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    Susie Ashcraft PITTS, Independent Executrix of the Estate of James Buford Ashcraft, III, Deceased, and Kreidler-Ashcraft Funeral Directors, Inc., Appellants, v. Dorothy K. ASHCRAFT, Appellee.
    No. 1444.
    Court of Civil Appeals of Texas, Corpus Christi.
    Aug. 30, 1979.
    Rehearing Denied Sept. 21, 1979.

      James H. Denison, Jr., Denison & Mann, Harlingen, for appellants.
    Wm. L. Hubbard, Bonner & Bonner, Har-lingen, for appellee.
   OPINION

NYE, Chief Justice.

This suit for damages and other relief is predicated upon the terms of a property settlement agreement executed by Dorothy K. Ashcraft, Appellee, and her late, former husband James Buford Ashcraft, III, which was incorporated into their divorce decree. Mrs. Ashcraft filed suit, alleging that the executrix of her former husband’s estate had refused to accept and pay to her claims against his estate which were authorized by the terms of the agreement. The executrix, Susie Ashcraft Pitts, Appellant, answered on behalf of the Estate, and filed a cross-action seeking to recover certain insurance proceeds previously paid to Mrs. Ashcraft by an insurer, allegedly in contravention of the agreement. Kreidler-Ash-craft Funeral Directors, Inc. (Kreidler-Ash-craft), also an appellant, intervened alleging that it was the third-party beneficiary to a non-competition covenant contained in the property settlement agreement, which Mrs. Ashcraft had breached. After a non-jury trial, the trial judge entered judgment in favor of Mrs. Ashcraft, denying all affirmative relief sought by the Executrix and Kreidler-Ashcraft. The court filed findings of fact and conclusions of law in support of his judgment. The executrix, on behalf of the Estate, and Kreidler-Ashcraft appealed.

Mrs. Ashcraft and James Buford Ash-craft, III (J. B.) were married in 1935. Three children were born of their marriage, Susie Ashcraft Pitts, (Executrix and Appellant herein), Mary Louise Ashcraft and James Buford Ashcraft, IV (Buck). In 1943, Mr. and Mrs. Ashcraft moved to Har-lingen, Texas, and started a funeral home business (Kreidler-Ashcraft), in which they were the shareholders. On July 18, 1975, Mrs. Ashcraft and J. B. Ashcraft executed a “Separation and Property Settlement Agreement in Contemplation of Divorce” which was approved and incorporated into their divorce decree. The agreement, in substance, provided for the specific division of the community estate of Mrs. Ashcraft and J. B. Mrs. Ashcraft received, among other property, title to the community residence and certain periodic payments, while J. B. received title to all of the shares of Kreidler-Ashcraft, in addition to other specified property. The present dispute between the parties before this Court concerns the following three paragraphs of the agreement:

“VII PERIODIC PAYMENTS
(b) . . . Husband hereby agrees to pay all premiums which may become due following the entry of any Decree of Divorce herein on a certain insurance policy on his life, the same being Policy No. CA2997 of the Lincoln Liberty Life Insurance Company which provides for Fifty Thousand Dollars ($50,000.00) in life insurance benefits to be paid to Wife as the beneficiary in the event of the death of Husband. On the execution of this Agreement and a Final Decree of Divorce herein approving the same, Husband agrees to take all action necessary to name Wife as irrevocable beneficiary of the aforesaid policy and transfer the ownership and control of the policy to Wife.
If as a result of the Husband’s failure to comply with the terms of this article, and the Husband dies prior to the Wife, and if the Wife does not receive the full amount of the policy, she shall have a claim against the estate of the Husband for such amount or for the difference between said amount and the proceeds she does not receive.”
“XIV
NON-COMPETITION AGREEMENT
For and in consideration of this Agreement and the agreement of J. B. Ash-craft, III to pay to Dorothy K. Ashcraft the periodic payments described in Paragraph VIII above, Dorothy K. Ashcraft agrees that for a period of ten (10) years from the date of the divorce between the parties she will not engage in the funeral home or mortuary business anywhere in Cameron County, Texas. She will not become employed by any funeral home or funeral director, she will not invest any money or thing of value in any such enterprise, she will not allow her name to be used in connection with any such business, and she will not encourage or advise anyone else in connection with the operation of a funeral home or mortuary in this county.”
“XVI
AGREEMENT TO DEVISE OR BEQUEATH PROPERTY
As further consideration Husband hereby agrees to provide at his death for the Wife, if she is surviving, by devising or bequeathing a legal life estate only in favor of Wife in all shares of stock of Kreidler-Ashcraft Funeral Directors, Inc. owned by Husband at the time of his death. In the event Husband dies owning stock in Kreidler-Ashcraft Funeral Directors, Inc., with the Wife surviving, and Husband by his will does not create the aforementioned life estate . Wife shall have a claim against Husband’s estate in an amount equal to One Hundred Thousand Dollars ($100,-000.00).”

Approximately nine months after the agreement was executed and the divorce was granted, J. B. died from injuries he sustained in an accident. Thereafter, J. B.’s will was duly admitted into probate and Susie Ashcraft Pitts (daughter) was duly appointed Independent Executrix of the estate by the probate court. Under the provisions of the will, J. B.’s entire estate, including all real and personal property, was devised and bequeathed, in equal shares, to his daughters, Susie Ashcraft Pitts and Mary Louise Ashcraft. The will did not mention J. B.’s former wife, Mrs. Ashcraft, or his son, Buck. On June 23,1976, Mrs. Ashcraft filed a claim for $200,000.00 in the Probate Court against J. B.’s estate based upon paragraphs VII(b) and XVI of the agreement above quoted. The claim was refused by the Executrix and thereafter, Mrs. Ash-craft filed this suit.

Mrs. Ashcraft plead that J. B. failed to bequeath to her a legal life estate in the shares of stock of Kreidler-Ashcraft he owned (pursuant to the provisions of paragraph XVI of the agreement), and the Executrix wrongfully denied her claim against the estate for $100,000.00, less $45,000.00, an amount Mrs. Ashcraft acknowledged having received from Kreidler-Ashcraft. Mrs. Ashcraft further alleged that J. B. had failed to name her as irrevocable beneficiary on one certain life insurance policy mentioned in paragraph VII(b) of the agreement, and accordingly, she had a valid claim against the Estate in the amount of $100,000.00 (a sum equal to the double indemnity proceeds payable for accidental death), which was wrongfully refused by the Executrix. Mrs. Ashcraft prayed for the recovery of these sums, less the amount she had already been paid by Kreidler-Ash-craft, plus prejudgment interest and attorney’s fees. Mrs. Ashcraft also sought a declaratory judgment that the non-competition clause contained in paragraph XIV of the agreement be declared void and unenforceable.

Susie Ashcraft Pitts, Independent Executrix, answered on behalf of the “Estate” and filed a cross-action seeking the recovery of $108,000.00, an amount previously paid by Mutual of Omaha Insurance Company to Mrs. Ashcraft, the named beneficiary on six insurance policies that were in force on the date of J. B.’s death. These policies were a part of the benefits set aside to J. B. under the agreement. Kreidler-Ashcraft intervened and, along with the Executrix, sought damages and injunctive relief, alleging that Mrs. Ashcraft had breached the non-competition clause contained in paragraph XIV of the agreement.

Prior to trial, the parties entered into lengthy stipulations as to certain facts and as to the admissibility of certain documents which were entered into evidence at trial. The substance of the stipulations relevant to this appeal were: 1) regarding Mrs. Ash-craft’s allegations concerning her claims pursuant to paragraph VII(b) of the agreement, that, prior to his death, J. B. did not take action to name Mrs. Ashcraft as irrevocable beneficiary of that one certain policy named therein; that Kreidler-Ashcraft, the named beneficiary therein, had paid all of the premiums from the time of divorce to the time of J. B.’s death and had received insurance proceeds under the terms of the double indemnity provisions of the policy in a net amount of $82,993.99, after the insurance company had deducted the sum of $17,006.01, which represented an outstanding loan against the policy in the name of Kreidler-Ashcraft; 2) concerning Mrs. Ash-craft’s claim pursuant to paragraph VIII(b) of the agreement, that J. B.’s will did not leave a life estate in favor of Mrs. Ashcraft in the shares of Kreidler-Ashcraft stock owned by J. B. at the time of his death; and 3) concerning the claims of the Executrix to previously described insurance policies, there remained six additional specified Mutual of Omaha Insurance Company policies carrying total insurance proceeds in the amount of $108,000.00 each of which, at the time of J. B.’s death, still named Mrs. Ashcraft as beneficiary and that Mrs. Ashcraft received such proceeds from the insurance company.

In addition to the other stipulations not mentioned herein, the parties presented extensive testimony and other documentary evidence in support of their respective claims, some of which will be discussed in more detail under the specific points of error below.

After hearing all of the evidence, the trial judge entered a judgment which awarded Mrs. Ashcraft the sum of $191,-612.33. This included her claims totaling $165,000.00, pursuant to the terms of the agreement, prejudgment interest and the sum $15,000.00, as reasonable attorney’s fees for the prosecution of her claims pursuant to the agreement. The trial court denied her request for a declaration that the non-competition clause was void and unenforceable and denied all affirmative relief sought by the Executrix and the Interve-nor, Kreidler-Ashcraft.

The joint appellant’s brief filed on behalf of the executrix and Kreidler-Ashcraft presents twenty-three points of error. Most of these points of error variously attack the trial court’s failure to hold that Mrs. Ashcraft breached the non-competition covenant contained in the agreement. The remaining points of error complain of the trial court’s failure to grant any of their requested affirmative relief.

The dispute concerning the alleged breach of the non-competition covenant centers around the establishment of a funeral home in the city of Harlingen by “Buck” Ashcraft, the only son of Mrs. Ash-craft and her late husband. Buck’s competing funeral home (incorporated under the name of Ashcraft Funeral Home, Inc.), opened for business on March 19, 1978. Buck testified that he had been engaged in various phases of the funeral home business, commencing at the age of ten, when he worked for his father at Kreidler-Ash-craft. Buck was employed by Kreidler-Ashcraft until sometime in February of 1975, when the relationship between Buck and his father deteriorated to the extent that Buck left the business. Thereafter, for the next year and one-half to two year period, Buck worked in various phases of the funeral home business in other locations. Buck testified that although he had previously considered the possibility of building a funeral home somewhere in Cameron County for some years, his decision to go ahead with such plans occurred sometime in March of 1976, the same month his father died. The record is replete with evidence concerning the details concerning the stages of Buck’s progress in planning and completing his funeral home. The evidence showed that after J. B.’s death and prior to and during the construction of this new funeral home, Mrs. Ashcraft made a number of monetary gifts to Buck. It was not contested at trial that some of her gifts were subsequently used by Buck to establish his new funeral home. Included in such gifts were two promissory notes in which Mrs. Ashcraft was the named payee. She assigned the notes to Buck. He subsequently used the notes as collateral to obtain interim financing for the construction loans. Buck also used a cash gift he received from his mother to be applied to the purchase price for land necessary for the construction site.

