and advances due him by his tenants who had cultivated his farms in Lynn county, Tex., for the year 1931, and that W. O. Henderson aided and abetted the bank in the conversion of said cotton.

He also pleaded that G. E. Lockhart and A. J. Edwards as individuals unlawfully converted said cotton to their use and benefit.

In addition to the actual damages for the value of the cotton, he also sought to recover $1,000 as exemplary damages against the bank in its corporate capacity and against G. B. Lockhart and W. C. Wells in their individual capacities, and alleged that the conversion of the cotton was willful and malicious, and for the purpose of harassing and injuring him.

He pleads that, in determining the punitive damages, the court and jury are entitled to consider the probable advance in the market price of the cotton converted, the expenses and attorneys’ fees incurred by him in prosecuting the suit, that it was made difficult by defendants’ conduct for him to pay his taxes, and that his tenants, who were very desirabie as such, were caused by the depression and the malicious action of the defendants to abandon his farms, and he would in all probability lose the amount due him by his tenants for advances made to them to enable them to cultivate their crops in 1930.

The Security State Bank, W. O. Henderson, W. C. Wells, A. J. Edwards, and G. E. Lockhart answered by general demurrer, numerous special exceptions, general denial, and pleaded that said tenants were indebted to the bank and that the plaintiff waived his rights and landlord’s liens to the crops for 1931 in consideration of the bank making certain additional advances to said tenants; that the bank thereupon accepted from each of said tenants a valid chattel mortgage on the crops grown by each of .them on their respective premises rented from plaintiff for the year 1931 and advanced to each of them money; that said tenants defaulted and the defendants in good faith acquired the cotton by virtue of the mortgages.

On the answer of the jury to special issues submitted by the court, judgment was rendered against the bank, G. E. Lockhart, W. O. Wells, W. O. Henderson, and A. J. Edwards, jointly and severally, for the sum of $183.95, with interest as actual damages, and against the bank for the sum of $250, with interest as exemplary damages, from which judgment this appeal is prosecuted.

The appellants assign as error the action of the trial court in overruling their exceptions to the allegations in plaintiff’s petition asserting that the court and jury should take into consideration, in determining, his punitive damages, the probable advance in the price of the cotton, his probable loss by his tenants abandoning his farms, and the effect on his ability to pay his taxes, and his attorneys’ fees and expenses.

They also challenge as error the action of the court in admitting the testimony tending to establish such allegations.

If the cotton advanced in price, this would be an item of actual damages, but the expenses incurred in the lawsuit, including attorneys’ fees, are not actual damages. Neither can the amount of the expenses incurred or the attorneys’ fees paid be recovered as exemplary damages, but the law appears to be that, if properly alleged and proved, they may be considered by the jury in determining the amount of punitive damages to be awarded.

“When a party is entitled to vindictive damages, the jury in making up their verdict, may, no doubt, if they are so disposed, consider the plaintiff’s expenses in prosecuting the suit.” Landa v. Obert, 45 Tex. 539.

In Wheat v. Ball et al. (Tex. Civ. App.) 68 S. W. 181, 182, speaking of- the pleadings of plaintiff, the court says: “He alleged a long list of consequences to himself as the result of the sequestration, such as that he had been injured thereby in his good name; that one of the animals was his only cow, and, not having means of purchasing another, his family was obliged to do without milk and butter; that he was a farmer, and the seizure of his mare and mules (the only work animals he had) injured his means of making a living, and he has since been dependent on his friends and neighbors for a horse to ride, or a team to work; that he had been compelled to pay attorney’s fees in the original suit, etc. 'Such matters would not be elements to be considered of actual damages (Kaufman v. Armstrong, 74 Tex. 65, 11 S. W. 1048; Mayer v. Duke, 72 Tex. 445, 10 S. W. 565; Neese v. Radford, 83 Tex. 585, 19 S. W. 141; Lackey v. Campbell [Tex. Civ. App.] 54 S. W. 46), and they are evidently not alleged here as such, but as matters concerning the claim for exemplary damages; and in that connection the jury could properly consider them.”

To the same effect are the holdings in Fred Mercer Dry Goods Co. et al. v. Fikes (Tex. Civ. App.) 211 S. W. 830; Daughtry v. Blanket State Bank (Tex. Civ. App.) 41 S.W.(2d) 627.