The trial court’s findings of fact concerning the non-competition clause were contained in one paragraph of the judgment, which we have grouped by sentence as follows:

1.“During the planning and construction phase of the funeral business operated by her son, and on other occasions, Plaintiff (Mrs. Ashcraft) made gifts to him (Buck) in the form of cash.”
2. “Some, but not all, of these cash gifts were subsequently used by plaintiff’s son (Buck) to purchase land and other supplies and materials for the construction and operation of Buck Ashcraft Funeral Directors, Inc.” (sic)
3. “At the time that such gifts were made, Plaintiff knew or should have known that some of the cash gifts would be used by her son as set out herein, but such gifts were not made with the motive to violate the non-competition ageement in question.”
4. “Plaintiff did not invest any money or thing of value in such enterprise, has not allowed her name to be used in any way in connection with such business, nor has she encouraged or advised her son (Buck) or anyone else in connection with the operation of a funeral home or mortuary in Cameron County, Texas.”

In point of error number one, Appellants complain that, as a matter of law, Mrs. Ashcraft breached the non-competition covenant by giving her son cash and notes with the knowledge that they would be used to establish a competing funeral home. Appellants are arguing, in effect, that the trial court’s finding that Mrs. Ashcraft gave cash gifts to her son with the knowledge that he would use them to engage in a competing funeral home business violates that portion of the non-competition clause which states that Mrs. Ashcraft “will not encourage or advise anyone else in connection with the operations of a funeral home or mortuary.” The negative findings contained in finding 4 quoted above, however, substantially track the language of this portion of the non-competition clause in question, and in effect, absolve Mrs. Ashcraft of the charge that she engaged in such competitive activity. Although not directly raised, implicit in Appellants’ contentions is the argument that findings of fact 1, 2, and 3 above conflict with finding of fact 4 above.

In support of this point of error, Appellants first contend that the non-competition clause in question is sufficiently broad to prevent, not only direct competition by Mrs. Ashcraft herself, but also broad enough to prohibit acts on her part which would have the effect of encouraging or aiding other persons, including her son Buck, who might wish to engage in such competition. Although Appellants make some general arguments to the effect that Mrs. Ashcraft breached all of the prohibitions contained in the non-competition clause by her monetary gifts to Buck, the crux of the dispute between the parties is the issue of whether or not, under the circumstances, such gifts violated that portion of the non-competition clause in which Mrs. Ashcraft agreed not to encourage or advise anyone else in connection with the operation of a funeral home business.

In Texas, and in the majority of the other jurisdictions, mere loans or gifts of money to a person engaged in a similar business, without more, are not a breach of a non-competition covenant in which the covenantor agrees not to engage, either directly or indirectly, in such competing business. Cf. Owen v. Willis, 20 S.W.2d 338, 340 (Tex.Civ.App.—Amarillo 1929, writ dism’d). See: e. g., Buckingham Tool Corp. v. Evans, 35 Mich.App. 74, 192 N.W.2d 362 (1971); Thomas v. Thomas Truck & Caster Co., 228 N.W.2d 52 (Iowa 1975); Slate Co. v. Bikash, 343 Mass. 172, 177 N.E.2d 780 (1961); Adams v. Adams, 156 Neb. 778, 58 N.W.2d 172 (1953); Annot., Rendering Financial or Other Assistance to Another as Breach of Covenant not to Compete, 1 A.L. R.3d 778, § 3(a), pp. 783-785 (1965). The rationale underlying this result is generally that the covenantor does not engage in or become interested in the competing business, nor does he adversely affect the sale of good will, by merely rendering financial assistance to the competitor. Generally, therefore, in order for the breach of such a covenant to occur, the covenantor must also undertake a more active participation in the competing enterprise, such as giving the competitor the benefit of his experience, knowledge, and/or influence to assist the competitor in the conduct of his competing business, in addition to rendering financial assistance. See Annot., Rendering Financial or Other Assistance to Another as Breach of Covenant not to Compete, 1 A.L. R.3d 778, § 3(b), pp. 785-86 (1965), and authorities cited therein.

None of the parties has cited a single Texas case or a case from any other jurisdiction which even considers the question of whether or not gratuitous financial assistance alone violates a non-competition clause wherein the covenantor has agreed not to “encourage” another to engage in a competing business. Although our research also has not revealed a case exactly on point, a similar non-competition covenant (wherein the covenantor who sold his business agreed not to “aid and advise ... or influence any person . . . to so compete”) was considered in Barrett v. Curtis, 407 S.W.2d 359 (Tex.Civ.App.—Dallas 1966, no writ). In that case, the Court found that there was ample evidence to support the jury’s finding to the effect that such covenant had been breached, including evidence: 1) that after the sale, covenantor’s brother established the only other competing business in town in a place of business owned by the covenantor; 2) that the cove-nantor leased additional space to his brother and received rental income therefrom; 3) that various people employed by the cove-nantor also participated in the conduct of his brother’s competing business; 4) that the covenantor personally signed his brother’s note at the bank for the purchase of additional equipment; 5) that the covenantor’s name was used in conjunction with the competing business; and 6) that the purchaser subsequently went out of business. See Barrett v. Curtis, 407 S.W.2d at 362-63. Certainly, the covenantor in Barrett rendered much more than mere financial assistance to his competing brother.

As a general rule, negative covenants, such as the one before us, are to be closely scrutinized. A restrictive covenant not to compete must be reasonably neces8 sary, must not be oppressive, and must not be broader than the business sold. The covenant, to be enforceable, must not impose a greater restraint than is reasonably necessary to protect the business conveyed. The reasonableness of a restrictive covenant is generally a question of law. Weatherford Oil Tool Co. v. Campbell, 161 Tex. 310, 340 S.W.2d 950 (1960). See also Justin Belt Co., Inc. v. Yost, 502 S.W.2d 681 (Tex.Sup.1973).

Where, as here, neither party has alleged that the contract is vague or ambiguous, the construction of the contract is a question of law for the court. City of Pinehurst v. Spooner Addition Water Co., 432 S.W.2d 515, 518 (Tex.Sup.1968). In such a situation, the courts will give effect to the intention of the parties as expressed or as it is apparent in the writing. In the usual case, the instrument alone will be deemed to express the intention of the parties for it is the objective, not subjective intent that controls. City of Pinehurst v. Spooner Addition Water Co., 432 S.W.2d 515, 518 (Tex.Sup.1968).

Buck was not a party to the non-competition clause, nor was he ever required to sign a non-competition clause as a condition of his prior employment with Kreidler-Ashcraft. The language of the non-competition covenant, “not to encourage or advise anyone else,” lends no direct support to the theory that Mrs. Ashcraft contracted away her right to make gifts to her son, assuming such a provision would be valid as protecting a legitimate interest of the Kreidler-Ashcraft Funeral Directors, Inc. If financial gifts to the son loomed as a substantial factor, we infer that an attempt would have been made to directly treat that subject in the non-competition clause. Covenants in restraint of trade do not rest upon inference. The agreement will not be extended by implication, and it will be construed in favor of rather than against the interests of the covenantor. Houston Transfer & Carriage Co. v. Williams, 221 S.W. 1081 (Tex.Com.App.1920, holdings app.); Seline v. Baker, 536 S.W.2d 631, 634 (Tex.Civ.App.—Houston (1st Dist.) 1976, no cwrit); Texas Shop Towel Inc. v. Haire, 246 S.W.2d 482 (Tex.Civ.App.—San Antonio 1952, no writ). Appellants’ point of error one is overruled.

Appellants’ points of error, two and three are, in effect, legal and factual sufficiency points which contend that 1) the undisputed evidence established as a matter of law that Mrs. Ashcraft encouraged her son in connection with the operation of his funeral home business, and that she had invested things of value in such enterprise, and 2) that the trial court’s findings to the contrary are against the great weight and preponderance of the evidence. These points of error direct our attention to other evidence, including the cash gifts which, the appellants contend, show that Mrs. Ashcraft did encourage her son in contravention to the non-competition clause in question.

In considering Appellants’ legal sufficiency points, we, of course, must review the evidence in its most favorable light, considering only the evidence and reasonable inferences drawn therefrom in support of the judgment and disregarding all evidence and inferences to the contrary. Garza v. Alviar, 395, S.W.2d 821 (Tex.Sup.1965). In deciding Appellants’ insufficient evidence points, this Court is required to consider all of the evidence. In Re King’s Estate, 150 Tex. 662, 244 S.W.2d 660 (1951).

The substance of the relevant testimony is to the effect that Mrs. Ashcraft’s monetary gifts to Buck were not given to him for any particular purpose, and that such gifts were given to him without restrictions. There is evidence that Mrs. Ashcraft also gave substantial gifts to her daughters, including tuition and living expenses for Mary Louise during the time she attended school at Southern Methodist University, and a trip to Europe for Susie Ashcraft Pitts and her husband.

Mrs. Ashcraft stated that Buck had mentioned the possibility that he might use her gifts to establish a funeral home business, and that she had told him “If you do, it’s on your own.” She further told him that she would not participate in his business venture. Mrs. Ashcraft testified that she had not participated in his business venture, nor given Buck advice on how to run his business. She further stated that she did not work for her son; she did not own any shares of stock in her son’s corporation; she had never personally guaranteed any of her son’s debts; she had not underwritten his business venture, and that she did not know that her son would borrow money on the notes that she had given to him. Buck testified, in substance, that his mother was not involved in his business venture in any manner, was not an employee, a creditor, a shareholder, or an advisor.

Susie Ashcraft Pitts, Mrs. Ashcraft’s daughter and appellant herein, admitted that she had no personal knowledge: 1) that her mother had ever been employed by Buck’s funeral home; 2) that her mother had ever invested money or anything of value in Buck’s funeral home; or 3) that her mother had ever given Buck any encouragement or advice in connection with the operation of his business. She further stated that no one had ever told her that Mrs. Ashcraft had done any of these things in furtherance of Buck’s funeral home business.

The record as a whole in this case demonstrates to us that Mrs. Ashcraft did virtually everything within her power to comply with the non-competition covenant in question. Although there is some evidence that Mrs. Ashcraft knew or had reason to know that her son intended to open a competing funeral home business, and the trial court so found, there is no evidence in the record that she did anything to further her son’s objectives, other than to give him cash gifts. Neither is there evidence that these gifts received any publicity connecting Mrs. Ashcraft to her son’s new business venture in any manner. Thus, those activities which impair the value of goodwill, e. g., the use of the covenantor’s name or expertise, or covenantor’s efforts to draw old customers, are no present in this case. We pause to note that Mrs. Ashcraft’s late husband and the father of Buck disinherited his only son and gave everything he had to his two other children (one of which was the appellant, the executrix of his estate). It would follow that the mother could give gifts to her son out of her portion of her estate as a natural act and not as one in contravention of the covenant not to compete or encourage competition. Compare Slate Co. v. Bikash, 343 Mass. 172, 177 N.E.2d 780 (1961).