For the jury to consider the expenses and attorneys’ fees in determining.the amount of exemplary damages, it is necessary to show that such items were necessary and reasonable. This appellee failed to do. The ex- * ceptions relative to the conduct of appellants rendering it difficult for appellee to pay his taxes and-the abandonment of his farms'by his tenants should’ have been sustained, and no evidence pertaining thereto should have •been admitted.

The appellants present as error the action of the trial court in rendering judgment against them because not sustained by the findings of the jury, which are, in effect, that the plaintiff in the fall of 1930 promised the" bank, acting through W. O. Wells, that, if it would carry the indebtedness of the tenants until the fall of 1931 and make additional loans to them, he would waive his landlord’s lien on 'the crops to be raised during that year by the tenants in favor of the bank, and that mortgages taken by it would constitute a first lien against the crops; that such waiver or agreement affected only the undivided three-fourths interest of the tenants in the crop; that the state bank acted willfully and maliciously and without probable cause in taking possession of the cotton in controversy, but that W. 0. Wells and G. E. Lockart did not act willfully and maliciously and without probable cause; that plaintiff was entitled to recover $250 exemplary damages.

Whether the pleadings were sufficient to authorize the court to submit that the waiver of plaintiff released only the three-fourths of the tenants’ interest in the cotton involved, it is unnecessary to determine, as this can, if error, be remedied by an amendment at another trial.

Appellants’ contention that the findings of the jury are, in effect, that G. E. Lockhart and W. C. Wells did not act willfully and maliciously and without probable cause, must be sustained. The record discloses that Mr. Lockhart is president and Mr. Wells is vice president of the bank and took possession of the cotton involved in this controversy for the bank as such officials, under the authority, given in the mortgages.

“The entity of a corporation is a mere concept resting solely in legal fiction. A corporation is an artificial being, without mind, soul, heart, or life; it may not conceive a purpose, form, or execute a plan, or do an act except through the agency of men or women. Whatever those men and women, acting singly or in confederation, may do in its name or behalf, at least within the general scope of employment, represents it in action in the achievement of the charter purpose.” Chronister Lumber Co. v. Williams (Tex. Com. App.) 288 S. W. 402, 403.

The corporation, independent of its officers, the president and vice president in this case, could entertain no malice or perform any willful act, -and, as the jury found that such officers did not act willfully, maliciously, and without probable cause, this assignment is sustained.,

The appellants present as error the action of the court in refusing to submit, at their request, whether or >not the officers of the bank, G. E. Lockhart and W. C. Wells, in taking possession of and disposing of the cotton, acted in good faith and with the honest belief that such acts were lawful and proper.

The court evidently considered the charge submitted 'sufficient to cover the issues requested,- but the submission of these issues would have eliminated all controversy as to the scope of the findings on the issue of malice, probable cause, and good faith, and under this record should have been submitted. 13 Tex. Jur. 243, § 134.

Appellants’ contention that they were entitled to a peremptory instruction is not tenable.

The appellee presents numerous counter propositions presenting as error the action, of the trial court in sustaining certain special exceptions urged by appellants to his petition.

The record -discloses that appellee pleaded the insolvency of the bank; that it had closed its doors and was liquidating its assets; that he would not be able to secure a trial on the merits of the case before the fall of the year 1932; that the assets of the bank would probably be. dissipated, and he would be unable to collect any judgment obtained by him against the bank, sought a writ enjoining further distribution of the assets of the bank and the appointment of a receiver to take charge of its properties and assets for the protection of himself and other creditors.

The appellants filed exceptions to the sufficiency of the allegations to warrant the issuance of a writ of injunction or the appointment of a receiver, which the court sustained, holding that at the time the court had no jurisdiction to grant such relief upon the conditions alleged to exist. The appellee excepted to this action, but dismissed as to all the defendants except those mentioned above, and voluntarily proceeded to trial on the remaining allegations against appellants.

He did not allege the insolvency of the individual defendants retained in the proceeding, and any judgment against such individual' defendants for actual or punitive damages, so far as this record revealed, could be enforced. The other defendants were dismissed without prejudice to appellee’s rights, and the action of the court in so doing does not, as presented, disclose error.

The judgment is reversed, and the cause remanded.


text:
    DAVIS et al. v. CICERO-SMITH LUMBER CO. et al.
    No. 3892.
    Court of Civil Appeals of Texas. Amarillo.
    Nov. 2, 1932.
    Rehearing Denied Dec. 14, 1932.