We conclude that there is ample evidence in the record to support the trial court’s findings that Mrs. Ashcraft had not encouraged her son in connection with the operation of his funeral home business, and had not invested any money or thing of value in such enterprise, and such findings are not against the great weight and preponderance of the evidence. Appellants’ points of error two and three are hereby overruled.

In points of error eight and nine, the Appellants attempt to attack the trial court’s alleged “implied findings” that the non-competition covenant is unreasonable and unenforceable on legal and factual sufficiency points of error. These contentions find no support in the record. Although Mrs. Ashcraft’s trial pleadings alleged that the non-competition covenant was supported by no consideration and also that it was unenforceable as against public policy, the trial court made no findings in this regard, and the trial court’s judgment denied all further relief not expressly granted therein. Mrs. Ashcraft abandoned her initial appeal, which was predicated upon the proposition that the non-competition clause was void and unenforceable. Appellants sought an injunction in the trial court to enforce the non-competition agreement, which was also denied by the trial court in its final judgment. The issue of whether or not the non-competition covenant is enforceable or unenforceable per se is not before us at this time. Appellants’ points of error eight and nine are accordingly overruled.

We fail to see the materiality of the findings which Appellants attack on legal and factual sufficiency grounds in points of error four through seven. Appellants’ arguments and authorities applicable to these points of error fail to bring forward any theory upon which this particular finding would be material to the controlling issues of this case or to the trial court’s judgment. Accordingly, Appellants’ points of error four through seven are hereby overruled.

Points of error ten through seventeen are predicated upon the proposition that Mrs. Ashcraft breached the non-competition covenant in question. Our disposition of the prior points of error renders these points of error immaterial, and they are also overruled.

The Executrix’s cross-action sought, in part, a declaration that the estate, and not Mrs. Ashcraft, was entitled to receive the proceeds of the Mutual of Omaha Life Insurance policies. The trial court found: 1) that the Mutual of Omaha Life Insurance policies in question were part of the benefits set aside to Mrs. Ashcraft’s deceased husband in the agreement; 2) that at the time of J. B.’s death, Mrs. Ashcraft was the named beneficiary on each policy; and 3) that J. B. had not taken any action to change the beneficiary, although he had a right to do so. Based on these findings, the trial court concluded that Mrs. Ashcraft was entitled to keep the proceeds of the Mutual of Omaha Life Insurance policies. We agree.

The Executrix contends, in point of error number eighteen, that the trial court erred as a matter of law by failing to render judgment in favor of the Executrix in the amount of the policy proceeds as an offset against any liability of the Estate to Mrs. Ashcraft. In the alternative, the Executrix contends in point of error nineteen, that the trial court erred by failing to award the Estate one-half of the proceeds paid to Mrs. Ashcraft on such policies. The executrix argues that Mrs. Ashcraft relinquished her “right,” as beneficiary, to receive the proceeds of such insurance policies by the express terms of the agreement. The executrix relies upon the terms of the preamble to the agreement which provides, in relevant part, as follows:

“The following Agreement is entered into . in contemplation of divorce for the purpose of finally determining all property rights, tangible or intangible, vested or future, and for the purpose of finally determining all rights, duties, and obligations, including inchoate marital rights, which may have arisen because of the marital or family relationship (or which are attributable to property transfer, directly or indirectly, pursuant to this Agreement) . . . ”

Appellant contends that the trial court’s finding that such insurance policies were part of the benefits set aside to Mrs. Ash-craft’s deceased husband, when considered in conjunction with the above preamble is sufficient to constitute a relinquishment of Mrs. Ashcraft’s contingent interest as a named beneficiary under the insurance policies. We disagree.

As a general rule where, as here, the insured reserves the right to change the beneficiary in an insurance policy, the beneficiary therein obtains no vested interest in the proceeds of the policy prior to the death of the insured. The insured may change the beneficiary at will, and thereby divest a prior beneficiary of all interest in the proceeds of the policy. Volunteer State Life Ins. Co. v. Hardin, 145 Tex. 245, 197 S.W.2d 105 (1946); Box v. Southern Farm Bureau Life Ins. Co., 526 S.W.2d 787 (Tex.Civ.App.—Corpus Christi 1975, writ ref’d, n.r.e.). In Texas, former spouses retain an insurable interest in each other’s lives even though their marriage has been dissolved. McCain v. Yost, 155 Tex. 174, 284 S.W.2d 898 (1955); Scherer v. Wahlstrom, 318 S.W.2d 456 (Tex.Civ.App.—Fort Worth 1958, writ ref’d). Tex.Ins.Code Ann. Art. 3.49-1 (1963).

A contention similar to the one before us was rejected in Partin v. deCordova, 464 S.W.2d 956 (Tex.Civ.App.—Eastland 1971, writ ref’d). In that case, the former wife and widow of the deceased insured both claimed the right to receive the proceeds of certain insurance policies insuring the life of the decedent. The widow’s claim was based upon a property settlement agreement between the decedent and the former wife, which had been incorporated into the divorce decree. The former wife, however, claimed the proceeds in question on the basis that she was the named beneficiary in the policies. The appellate court rejected the widow’s contention that all interest in the insurance policies, including their prospective proceeds, constituted community property which was relinquished by the former wife and vested in the husband as his separate property by the terms of the settlement agreement without the need of any technical change of beneficiary in the policies. In support of its holding that the former wife was entitled to receive the proceeds of the insurance policies, the court stated as follows:

“We cannot agree with [widow’s] contention, in effect, that [former wife] by the settlement agreement not only surrendered her community property rights in the policies in question, but that such settlement also had the effect of destroying her rights as to the designated beneficiary under such policies. While it is true that [former wife] surrendered her community interests in the policies, the deceased . . ., as the owner of such policies had the right to change or retain the beneficiaries named therein. He did not exercise his right to change the beneficiary. Since [former wife] had an insurable interest and continued to be the named beneficiary under the policies, she was entitled to the proceeds thereof at deCordova’s death.” (citations omitted). Partin v. deCordova, 464 S.W.2d 956 (Tex.Civ.App.—Eastland 1971, writ ref’d).

Courts in other jurisdictions have reached varying results when considering the issue of whether the designated beneficiary of an insurance policy, in spite of such designation, has relinquished the right to receive the policy proceeds upon the insured’s death, pursuant to the terms of such property settlement agreement, depending relevant statutes and the specificity of the agreement in question. Appellant concedes that there is no Texas authority concerning the precise issues before us, and we have found no controlling Texas authority. Appellant relies primarily upon the cases of Hollaway v. Selvidge, 219 Kan. 345, 548 P.2d 835 (1978); O’Brien v. Elder, 250 F.2d 275 (5th Cir. 1959); and Spalding v. Williams, 275 Wis. 394, 82 N.W.2d 187 (1957). We have examined each of these authorities and find they are distinguishable or are not controlling. In each instance either 1) the cited case is directly contrary to the writ refused case (Partin v. deCordova, supra); or 2) the property settlement agreements in question contained provisions in which the parties specifically relinquished their rights to the property awarded to the other spouse or their right to set up any claim to any of the property awarded to the other spouse. The general rules which Texas seems to follow have been stated as follows:

“The wife may, upon divorce, contract away any rights in insurance on her husband’s life in which she is named as the beneficiary. General expressions or clauses in a property settlement agreement between a husband and wife, however, are not to be construed as including an assignment or renunciation of expectancies, and a beneficiary therefore retains his status under an insurance policy if it does not clearly appear from the agreement that in addition to the segregation of the property of the spouses, it was intended to deprive either spouse of the right to take under an insurance contract of the other, and while the failure of the husband to exercise his power to change the beneficiary ordinarily indicates that he does not wish to effect such a change, each case must be decided upon its own facts.” (Emphasis added). 4 Couch on Insurance § 27:114, p. 655 (1960).

We are of the opinion that the terms of the agreement before us fail to show that the parties intended to renounce Mrs. Ash-craft’s contingent rights, as the named beneficiary, to receive the insurance proceeds in question. Appellant’s points of error eighteen and nineteen are hereby overruled.

In point of error number twenty, Appellant contends that the trial court erred in awarding Mrs. Ashcraft $100,000.00 pursuant to paragraph VHI(b), less the sum of $45,000.00 she had previously received, because her claim under this paragraph was limited to $50,000.00, the face amount of the Lincoln Liberty Life Insurance policy in question. Appellant contends that the phrase, “for such amount,” refers to the face amount of the policy, and does not include the double indemnity benefits. We do not agree.

It is quite apparent to us from the express provisions of this paragraph that the parties intended for J. B. to name Mrs. Ashcraft as the irrevocable beneficiary on this particular policy. In such event, she would receive the proceeds as paid by the insurance company, whether such amount equalled $50,000.00 the face amount of the policy or $100,000.00, the double indemnity amount payable in the event of accidental death. If, at the time of death, Kreidler-Ashcraft had an outstanding loan against the insurance policy, and the insurance company paid the beneficiary less than the full amount, the parties to the agreement intended for Mrs. Ashcraft not to be prejudiced thereby, but rather, to receive the full amount of the policy she otherwise would have received. Appellant’s construction of the paragraph is a strained one which focuses on one phrase without reference to all of the provisions of the policy as a whole. Appellant’s point of error twenty is overruled.

The trial court’s judgment also awarded Mrs. Ashcraft $15,000.00 as reasonable attorney’s fees. In support of this award, the trial court found, in substance, that Mrs. Ashcraft was entitled to collect reasonable attorney’s fees because she was required to hire an attorney to collect the amounts to which she was entitled under provisions of the agreement. The trial court found that Mrs. Ashcraft was not entitled to attorney’s fees for her attorney’s efforts expended in defending Mrs. Ashcraft against the Appellants’ cross-actions.

In point of error twenty-three, the Appellants contend that the trial court erred in awarding Mrs. Ashcraft attorney’s fees in any amount because there is “no evidence” in this case allocating the time spent by the attorneys for Mrs. Ashcraft to the presentation of her claims against the Executrix and to the time spent in defense of the claims asserted by the Executrix and Kreidler-Ashcraft. We disagree.

Contrary to Appellants’ assertions, there is ample evidence in the record of time allocated by Mrs. Ashcraft’s attorneys solely to the recovery of her claims under the agreement. The original record, as well as a typed summary, of the time records kept by her attorneys was admitted into evidence. Although all of the listed items do not specifically set forth the exact nature of the work performed, most of the items do specify the particular issues of the case and the corresponding time spent on each issue. Much of the actual time spent was in the courtroom in front of the trial judge who was certainly in a position to determine what portion of the trial time was spent for what purpose. One of Mrs. Ashcraft’s attorneys testified, in addition, that a reasonable fee for the prosecution of such a collection case would be a one-third contingent fee, and that Mrs. Ashcraft was being charged on this contingency basis.

The remaining points of error, twenty-one and twenty-two attack the trial court’s action of granting Mrs. Ashcraft’s motion to file a post-trial amendment to her pleadings naming as defendant, Susie Ashcraft Pitts, Independent Executrix of the Estate of the decedent, over Appellants’ motion to dismiss the suit. Point of error twenty-two generally complains that the “trial court erred in finding as a fact that the Executrix voluntarily appeared and filed an answer in this proceeding.”

In her initial pleadings, Mrs. Ashcraft originally sought relief against “the Estate of James Buford Ashcraft, III, Deceased.” The citation issued against the “Estate” was served on Susie Ashcraft Pitts, Independent Executrix of the Estate of James Buford Ashcraft, III, Deceased. The Executrix filed an answer and thereafter, during the course of the trial, filed numerous other supplemental and amended pleadings wherein the introductory paragraph to such pleadings began: “NOW COMES Susie Ashcraft Pitts, Independent Executrix of the Estate of James Buford Ashcraft, III, Deceased, and files for such Estate . . ” In addition to answering Mrs. Ashcraft’s suit, “Susie Ashcraft Pitts, Independent Executrix of the Estate of James Buford Ash-craft, III, Deceased,” filed for such Estate an original “cross-action” and several supplemental and amended cross-actions seeking affirmative, declaratory, and injunctive relief, damages, and attorney’s fees. In addition, the preamble of the written stipulations agreed upon by the parties and entered into evidence during the trial, stated as follows:

“The following Stipulations are entered into by and between all parties hereto through their attorneys of record. The parties are Dorothy K. Ashcraft, Plaintiff; Susie Ashcraft Pitts, as Independent Executrix of the Estate of James Buford Ashcraft, III, Deceased, Defendant and Cross-Plaintiff; and the Intervenor, Krei-dler-Ashcraft Funeral Directors, Inc. The parties stipulate as follows, to-wit:

The record before us indicates that Susie Ashcraft Pitts, in her representative capacity, also participated in pre-trial discovery and settlement negotiations with Mrs. Ash-craft. Susie Ashcraft Pitts, as Independent Executrix, appeared at the trial and was represented by counsel to pursue affirmative relief on behalf of the Estate as discussed in part herein. The trial of the case took several days to complete, and the statement of facts of the transcribed proceedings as contained in seven volumes comprise over 1,000 pages. After the evidence closed, the trial judge sent to each party a proposed judgment indicating his intention to enter judgment in favor of Mrs. Ashcraft and against the Executrix in her representative capacity.

Thereafter, for the first time, “Susie Ash-craft Pitts, Independent Executrix of the Estate of James Buford Ashcraft, III, Deceased,” filed her objections to the entry of such judgment on the basis that Susie Ash-craft Pitts, Independent Executrix of the Estate “is not and has never been a defendant in the above entitled and numbered cause.”

Appellant’s major argument in support of these points of error is that Mrs. Ashcraft’s post-trial amendment to her pleadings contravened the express provisions of Rule 41, Texas Rules of Civil Procedure, which allows an amendment to the pleadings joining a party to the suit only up to the time of submission of the case to the trial judge, where the trial is without a jury.

We recognize the well settled rule that the “Estate” of a decedent is not a legal entity and may not sue or be sued as such. Price v. Estate of Anderson, 522 S.W.2d 690, 691 (Tex.Sup.1975). It has been generally stated that the mistake of filing a suit against an “estate” is not a mistake of fact concerning the correct name of the party intended to be sued, but rather, is a mistake of law concerning the party that should be sued to establish the liability of a decedent and collect the claim of the property belonging to his estate. Price v. Estate of Anderson, 522 S.W.2d 690, 692 (Tex.Sup.1975). Nevertheless, we are of the opinion that the express provisions of Rule 41 did not preclude the trial judge from permitting Mrs. Ashcraft to file a post-submission amendment to her pleadings in this case. This not the usual Rule 41 nonjoinder situation involving an estate where suit is brought against the “estate” alone and the official representative either does not appear or does not purport to participate as the representative of the estate after an appearance in another capacity has been made. Compare Scott v. Graham, 156 Tex. 97, 292 S.W.2d 324 (1956); Gray v. Bush, 430 S.W.2d 258 (Tex.Civ.App.—Fort Worth 1968, writ ref’d, n.r.e.); Hortenstine v. Jackson, 289 S.W.2d 613 (Tex.Civ.App.—Amarillo 1956, writ ref’d, n.r.e.).

The procedural rules give the trial court broad discretion in matters of joinder of parties, severance, separate trials, and consolidation of actions, and the trial court’s action in that regard will not be disturbed on appeal except for an abuse of discretion. Royal Petroleum Corp. v. Dennis, 160 Tex. 392, 332 S.W.2d 313 (1960); Rules 41, 66, 90 Texas Rules of Civil Procedure; Lambert v. H. Molsen & Co., Inc., 551 S.W.2d 151 (Tex.Civ.App.—Waco 1977, writ ref’d, n.r.e.); Cruz v. Guajardo, 502 S.W.2d 610 (Tex.Civ.App.—Corpus Christi 1973, no writ).

It is clear to us that the Executrix waived any complaint that she might have. She appeared in her capacity as official representative of the Estate and sought affirmative relief on behalf of the Estate against Mrs. Ashcraft. The Executrix was before the court in her official representative capacity. This was admitted as a fact by the terms of the stipulations, which were mutually agreed upon by all of the parties. The record demonstrates that the Executrix, in her representative capacity, participated fully in all stages of the proceedings. She now makes no attempt to show that the trial court’s action in allowing such an amendment was a surprise or otherwise harmed her in any way. We conclude that, under the facts and circumstances of this case, it was quite proper for the trial judge, and it was within his sound discretion, to determine that an amendment should be permitted prior to judgment naming as defendant the Executrix in her representative capacity for the Estate. If there was any error, it was harmless. Rule 434, T.R.C.P. Points of error twenty-one and twenty-two are overruled.

The judgment of the trial court is affirmed.


source: Caselaw Access Project

author: PER CURIAM.

license: Public Domain

text:
    Maurilia TERAN, Appellant, v. Dr. Ronald E. FRYER, Appellee.
    No. 1570.
    Court of Civil Appeals of Texas, Corpus Christi.
    Aug. 30, 1979.
    Rehearing Denied Sept. 21, 1979.
    Homero M. Lopez, Brownsville, for appellant.
    David H. Hockema, McAllen, for appel-lee.
   OPINION

PER CURIAM.

Appellant Maurilia Teran perfected her appeal from a take nothing judgment rendered February 28, 1979. The cause is before us on the jurisdictional question of whether the record was timely received.

The transcript shows that appellant filed an original motion for new trial on March 6, 1979. No amended motion was filed. A decision on April 18, 1979, to overrule the motion for new trial is reflected by a notation on the docket sheet and in a letter from the District Clerk to the attorneys of record advising them of such docket entry, but no written order was signed until June 13, 1979. In the meantime, appellant filed her cost bond on May 11, 1979. The transcript was received in this Court on August 3, 1979.

The record was due to be filed within sixty days after the overruling of appellant’s motion for new trial. Rule 386, T.R. C.P. If the order signed June 13, 1979, is valid, the transcript was received in time. Otherwise, it was late and we have no jurisdiction of the appeal.

The date of rendition of an order overruling a motion for new trial is the reference point for determining when the jurisdictional appellate steps must be completed. Rules 356 and 386, T.R.C.P. A unique characteristic of motions for new trial is that they may be overruled by either the action or inaction of the trial judge. Rule 329b(3) requires a motion for new trial to be determined within 45 days unless an agreement in writing for later determination is made within the provisions of that subsection. There is no other provision for a later rendition of an order overruling a motion for new trial. Absent a written agreement postponing the decision to a date certain, an order must be in writing and signed by the 45th day. Reese v. Piperi, 534 S.W.2d 329 (Tex.Sup.1976); Cardona v. Texas Employers’ Insurance Assoc., 566 S.W.2d 78 (Tex.Civ.App.—Corpus Christi 1978, writ ref’d n.r.e.). If no action is taken by the trial court by the end of the 45th day, the motion is overruled by operation of law automatically.

If, on the other hand, a ruling is made prior to the expiration of 45 days, the date of rendition must be determined in light of Rule 306a, which provides in part, “In determining the periods within which the various steps of an appeal must be taken, the date of rendition of a judgment or order shall be deemed to be the date upon which the written draft thereof was signed by the trial judge as stated therein.” An order orally announced in open court, noted on the docket sheet, or communicated in any other manner is therefore not “rendered” for purposes of determining the time for appellate steps. The time does not start to run until a formal order is signed. Failure to reduce the order to writing and sign it within the allotted 45 days causes the motion for new trial to be overruled by operation of law the same as if no ruling at all had been made. If this were not so, the delay in signing a written order could permit a trial court to enlarge the period for taking action on a motion for new trial in contravention of Rule 5. For a detailed analysis of the interaction among Rules 5, 306a, and 329b, see Risher v. Risher, 547 S.W.2d 292 (Tex.Civ.App.—Dallas 1977, writ dism’d). The cases uniformly hold that a motion for new trial is overruled either by formal order or by operation of law, whichever occurs earlier, and an order purporting to overrule a motion which has already been overruled by operation of law is a nullity. Reese v. Piperi, supra; Fulton v. Finch, 162 Tex. 351, 346 S.W.2d 823 (1961); Mapus v. Garza, 508 S.W.2d 857 (Tex.Civ.App.—San Antonio 1974, writ ref’d n.r.e.); Hendricks v. Williams, 485 S.W.2d 304 (Tex.Civ.App.—Corpus Christi 1972, no writ); Heldt Brothers Trucks v. Alvarez, 477 S.W.2d 691 (Tex.Civ.App.—San Antonio 1972, writ ref’d); Mercer v. Band, 454 S.W.2d 833 (Tex.Civ.App.—Houston (14th Dist.) 1970, no writ) (timely docket entry, but late formal order); Roth v. Maryland American General Insurance Co., 454 S.W.2d 779 (Tex.Civ.App.—San Antonio 1970, writ ref’d); Washington v. Golden State Mutual Life Insurance Co., 405 S.W.2d 856 (Tex.Civ.App.—Houston) aff’d 408 S.W.2d 227 (Tex.Sup.1966), cert. denied 386 U.S. 1007, 87 S.Ct. 1349, 18 L.Ed.2d 434 (1967).