      Vickers & Campbell, of Lubbock, for appellants.
    Rob’t A. Sowder and Bean & Klett, all of Lubbock, for appellees.
   JACKSON, J.

The Cicero-Smith Lumber Company, a corporation, instituted this suit against Effie L. Davis and her husband, T. D. Davis, their single daughters, Pearle and t Blanche, and C. E. Maedgen, and the Lubbock National Bank, a banking corporation, to recover $8,-000, consisting of a balance of the principal, with interest and attorney’s fees, evidenced by a note, and to foreclose its lien securing the payment thereof on lots 13 to 24, inclusive, in block 2 of the McCrummen Second addition to the town of Lubbock.

The Davises answered by numerous exceptions, general denial, alleged that Effie L. Davis and T. D. Davis were husband and wife on all the dates involved in this litigation ; that the lots on which a lien was asserted were the community property of Effie L. and T. D. Davis, and constituted their homestead and was occupied as such, although the legal title had been placed in trust in the name of Pearle Davis; that the Cicero-Smith Lumber Company was advised and had full knowledge of all the facts and circumstances, by reason of which the lien alleged by said lumber company was null and void.

Pearle Davis answered that she executed the note and lien as an accommodation to the lumber company at the direction of her mother, Effie L. Davis, who conducted all the negotiations pertaining to the building and the lien asserted by said company; that she (Pearle) was not the owner of the property, had no interest therein, and received no consideration for the debt, although the legal title had been placed in her.

In answer to the contention of the Davises, the lumber company pleaded certain facts which it alleged constituted an estoppel.

C. E. Maedgen and the Lubbock National Bank answered by plea of intervention, alleged that the bank acquired and was .the owner in due course of certain notes executed by Pearle, Effie L., and T. D. Davis, as part of the purchase price of the lots in controversy and that said notes were secured by a .vendor’s lien retained in the deed from the owner, Eva Knight, conveying the lots to Pearle Davis; that, partial payments having been made, certain of the lots were released, but the balance due the bank on the notes was the sum of $1,202, with interest and attorney’s fees; and that its lien against lots 13 to 17, inclusive, securing .the payment thereof, was valid and subsisting, and prayed for a foreclosure thereof against the lumber company and all of the defendants.

In reply to the intervention of the bank, ■the Davises set up certain facts upon which they based a plea of usury and claimed that they were entitled to a reduction on the amount claimed by the bank because of such alleged usury.

The pleadings consist of some forty-eight pages of the transcript, but we deem the above statement sufficient for the purpose of reviewing the questions presented.

The ease was-tried to a jury, but the judge directed a verdict for the lumber company and also for the bank, and entered judgment for each of said corporations granting the relief substantially as prayed for, and the Davises have appealed.

The appellants assail as error the action of the trial court in directing a verdict in favor of the Cicero-Smith Lumber Company, because they contend if the testimony does not conclusively show that the property in controversy was "the homestead of Effie L. and T. D. Davis, husband and wife, it does present an issue of fact relative thereto, and, as no instrument was executed by the husband and wife as provided by law for fixing a lien against the homestead, the lien asserted by the lumber company was void and unenforceable.

The record indicates that Effie L. and T. D. Davis purchased the lots, 13 to 24, inclusive, involved in this controversy, from Eva Knight on December 31, 1923, for a consideration' of $1,920 paid and á balance of $-1,080, evidenced by four notes of $1,020 eacli; that the lots were conveyed to Pearle Davis and the notes for the deferred payments were executed by Pearle and her mother, Mrs. Effie L. Davis; that at the time of the purchase there was located on lots 13 and 14. an eight-room house, together with some other improvements, into which Effie L. and T. D. Davis moved with their family; that the payments made on the four vendor’s lien notes given to Mrs. Knight were made by Effie L. and T. D. Davis; that, in consideration of these payments all the lots had been released, except lots 13 to 17, inclusive; that the Lubbock National Bank had acquired the purchase-money notes in due course of trade upon which the balance sued for was still due and secured by the lien on said last-named lots. There is some testimony that all the lots, 13 to 24, inclusive, were claimed, used, and occupied in connection with the residence on lots 13 and 14, as the homestead of the Davises since their purchase in 1923 ; that in March, 1927, Mrs. Effie L. Davis contracted with A. M. Hensley to furnish the labor and material and erect a one-story briclc and tile six-room house on lot 22 for a consideration of $6,500, and that Pearle Davis, at the request of her mother, executed a note and mechanic’s lien on March 16, 1927, to secure the payment of said sum; that on the completion of said building the Davises occupied it as a home; that on March 21st thereafter Pearle Davis sold and conveyed to Effie L. Davis, for a recited consideration of $2,000 paid out of her separate funds “and the assumption by said Effie L. Davis of all debts, liens and claims of every character against” all of lots 13 to 24, inclusive; that the Cieero-Smith Lumber Company furnished the material for the erection of the brick and tile house on lot 22 and acquired the-» note and mechanic’s lien from A. M. Plensley.