In the case before us, the period during which the motion for new trial must have been determined expired 45 days after March 6, 1979, or on April 20, 1979. Since no formal order had been signed by the date, (April 20, 1979) the motion for new trial was overruled by operation of law. The order signed June 13, 1979, was of no effect. The transcript received August 3, 1979, was late. We have no jurisdiction and therefore have no choice but to dismiss the appeal.

Appeal DISMISSED.


text:
    ST. PAUL INSURANCE COMPANY, Appellant, v. Janis RAHN, Appellee.
    No. 1577.
    Court of Civil Appeals of Texas, Corpus Christi.
    Aug. 30, 1979.
    Rehearing Denied Sept. 21, 1979.

      Damon Ball, Thomas H. Crofts, Jr., Groce, Locke & Hebdon, San Antonio, for appellant.
    Thomas G. Sharpe, Jr., Brownsville, for appellee.
   OPINION

PER CURIAM.

St. Paul Insurance Company filed a petition in intervention on June 11, 1979, in a suit styled “Janis Rahn v. Jose Gomez, Richard Novigrod and the Bazaar Corporation of Brownsville,” Individually and Jointly, in which judgment had previously been rendered on May 18, 1979. At the same time, St. Paul also filed a motion to set aside the judgment and for a new trial on behalf of itself, and a similar motion on behalf of the Bazaar Corporation, pro forma. Janis Rahn filed a motion to strike the intervention on June 14, 1979. On the following day, the trial court denied the motions to set aside the judgment. St. Paul promptly filed an appeal bond on June 15.

The transcript was not tendered to the Clerk of this Court until August 13, 1979. It was marked received, but not filed, because the time for filing the record had apparently expired sixty days after judgment, or on July 17,1979. The attorneys of record were notified of the problem and the jurisdictional issue brought to our attention. (See Rule 389, T.R.C.P.) Appellant responded by filing a brief. Appellee has filed a motion to dismiss the appeal for want of jurisdiction and a brief in support of the motion. We conclude that since the record was not timely offered, the appeal must be dismissed.

The record was due in this Court within sixty days after the rendition of judgment on May 18, 1979, absent a time-filed motion for new trial. Rule 386, T.R.C.P. Motions for new trial, if filed, must be filed within ten days of the rendition of judgment. Rule 329b(l).

The motion to set aside judgment and motion for new trial were filed twenty-four days after the rendition of judgment. A trial court’s order overruling a late-filed motion for new trial cannot be the basis of appellate review, and this Court has no jurisdiction to consider the late-filed motion. Thomas v. Davis, 553 S.W.2d 624 (Tex.Sup.1977). Therefore, the record was due sixty days after judgment, or on July 17, 1979. Appellant did not timely file the transcript, nor has it filed a motion for extension of time pursuant to Rule 21c.

St. Paul argues in its brief, however, that the filing of its petition in intervention, albeit after the rendition of judgment, made it a party to the cause during a time when the trial court had plenary power over its judgment. It further reasons that because the previously rendered judgment did not dispose of its claim, the judgment could not be final and did not become final until June 15, 1979, when its claim was disposed of by order overruling its motion for new trial. This argument has no merit.

The trial court had plenary power over its judgment at the time St. Paul filed its petition and could, if it chose, vacate, modify, correct or reform the judgment or grant a new trial. Transamerican Leasing Company v. Three Bears, Inc., 567 S.W.2d 799 (Tex.Sup.1978); Rule 329b(5). But such power did not in any way impeach the finality of the May 18 judgment. The judgment disposed of all issues and parties before the court and was therefore final. North East Independent School District v. Aldridge, 400 S.W.2d 893 (Tex.Sup.1966). St. Paul was not a party to the suit at that time, and its subsequent petition in intervention could not serve to recharacterize a previously final judgment into an interlocutory order. Comal County Rural High School District No. 705 v. Nelson, 158 Tex. 564, 314 S.W.2d 957 (1958).

The trial court’s plenary power over its judgment also did not affect the time limits for filing the record in this Court. Only a timely-filed motion for new trial under Rule 329b(l) or an extension of time granted under Rule 21c can extend the due date past the sixty days from the date of judgment. Thomas v. Davis, supra.

Intervention is authorized by Rule 60. The right to intervene is given in furtherance of a speedy disposition of suits and to prevent multiplicity of actions. Mulcahy v. Houston Steel Drum Company, 402 S.W.2d 817 (Tex.Civ.App.—Austin 1966, no writ). The intervenor bears the burden to show a justiciable interest, legal or equitable, in the lawsuit, and the trial court has wide discretion in judging the sufficiency of the opposing party’s motion to dismiss the petition in intervention. Rogers v. Searle, 533 S.W.2d 440 (Tex.Civ.App.—Corpus Christi 1976, no writ); Armstrong v. Tidelands Life Insurance Company, 466 S.W.2d 407 (Tex.Civ.App.—Corpus Christi 1971, no writ); Mulcahy v. Houston Steel Drum Company, supra. But, where the petition in intervention is filed after judgment, the Supreme Court has held that Rule 60 does not apply. In Comal County Rural High School District No. 705 v. Nelson, 158 Tex. 564, 314 S.W.2d 957 (1958), a petition in intervention was filed after judgment, but before the expiration of thirty days, as in the case before us. There, the Court stated at 314 S.W.2d on page 957:

“In our opinion the State’s motion to intervene was not timely filed. The order of dismissal entered by the trial court on September 5th had become final subject only to the power of the Court within the following thirty days to set the order aside. Rule 329-b, Texas Rules of Civil Procedure. The respondent-taxpayers, had lost their right of appeal and to complain of the dismissal of their case. No plea of intervention could be filed in the cause until and unless the district judge set aside his order of dismissal and this he refused to do. We, therefore, are of the opinion that Rule 60, T.R.C.P., is inapplicable. Under the circumstances we conclude that the Court of Civil Appeals was without power to set aside the trial court’s judgment of dismissal.”

See also McLennan County v. American National Insurance Company, 457 S.W.2d 597 (Tex.Civ.App.—Waco 1970, writ ref’d n. r. e.); Campbell v. Jefferson, 453 S.W.2d 336 (Tex.Civ.App.—Tyler 1970, writ dism’d); Baronofsky v. Baronofsky, 404 S.W.2d 683 (Tex.Civ.App.—Houston 1966, writ dism’d); Mast v. Shipp, 123 S.W.2d 980 (Tex.Civ.App.—Beaumont 1939, writ dism’d, jdgmt. cor.).

We hold that the filing of St. Paul’s petition in intervention was not authorized under Rule 60, and it had no effect on the final judgment previously rendered. The late-filed motion for new trial had no effect on the appellate timetable. We have no jurisdiction of the appeal.

Appeal dismissed.


author: HALL, Justice.

text:
    Jack PRESCOTT et al., Appellants, v. LONE STAR LIFE INSURANCE COMPANY, Appellee.
    No. 5994.
    Court of Civil Appeals of Texas, Waco.
    Sept. 6, 1979.
    Rehearing Denied Sept. 27, 1979.

      Jack M. Anthony, Jr., Reese, Anthony & Tomlinson, Garland, Alvin Boyd, Dallas, for appellants.
    David K. Meyercord, Strasburger & Price, Dallas, for appellee.
   HALL, Justice.

Plaintiff Lone Star Life Insurance Company brought this suit against defendants Jack Prescott and Charlotte Prescott to recover an alleged deficiency balance due on a promissory note after the realty securing payment of the note had been sold at foreclosure under a deed of trust. Plaintiff pleaded that it was the owner and holder of the note. Defendants answered with a general denial. Kathleen White filed a petition in intervention. Lone Star filed its motion for summary judgment against defendants, and its motion to dismiss the intervention. After notice and hearing on the motions, the trial court, in separate orders, dismissed the intervention without prejudice and rendered summary judgment for plaintiff against defendants on the note. Intervenor and defendants appeal. We affirm the order dismissing the intervention, but we reverse the judgment against defendants.

It is stated in plaintiff’s petition that copies of the note sued upon and the deed of trust securing the note are attached to the petition and marked “Exhibit ‘A’ ” and “Exhibit ‘B,’ ” respectively, and made a part of the petition by incorporation. However, the note and the deed of trust are not in fact attached to the petition.

The only proof in the summary judgment record that plaintiff is now the owner and holder of the note is set forth in the affidavit of Bernard V. Carrico, Jr., plaintiff’s Investment Committee Chairman, as follows:

“My name is Bernard V. Carrico, Jr., and I am fully competent to testify herein. I am the Investment Committee Chairman of Lone Star Life Insurance Company, Plaintiff in the above numbered and entitled cause. I am fully authorized to execute this affidavit on behalf of Lone Star Life Insurance Company. Based on my own personal knowledge and information collected and made available to me from the records of Lone Star Life Insurance Company, I am fully aware and cognizant of all the facts set forth herein and do hereby swear that all of said facts and statements herein contained are true and correct.
“Lone Star Life Insurance Company is the legal owner and holder of the promissory note executed by Jack Prescott and Charlotte Prescott, for valuable consideration, attached as Exhibit ‘A’ to Plaintiff’s Original Petition herein. Exhibit ‘A’ is a true, accurate and complete copy of the original thereof.”

Carrico then continued in the affidavit to identify the deed of trust, which he stated was “attached as . Exhibit ‘B’ to Plaintiff’s Original Petition.”

Neither the original nor a copy of the note or trust deed was attached to the affidavit or to the motion for summary judgment.

Defendants objected to Carrico’s affidavit on the ground that the statements therein based upon Carrico’s “personal knowledge and information collected and made available” to him from plaintiff’s records were hearsay, and pointed to the fact that the actual records or proper copies thereof were not produced with the affidavit. Defendants have brought this hearsay objection forward as their first point of error for reversal of the summary judgment. We sustain that point.

Answering request for admissions, defendants acknowledged that they executed the note and the deed of trust, but there is no admission by them in the record that plaintiff is the present owner or holder of the note. Plaintiff’s allegation that it holds the note was placed in issue by defendants’ general denial, and it was an essential element of plaintiff’s cause of action. Alexander v. Houston Oil Field Material Company, 386 S.W.2d 540, 542 (Tex.Civ.App.—Tyler 1965, writ ref’d n. r. e.). Over defendant’s hearsay objection, plaintiff failed to make that proof either by producing the original note or by using an authenticated copy under the provisions of Rule 166-A(e), Vernon’s Tex.Rules Civ.Proc. The summary judgment was therefore improper. Texas National Corporation v. United Systems International, (Tex.1973) 493 S.W.2d 738, 741.