There is testimony to the effect that A. M. Hensley and the agents of the Cieero-Smith Dumber Company were advised of and had knowledge of the fact that the lots were the community property of Effie L. and T. D. Davis, who had the equitable title thereto, and ■ that Pearle Davis, in whom the legal title was vested, held in trust for her father and mother.

Without rehearsing the testimony in detail, the.above, we think, is sufficient to disclose that the testimony presented issues of fact pertaining to the equitable title of Effie L. and T. D. Davis, their homestead claim, and the knowledge of the lumber company relative thereto.

The testimony, in our opinion, was not sufficient to authorize the court in saying as a matter of law that Effie L. and T. D. Davis were estopped from urging the defenses presented, and the court committed reversible error in peremptorily instructing a verdict in behalf of the lumber company.

The appellants contend that, inasmuch as Effie L. Davis was a married woman and could not be held liable personally, her assumption “of all debts, liens and claims of every character” as a part of the consideration for the lots conveyed 'to her by her daughter Pearle Davis, did not create a valid lien against said lots and especially the lots other than lot 22.

“There can be no doubt that the face of this deed was properly construed by the court below to show a vendor’s lien on all the land conveyed by it, and not merely on the tracts covered by the original mortgage. The vendor’s lien springs up from the contract of purchase, unless waived by the parties themselves. In this case the deed upon its face shows an agreement as a part of the consideration for the purchase of the 60,000 acres; that the grantee would pay to the J. B. Watkins Company the debt which they held against the Ganos. The grantee took the whole tract, subject to this vendor’s lien. Joiner v. Perkins, 59 Tex. 300, and authorities there cited; Slaughter v. Owens, 60 Tex. 668; Meyer v. Smith, 3 Tex. Civ. App. 37, 21 S. W. 995.” Texas Land & Loan Co. v. Watkins, 12 Tex. Civ. App. 603, 34 S. W. 996, 998. To the same effect is the holding in Lanham et al. v. West et al. (Tex. Civ. App.) 209 S. W. 258. See, also, Parten v. Martin (Tex. Civ. App.) 240 S. W. 1037; Mitchell v. National Railway Building & Loan Association (Tex. Civ. App.) 49 S. W. 624.

In stating the liability of a married woman for the unpaid purchase money for land which she has acquired, Judge Speer says: “While under our peculiar system of land laws the superior title to land sold is said to remain with the vendor until the payment of the purchase money, lands purchased by her on credit remain liable at all times to be subjected to the payment of this purchase money ; she is not personally liable. The land only can be recovered and nothing further.” Speer’s Law of Marital Rights, p. 224, § 172.

Where the notes of a married woman and her husband are given for the purchase price of land purchased in her name, “there was no error in decreeing the sale of the land for the satisfaction of the vendor’s lien.” Lynch et al. v. Elkes, 21 Tex. 229. Substantially the same holding is made in Noel v. Clark et al., 25 Tex. Civ. App. 136, 60 S. W. 356, and Girardeau v. Perkins et al., 59 Tex. Civ. App. 552, 126 S. W. 633, writ denied. These authorities dispose of appellants’ contentions adversely to them.

The appellants present as error the action of the trial court in directing a verdict in behalf of the Lubbock National Bank because the pleadings and testimony show that the bank had charged usurious interest on its notes.

The record discloses that the testimony by which the appellants undertook to show that they had heon charged usurious interest on the notes by the bank was excluded, and appellants do not present in their brief any assignment challenging as error the action of the court in excluding this testimony. Hence this assignment is overruled. If we should consider this excluded testimony, we seriously doubt the sufficiency thereof, under the entire record, to show a usurious charge of interest. However, inasmuch as no complaint is made of the exclusion of the testimony, it is unnecessary to pass on that question.

The judgment in favor of the bank is affirmed, but the judgment in favor of the lumber company is reversed, and the case as between it and appellants is remanded.