In her petition in intervention, White sought to have the foreclosure sale under the trust deed set aside on allegations that she owned an interest in the land, that she was not given notice of the sale, and that the sale price was grossly inadequate. She also pleaded an action for damages against defendant Jack Prescott allegedly caused by his “lack of due care” in defaulting on the note.

Rule 60, Vernon’s Tex.Rules Civ.Proc., provides in part that, “Any party may intervene, subject to being stricken out by the court for sufficient cause on the motion of the opposite party.” The court has wide discretion in deciding a motion to dismiss an intervention in order to protect the original parties from the disadvantages of intervention. Roberson v. Roberson, 420 S.W.2d 495, 499 (Tex.Civ.App.—Houston [14th Dist.] 1967, writ ref’d n. r. e.); Armstrong v. Tidelands Life Ins. Co., 466 S.W.2d 407, 412 (Tex.Civ.App.—Corpus Christi 1971, no writ). If the intervenor has no interest that can be affected by the proceeding or if his interest in the subject matter of the litigation is contingent or remote, he is not entitled to intervene. Rogers v. Searle, 533 S.W.2d 440, 442 (Tex.Civ.App.—Corpus Christi 1976, no writ); 44 Tex.Jur.2d 196, Parties, § 44.

In our case plaintiff Lone Star seeks to recover only on the promissory note executed by defendants Preseotts. Intervenor White was not a party to that note in any capacity, and no interest in it is asserted by her. In her petition in intervention she does not allege any interest or standing which would entitle her to recover in her own right on the note as a plaintiff or which would permit a recovery on the note against her as a defendant. The only interest alleged in her behalf was an interest in the trust deed property which had secured payment of the note. The disposition of title to the property is not an issue between plaintiff and defendants, and the judgment on their pleadings would not affect interve-nor’s alleged interest in the property in any respect.

We hold the court did not abuse its discretion in dismissing the intervention. See DeCato v. Krebs Construction, Inc., 410 S.W.2d 806, 808 (Tex.Civ.App.—Waco 1967, writ ref’d n. r. e.).

The summary judgment in favor of Lone Star against the Preseotts on the note is reversed, and that cause is remanded for trial. The order dismissing White’s plea of intervention without prejudice is affirmed.

The costs of this appeal are taxed one-half against Lone Star and one-half against White.


author: O’QUINN, Justice.

text:
    MOTOROLA, INC., Appellant, v. Bob BULLOCK, Comptroller of Public Accounts, et al., Appellees.
    No. 12973.
    Court of Civil Appeals of Texas, Austin.
    Aug. 8, 1979.

      Charlie D. Dye, Robert E. Morrison, Brown, Maroney, Rose, Baker & Barber, Austin, for appellant.
    Mark White, Atty. Gen., Diane Van Hel-den, Asst. Atty. Gen., Austin, for appellees.
   O’QUINN, Justice.

Motorola, Inc., first qualified to do business in Texas as an Illinois corporation in 1971, later formed a wholly owned subsidiary incorporated in Delaware, and thereafter the Illinois corporation was merged with the Delaware corporation, following which Motorola applied to do business in Texas as a Delaware corporation. After the Comptroller of Public Accounts performed audits on both the Delaware and the Illinois corporation, deficiency determinations were issued on March 12,1976, and March 19,1976, in the total amount of $97,399.07.

Motorola paid the deficiency assessments on March 30, 1976, accompanied by written protest, the usual procedure required preliminary to bringing suit for recovery of the taxes under Article 1.05, Title 122A, Taxation-General. Motorola failed to bring suit within 90 days after payment and protest under terms of Article 1.05(2), but instead immediately upon payment under protest initiated claim for refund with the Comptroller of Public Accounts under provisions of Article 1.11A.

After hearings before the Comptroller on claim for refund, followed by motions for rehearing, the Comptroller’s denial of refund became finally effective on March 9, 1977. Motorola filed suit next day in district court alleging payment of the franchise taxes under protest and its subsequent prosecution of claim for refund, and prayed for recovery of $97,399.07 to be paid “from the suspense fund maintained for that purpose.”

The State, acting through the Attorney General, filed a plea to the jurisdiction, along with other answer, on the ground that Motorola failed to file suit within ninety days after payment of the taxes under protest on March 30, 1976, as required by Article 1.05(2), and did not sue until March 10, 1977, more than ninety days after payment under protest.

The district court found (1) that Motorola failed to plead or to show compliance with Article 1.05; (2) that Section 19 of Article 6252-13a, V.A.T.S., does not confer jurisdiction on the courts to entertain appeals from decision of the Comptroller denying claim for refund under Article 1.11A. The court sustained the State’s plea to jurisdiction and ordered Motorola’s suit dismissed without prejudice.

Motorola brings two points of error under which contention is made that (1) section 19 of Article 6252-13a (Administrative Procedure Act) confers jurisdiction on the courts to entertain appeals from decisions of the Comptroller denying claims for refund of taxes and that (2) Motorola pleaded and showed compliance with Article 1.05 authorizing suits to recover taxes paid under protest. We will overrule the points of error and affirm judgment of the trial court.

After Motorola paid the tax under protest, a requirement under Article 1.05 prior to bringing suit against the State to recover the tax, Motorola turned from that course to pursue a claim before the Comptroller for refund under Article 1.11A. The Legislature enacted Article 1.11A in 1967, to become effective July 1, 1967, as an amendment to Acts of 1959, 56th Leg., 3rd C.S., p. 187, ch. 1, the Act which created the new Title 122A, Taxation-General. The obvious design or purpose of Article 1.11 A was to empower the Comptroller, upon his determination, to refund overpayment of certain taxes found to have been paid through mistake of fact or mistake of law, thereby relieving the Legislature of a time consuming burden each session in hearing claims made directly to the lawmakers.

The statute in essential part provides that the Comptroller, when he “ . determines that any person, firm or corporation has through mistake of law or fact overpaid the amount due the State on any tax collected or administered by the Comptroller . . . may refund such overpayment by warrant . . . from any funds appropriated for such purpose.” Art. 1.11A(2). (Emphasis added).

Prior to enactment of Article 1.11A, the Legislature had provided in Article 1.11 that the Comptroller, in the same situation of an overpayment, “ . . . may with the consent of the taxpayer credit . [the taxpayer] overpaying the tax with the amount of such overpayment.” Art. 1.11(2). (Emphasis added).

It is too clear to provoke debate that the Legislature intended that the Comptroller would have discretion, upon his determination, as to whether an overpayment had occurred through mistake of fact or law, and the Comptroller is limited under the statute to making refunds of overpayments arising only from mistake of fact or mistake of law.

The Legislature did not provide for an appeal from the Comptroller’s determination in refusing to make refund of taxes. It is the general rule, applicable under the facts of this case, that “There is no right of appeal from an administrative order unless the statute provides for appeal or unless the order violates a constitutional right or adversely affects a vested property right.” Hackney v. Meade, 466 S.W.2d 341, 342 (Tex.Civ.App. Austin 1971, writ ref’d n. r. e.); Stone v. Texas Liquor Control Board, 417 S.W.2d 385 (Tex.Sup.1967). We find in a claim for refund of overpayment of taxes no vested property right, nor do we perceive any constitutional rights adversely affected by the Comptroller’s refusal of a refund.

Motorola contends that section 19 of Article 6252-13a entitles Motorola “to a judicial review of the Comptroller’s decision denying . . . claim for refund of franchise taxes.” In an earlier case, decided by this Court this year, the contention was made that the Legislature, in section 19 of the Administrative Procedure Act, “ . . . clearly thought that it was expanding the remedies available to the citizens, and providing a procedure for judicial review in addition to, and as well as, any other preexisting statutory procedures.” (Emphasis added). That contention was rejected by this Court in Dan Ingle, Inc. v. Bullock, 578 S.W.2d 193 (Tex.Civ.App. Austin 1979, writ ref’d). The same contention was also overruled in Robinson v. Bullock, 553 S.W.2d 196 (Tex.Civ.App. Austin 1977, writ ref’d n. r. e.), cert. denied, 436 U.S. 918, 98 S.Ct. 2264, 56 L.Ed.2d 759 (1978).

Section 19 of Article 6252-13a, as a procedure statute, insofar as substantive rights accorded a litigant are concerned, falls into the same category as the Texas Rules of Civil Procedure promulgated by the Supreme Court. Rule 815 expressly provides that the Rules “ . . . shall not be construed to enlarge or diminish any substantive rights . . . ” and Rule 816 adds that the Rules “ . . . shall not be construed to extend or limit the jurisdiction of the courts . . . ” (All emphasis added).

Motorola argues further that section 19 of Article 6252-13a, being by its own terms “ . •. . cumulative of other means of redress provided by statute,” affords Motorola judicial review of adverse decisions made by the comptroller under Article 1.11A. In this connection Motorola insists that since the courts have held that Article 1.05 is not exclusive, Article 1.11 A “provides a remedy which is in addition and that it is entitled to judicial review of the Comptroller’s decision on its claim for refund under the provisions of the Administrative Procedure and Texas Register Act.”

Section 19(b) explicitly provides that “Unless otherwise provided by statute . ” the procedure shall be as set out following the opening statement. Further exceptions or reservations are found in 19(c) and 19(d) “If the manner of review authorized by law . . ■. ” calls for trial de novo, or “If the manner of review authoriz ed by law . . calls for other than trial de novo ; finally in 19(e) “The scope of judicial review of agency decisions is as provided by the law under which review is sought.” (All emphasis added). This Court in Robinson v. Bullock, supra, recognized that no real or substantial repugnancy exists between Article 1.05, which grants the taxpayer a substantive right and the remedial mode by which to question validity of a tax statute, and the general procedural route provided by section 19 under which appeals may be made from adverse rulings of state agencies. (553 S.W.2d 198, col. 1). The Legislature with laudable care sought to avoid conflict between the general procedure outlined in section 19 and any other statute or law, with final specification that the scope of judicial review of agency decisions would follow “the law under which review is sought.” Nowhere do we find an attempt to grant a substantive right not provided by other statutes or laws.

Although Article 1.11A limits availability of claims for refunds to payments made through mistake of fact or mistake of law, Motorola did not plead facts occurring under which payment was made by mistake, nor the law or laws bringing about payment by mistake. Motorola attacks the assessment of the franchise tax on both the Illinois and the Delaware corporation as unlawful, confiscatory, and discriminatory. Motorola prayed to recover judgment to be paid “from the suspense fund maintained for that purpose.” The suspense fund was authorized by the Legislature for holding in suspense taxes paid under protest pending judicial determination of suits brought pursuant to the procedure established by Articles 7057b and 7047j and more recently by Article 1.05.

The trial court properly declined to entertain this action as an appeal from the Comptroller’s decision denying Motorola’s claim for refund under Article 1.11A.

Under its second point of error, Motorola makes an alternative contention that the taxpayer fully complied with Article 1.05. Although suit was not brought, as the statute requires, within ninety days after payment of the tax under protest, Motorola argues that under provisions of Article 1.045 the ninety-day period did not begin to run until final determination of Motorola’s claim for refund under Article 1.11 A. Motorola points out that it filed suit the day after the Comptroller’s denial of refund became final, nearly one year following payment of the tax.

Article 1.045 has as its purpose the establishment of limitation periods for the assessment and collection of certain taxes by the Comptroller. Motorola relies on paragraph (E) of the statute dealing with “Suspension of Time for Litigation or Redeter-mination.”

The obvious purpose of paragraph (E) is to prevent the running of limitations on assessment and collection of taxes, as fixed by preceding paragraphs of the Article, pending litigation or redetermination “with respect to the amount of the tax in issue . ” The statute does not suspend or nullify the requirement of Article 1.05 that after payment of a tax under protest the taxpayer must file suit within ninety days, if suit for recovery of the tax is to be maintained against the state.

This Court reviewed the history of Article 1.045 in Lorenzo Textile Mills, Inc. v. Bullock, 566 S.W.2d 107, 109-10 (Tex.Civ.App. Austin 1978, no writ). In that case we pointed out that the Legislature, in enacting the statute, cited “. . .an urgent need for limiting the time for collection of taxes and limiting time for making refunds for overpayment of taxes so that the Comptroller and taxpayer both need not unduly retain books and records that are not needed . . . ” The suspension of periods fixed by statute in which the taxpayer must file suit following payment of a tax under protest is not provided by Article 1.045.

Article 1.05 created a right not existing at common law and prescribed a remedy to enforce the right, and the courts may act only in the manner provided by the statute which created the right. Union Central Life Insurance Co. v. Mann, 138 Tex. 242, 158 S.W.2d 477, 481 (1941); Robinson v. Bullock, supra; Dan Ingle, Inc. v. Bullock, supra. When suit is not commenced within ninety days after the taxes are paid under protest, the courts are without jurisdiction to entertain the suit. Stelter v. Calvert, 456 S.W.2d 202 (Tex.Civ.App. Austin 1970, no writ); Bullock v. Electro-Science Investors, Inc., 533 S.W.2d 892 (Tex.Civ.App. Austin 1976, no writ).

The judgment of the trial court sustaining the State’s plea to the jurisdiction and dismissing the suit without prejudice is in all things affirmed.


author: PALMORE, Chief Justice.

text:
    J. L. THOMAS, Movant, v. W. E. (Bill) LYONS, Respondent.
    Supreme Court of Kentucky.
    Sept. 11, 1979.

      William C. Jacobs, Lexington, for mov-ant.
    Richard E. Vimont, Timothy C. Wills, Yi-mont & Clay, Lexington, foi respondent.
   PALMORE, Chief Justice.

This is a proceeding in which the movant, J. L. Thomas, a candidate for nomination to the office of councilman for the 8th District of the Lexington-Fayette Urban County Government, sought to prevent the names of respondent, W. E. (Bill) Lyons, and Jacob R. Asher from appearing on the ballot as candidates for the same office in the May, 1979, primary election.

The action was brought in the form of a motion under KRS 118.176, a statute providing a summary procedure for challenging the good faith of a candidate “seeking party nomination or election as an independent,” etc. Thomas prevailed in the Fa-yette Circuit Court, but the Court of Appeals reversed on the ground that KRS 118.176 does not apply. Despite a provision of KRS 118.176(4) that “the order of the Court of Appeals or judgment thereof shall be final,” this court treated Thomas’s petition for relief under CR 76.36 as a motion for discretionary review and granted it.

The Lexington-Fayette Urban County Government is a governmental unit unlike any other in this state. It is governed largely by the provisions of its voter-approved comprehensive plan styled a “Charter.” See KRS 67A.010 et seq.; Pinchback v. Stephens, Ky., 484 S.W.2d 327 (1974); Holsclaw v. Stephens, Ky., 507 S.W.2d 462 (1974). Its powers and responsibilities are measured by those of the county or city of the highest class existing within the county at the time of the governmental reorganization. KRS 67A.060. Article 12.05 of the Charter provides that all election laws of the Commonwealth shall be applicable to the merged-government elections except as expressly provided to the contrary by the Charter.

The legislative powers of the urban county government are vested in an urban-county council of 15 members elected by the public on a nonpartisan basis. Article 12.02 of the Charter provides that the procedures for securing nomination to the council at a primary election shall be those set forth in KRS 89.440, except that no primary shall be held for a position for which there are no more than two applicants.

KRS 89.440 deals with primary elections in cities operating under the city-manager form of government. Lexington, before its governmental merger with Fayette County, was a city of the second class operating under the city-manager form of government. Insofar as they differ from cities operating under other forms of government, city-manager cities are governed by KRS 89.390-89.680, one of which statutes, KRS 89.400, provides that all laws otherwise applicable to cities of the second, third and fourth classes and not inconsistent with this series of city-manager statutes shall continue to apply to city-manager cities. Hence the Lexington-Fayette Urban County Government is subject to and has the benefit of all the laws that are applicable to cities of the second class unless they are inconsistent with KRS 89.390-89.680.

In accordance with KRS 89.440 and Article 4.04 of the Charter, urban-county council members are nominated through a nonpartisan primary designed to reduce the number of candidates on the November ballot to two for each office. To be eligible for nomination in a city of the second class, the applicant “shall, at least fifty-five (55) days before the day of the primary election, file with the county clerk a petition signed by at least one hundred (100) voters,” and it is this requirement that Lyons and Asher, according to the findings of fact made by the trial judge, did not meet.

There being no contention that the factual findings of the trial court were clearly erroneous, they are, of course, conclusive. CR 52.01. To put it another way, we begin with the conspicuous fact that Lyons did not comply with the eligibility requirements of the statute and was not a qualified applicant for nomination unless those requirements are invalid.

Lyons argues that the statutory requirement of 100 signatures violates the due process and equal protection clauses of the 14th Amendment, citing Illinois State Board of Elections v. Socialist Workers Party, 440 U.S. 173, 99 S.Ct. 983, 59 L.Ed.2d 230 (1979), in which the Supreme Court of the United States invalidated, under the equal protection clause, a state statute requiring more signatures on a nominating petition for a local office than would have been required on a similar petition for nomination to a statewide office. By analogy, he points out that in Kentucky an independent running in a partisan race for an office similar to that of an urban county council member needs only 20 signatures on his petition, cf. KRS 118.305(1)(e) and 118.-315(2), and that a candidate for judicial office in the 14-county judicial district embracing Fayette County need have but two signatures on a petition for nomination, cf. KRS 118A.060-070.

The Illinois statute applied to persons who wished to run as independents and to new political parties desiring to nominate candidates. The controversy arose and was decided in the context of partisan elections. That is, the burden of securing a large number of signatures was placed upon persons and organizations choosing to enter the field against established political parties and their candidates. We point this out because it is clear that the historic importance of new parties in the American political scheme, the free access of the public to their ideas, and vice versa, were substantial factors in the conclusion reached by the Supreme Court of the United States. In simple terms, this was a statute making it difficult for new voices and “outsiders” to gain a foothold in the market-place against the monopoly of an entrenched establishment. Hence the vital issue in that case was different from the constitutional issue raised in this case, in which no political parties are involved, there are neither insiders nor outsiders, and each candidate has the same burden as every other candidate.

We confess that in attempting to draw from the majority opinion in the Illinois State Board case an articulable rationale for application to other cases we encounter the same difficulty expressed in Mr. Justice Blackmun’s concurring opinion, 440 U.S. at 188, 99 S.Ct. at 992. Superficially, the court appears to have held the statute invalid because more signatures were required for local elections than for statewide elections. The only logical connection we are able to discern, however, between the local requirement and the statewide requirement is that the contrast illuminated the unreasonableness of the local requirement.

It seems to us that in order to determine whether a person is being denied equal protection of the laws it is necessary to make a comparison between two people or classes of people in relation to their respective enjoyment of the same privilege or protection. This, of course, necessitates identifying those who sit on the other side of the scales and what privilege or protection they are said to be enjoying that is denied to the complaining party. In the Illinois case, was it the potential outsider who wanted to make a statewide race, and had a lower hurdle to clear than his local counterpart in Chicago? Surely not. Logically, it had to be the established political parties and their candidates for election to local office, because they were the people who had ready access to an election process that was denied to any other person or party except through a petition bearing 35,947 signatures. In terms of equal protection, the difference between the unaffiliated would-be candidate or new party and the established parties and their candidates was not sufficient to justify such a disparity in their respective opportunities of access to the ballot. That the requirement for a statewide election was only 25,000 signatures certainly had much evidentiary significance bearing on the question of whether the more burdensome requirement for a local election was necessary or reasonable, but we cannot see how the statutory requirements for a statewide election can be treated as a maximum that cannot be exceeded for a local election without violation of the equal protection clause. That one must pay $1.00 per bag for oranges whereas another can buy apples for 10$ per bag does not raise an equal protection problem.

To bring this phase of the matter to a close, we do not' believe that the Supreme Court of the United States would apply its ruling in the Illinois State Board case to a nonpartisan primary election in which the signature requirements for all candidates are the same. Persons desiring to run in a regular election as independent candidates against assorted party-nominated and other candidates are not “similarly situated” with persons seeking nomination in a nonpartisan primary election, nor are candidates for judicial office, who must, of course, meet certain qualifications beyond mere residence and supporting signatures.

The record before us does not include the evidence heard by the trial court. Hence we do not know what it disclosed with respect to the population of the districts from which urban-county council-members are elected. There is, however, no contention that the requirement of 100 signatures is or would be an unduly burdensome obstacle in any district. If it were, its ultimate effect on the elective process probably would run afoul of our own constitutional guaranty of free elections, Const. Sec. 6. Short of that possibility, a statutory requirement that an independent candidate produce evidence of a “significant modicum of support” in the form of a minimum number of voter-signatures in order to have his name placed on the ballot is not unconstitutional. Cf. American Party of Texas v. White, 415 U.S. 767, 789-790, 94 S.Ct. 1296, 39 L.Ed.2d 744 (1974).

We come now to the real problem in the case, which is whether KRS 118.176 was an authorized vehicle for Thomas to employ in challenging the right of another candidate to run in the primary election. That issue was raised by Lyons in the trial court, and the basis of the decision of the Court of Appeals reversing the judgment of the trial court was that KRS 118.176 does not apply. It is here that we encounter the difficulty of determining whether statutes drafted for cities with different forms of government from the urban-county government are nevertheless applicable by virtue of KRS 67A.060 and Article 12.05 of the Charter.

As we have mentioned already, these provisions tie the urban-county government to the election laws applicable to cities of the second class operating under the city-manager form of government.

Lyons’ argument that KRS 118.176 was not applicable to this primary election rests on an analysis of its wording and the history and wording of KRS 118.105(4), the latter of which provides, “This section does not apply ... to candidates for mayor or commissioner in cities of the fourth class operating under the commission form of government and in cities of the second, third or fourth class operating under the city manager form of government.”

KRS 118.176 was enacted in 1974 (Ch. 130, Sec. 107, Acts of 1974). As a part of the same enactment (Sec. 100), what had formerly been KRS 119.020 was transferred to KRS Ch. 118 and became KRS 118.105. As it had in KRS 119.020, paragraph (4) of KRS 118.105 began with the words, “This chapter does not apply . . . ” (Emphasis added.) The word “chapter” as it thus appeared was changed to “section” by Ch. 384, Sec. 25, Acts of 1978, which was an enactment of 584 sections making numerous technical corrections in the Kentucky Revised Statutes.

In Thompson v. Kenton County Board of Election Commission, Ky., 535 S.W.2d 68 (1976), an unsuccessful candidate for nomination to the office of city commissioner for Covington, a city of second class operating under the city-manager form of government, brought an action to invalidate the primary in which he had been defeated. Citing KRS 120.055, which provided for an election contest by a candidate for nomination at a primary held under KRS 118.015 to 118.035 and KRS 118.105 to 118.255, this court pointed out that KRS 118.105(4), as it then read, excepted city-manager cities of the second class from the applicability of the “chapter,” hence there was no statutory authority for the contest of a primary election in such cities.

KRS 120.055 was later broadened (Ch. 199, Sec. 3, Acts of 1976) to include “any candidate for nomination to a city office at a primary election for which the statutes do not otherwise provide for determining contest elections” (sic), and Lyons contends that this, rather than KRS 118.-176, was the proper remedy for Thomas in this case. For one rather fundamental reason we are unable to agree. KRS 122.055 is an election-contest statute, and Thompson was an election-contest case. Properly speaking, an election cannot be “contested” before it is held. An “election contest” is a post-election proceeding. What we have in this case is not an election contest, but a pre-election proceeding challenging the right of a purported candidate to participate in a primary election. Neither KRS 120.055 nor the Thompson case is relevant.

When the events of this case occurred the word “chapter” as it appeared in KRS 118.105(4) had been changed to “section.” Counsel for Lyons makes a persuasive argument for the proposition that the word “section” as now contained in this paragraph really was intended to mean KRS 118.105 to 118.255, to which the Legislative Research Commission has assigned the heading “Primaries,” whereas it has placed the remainder of Chapter 118 under the heading “Regular Elections.” This very well may have been the reviser’s intention, but we cannot and do not believe that such a misuse of a well-understood and much-used term of its own peculiar trade would flow from the pen of so expert a draftsman. If the word “section” had been intended to cover the series of sections suggested by Lyons, the customary way for LRC to do it would have been to use “KRS 118.105 to 118.255” instead of “section.” It is our opinion that the word “section” as used in KRS 118.105(4) must be construed to mean “section,” which denotes a single, numbered statute.

We have had more difficulty with the wording of KRS 118.176. At first impression the words “any candidate seeking party nomination or election as an independent” would appear to embrace two classes of candidates, (1) one seeking party nomination in a primary and (2) one seeking to be placed on the ballot in a regular election as an independent. This, of course, would completely exclude applicants for nomination in a nonpartisan primary, which, considering the number of cities in Kentucky that elect their governing officers through that process, would be a puzzling omission indeed. We conclude, rather, that in this particular context the expression “election as an independent” was intended to and should be construed as referring to primary elections, and the only “independents” who run in primary elections are those who run in nonpartisan primaries. It follows that KRS 118.176 was applicable and available to Thomas in this instance.

Lyons makes a further argument to the effect that the “substantial compliance” rule should be applied in his favor. To apply that principle to the number of signatures required would amount simply to an unauthorized amendment of the statute. We must respectfully decline the invitation.

One more point, though not argued, bears mention. To the extent that KRS 118.176(4) provides that the action .of the Court of Appeals shall be final runs athwart Const. Sec. 110(2)(b), which authorizes the Supreme Court to exercise appellate jurisdiction as provided by its rules.

Lyons and Asher having been ineligible to run in the primary, the two remaining candidates are entitled to have their names placed on the ballot in the regular election. The judgment of the trial court may be amended to that effect.

The decision of the Court of Appeals is reversed and, subject to such amendment as is necessary in view of the transpiration of the primary election, the judgment of the trial court is affirmed.

All concur.

      . Asher did not contest the action in the trial court and is not a party to this review.

      . For reasons not here pertinent, the trial court struck 12 of the 102 names signed on the Lyons application.

      . In a local election the minimum requirement was a number equal to 5% of the number of votes cast at the previous election, which in the instance of Chicago amounted to 35,947 signatures. In contrast, for a statewide election the requisite number of signatures was 25,000.

      . That KRS 118.176 falls within the portion of KRS Ch. 118 entitled “Primaries” may lend a degree of support to this conclusion.


author: REED, Justice.

text:
    LOUISVILLE MEMORIAL GARDENS, INC., Movant, v. COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Respondent.
    Supreme Court of Kentucky.
    Sept. 11, 1979.
    Albert F. Reutlinger, Louisville, for mov-ant.
    Ed W. Hancock, Asst. Atty. Gen., Dept, of Transp., Frankfort, Jack M. Lowery, Jr., Louisville, for respondent.
   REED, Justice.

This is a condemnation action. The Commonwealth took about 1.09 acres of movant cemetery’s land for a highway improvement project. The Jefferson County Court adjudged that the Commonwealth could take possession of the land upon payment of $159,500.00, the amount awarded by the county court’s appointed appraisers. In September 1970, the cemetery appealed to the Jefferson Circuit Court on the ground that the county court’s award was inadequate.

After the dispute reached circuit court it was tried three times. The first trial was aborted upon joint motion of the adversary parties. The second trial resulted in a jury award of $119,000.00, but the trial judge set aside the jury verdict and granted the cemetery’s request for a new trial. The third trial ended with a jury award of $207,-000.00. From a judgment in accordance with this result, the Commonwealth appealed to the Court of Appeals where the judgment was reversed with direction that the judgment entered in the second trial in the amount of $119,000 be reinstated. We granted the cemetery’s motion for discretionary review of the decision of the Court of Appeals. We affirm the decision of the Court of Appeals for the reasons later stated.

The Court of Appeals agreed with the Commonwealth’s contention that the trial judge erred in granting the cemetery’s motion for a new trial made at the conclusion of the second trial. The Court of Appeals stated the basis for its decision: “The verdict of the jury is within the range of the values testified to by the witnesses. . The verdict of the jury at the second trial being within the scope of the evidence and being not so inadequate as to show passion and prejudice, the trial court abused its discretion in substituting its judgment for that of the jury.” We agree that the trial court committed reversible error in voiding the verdict rendered at the second trial, but for a different reason from that expressed by the Court of Appeals.

When all the side skirmishes are put aside, the decisive consideration appears clearly. That decisive consideration is the action of the trial court in assuming to assess the credibility of the testimony of the Commonwealth’s appraisal witness, McDon-ogh, when the assessment of the weight to be afforded to his evidence was left to the province of the jury.

McDonogh in 1969 appraised the difference in market value before and after taking at approximately $158,000. At the second trial in 1972 he had reduced his appraisal of this difference to approximately $80,000. This changing of McDonogh’s conclusion was fully explored on cross examination. The jury was given the full picture. The trial judge did not strike this testimony nor did he admonish the jury not to consider it.

At the conclusion of the third trial, the trial judge overruled the Commonwealth’s motion for a new trial and filed a written statement in which he specified his reasons for granting a new trial at the conclusion of the second trial.

In this statement the trial judge stated: “I granted a new trial in this case because the amount of the verdict was substantially less than the $159,000 awarded by the commissioners; and secondly, because of the lack of credibility of the Highway Department’s witnesses. The principle [sic] witness for the Highway Department, as far as I am concerned, is a thoroughly discredited witness who has shown in this case a willingness to prostitute himself at the behest of the Highway Department . . . .”

This court discussed the reviewability of the action of a trial judge in granting a new trial in City of Louisville v. Allen, Ky., 385 S.W.2d 179 (1964). Therein we recognized these general guidelines: (1) the matter of granting a new trial is within the discretion of the trial judge, (2) he will not be reversed on appeal unless there is an abuse of discretion, (3) the appellate court is more reluctant to reverse an order granting a new trial than one denying it. In overruling to an extent the case of Commonwealth, Dept. of Highways v. Citizens Ice and Fuel Co., Ky., 365 S.W.2d 113 (1963), the Allen court said: “Even if in our opinion the record would more strongly support a different conclusion, if there is substantial reason for his decision, then he has not clearly erred.” Allen, supra at 184. The key words are “substantial reason.”

The written statement of the trial judge reveals that he acted without “substantial reason.” His conclusion that the verdict should be voided because it was less than the appraisal made by the, county court commissioners manifests plain error. According to his statement, the principal reason for voiding the verdict was his disbelief of the testimony of one of the Highway Department’s appraisers. This clearly usurped the function of the jury to which the issue of weight and credibility had been committed. Therefore, the record affirmatively demonstrates that the voiding of the verdict was without “substantial reason.” Since the record is clear and specific, there is no need to speculate about intangible elements “outside the record.” No discretion is so broad that it does not have boundaries. In this case the boundaries were transgressed.

The decision of the Court of Appeals is affirmed, and the case is remanded to the Jefferson Circuit Court for entry of a new judgment reinstating the verdict rendered at the second trial of this case.

All concur, except CLAYTON, J., who dissents.


text:
    COMMONWEALTH of Kentucky, Movant, v. Ray DUVALL, Respondent.
    Supreme Court of Kentucky.
    Sept. 18, 1979.
    Robert F. Stephens, Atty. Gen., Elizabeth E. Blackford, Asst. Atty. Gen., Frankfort, for movant.
    Marvin B. Coles, James E. Boyd and William L. Brooks, Coles, Boyd & Brooks, Frankfort, for respondent.
   OPINION AND ORDER

The motion of the Commonwealth of Kentucky for a review of the decision of the Court of Appeals is granted.

The decision of the Court of Appeals rendered January 19, 1979, is now vacated, and this proceeding is remanded to the Court of Appeals for reconsideration in light of Kentucky v. Whorton, - U.S.-, 99 S.Ct. 2088, 60 L.Ed.2d 640 (1979), and this court’s opinion in Whorton v. Commonwealth, Ky., 585 S.W.2d 388 (1979).

All concur.