author: YOUNG, Justice.

text:
    Neil F. INNES, Appellant, v. Hulon WEBB, Appellee.
    No. 1028.
    Court of Civil Appeals of Texas, Corpus Christi.
    June 10, 1976.
    Rehearing Denied June 30, 1976.

      J. Perry Jones, Adams, Graham, Lewis, Jenkins, Jones & Graham, McAllen, for appellant.
    Wilkins & Wilkins, McAllen, for appellee.
   OPINION

YOUNG, Justice.

This is a suit by a purchaser against a real estate broker for the return of his earnest money under a contract of sale that was not completed because of the fault of the seller. In a non jury trial, the trial court rendered judgment for the plaintiff, among other things, for the $2,000.00 earnest money sought, plus $500.00 as attorney’s fees. The record shows neither a request for nor a filing of findings of fact or conclusions of law. The defendant broker appeals.

In his petition Hulon Webb alleged that Neil F. Innes, doing business as Innes Realty, prepared an instrument dated August 21,1974, purporting to be an earnest money contract between Webb and Herbert Huller for the purchase of a residence to be constructed by Huller upon a certain described lot in McAllen; that the contract contained the following provision:

“If title is found objectionable and is not cleared within a reasonable time, upon failure of Seller to comply herewith for any reason, Purchaser may demand back the earnest money, thereby releasing Seller from this contract, or Purchaser may enforce specific performance hereof or seek such other relief as may be provided by law.”

Plaintiff further alleged that he gave his check of $2,000.00, payable to Innes Realty, Trustee, to be held by Innes as stakeholder subject to plaintiff’s demand for the return of that sum if the seller should fail to comply with the contract; that the seller was unable to perform; that, therefore, plaintiff demanded the return of his deposit; and that defendant refused to return the deposit. Plaintiff also sought attorney’s fees.

Innes answered, among other things, that he turned the escrow money over to Huller in accordance with the clause in the contract which reads, in part, as follows:

“2,000.00 escrow to be turned over to Seller for initial deposit for materials and administrative costs . . . ”

At the trial the questioned contract was introduced into evidence. The contract is a printed form with blanks for appropriate interlineations. At the top of the instrument is the heading: “TEXAS STANDARD FORMS, EARNEST MONEY CONTRACT, CONVENTIONAL”. Typewritten in were the names of the purchaser and the seller; the description of the property; the price to be paid. Then followed several printed clauses covering matters such as terms; closing; title insurance; default of the parties; broker’s fee (with amount typewritten in); loss (fire and casualty); and special notices about several matters, one of which is that the instrument is the complete agreement of the parties. The default of the parties’ clause contained the printed provision about return of earnest money. This is the clause that plaintiff alleged Innes breached.

Then follows a typewritten clause about turning the $2,000.00 escrow over to the seller. This is the last clause and the one on which defendant relies to avoid liability.

The record reflects that the contract was signed by Huller and Webb during the evening of August 21, 1974. On the same evening Webb delivered his $2,000.00 check to Innes payable to “Innes Realty, Trustee”. The next day Innes endorsed the check over to Huller. Subsequently, Huller left town and no further action was taken on the contract. Webb then brought this suit against Innes to recover the $2,000.00. Thereafter the trial court awarded judgment in favor of Webb. The appeal by Innes is from that judgment.

In his first and second points of error, the appellant contends that the trial court erred in awarding judgment for the appellee because there is no basis in law or fact for the award and, more specifically, because appellant had no duty under the contract to hold the $2,000.00.

All of which brings us to the construction of a contract that was prepared by a broker and that contains two apparently inconsistent clauses: one, a printed clause, requiring the return by the broker to the purchaser of the earnest money on purchaser’s demand if the seller fails to comply with the contract; and the other, a typewritten clause, requiring the broker to turn over the “$2,000.00 escrow” to the seller “for initial deposit for materials and administrative costs.” Appellant urges that we should be guided here by the rule of construction which provides that the written or typewritten part of a contract controls in the event of any conflict thereof with the printed portion of the contract. This rule is set out in 13 Tex.Jur.2d Contracts § 144 (1960). The rationale for this rule is that the written or typed words are the immediate language of the parties themselves, whereas the language of the printed form is intended for general use only, without reference to the particular aims and objectives of the parties. Leslie Lowry & Co. v. KTRM, Inc., 239 S.W.2d 898, 900 (Tex.Civ.App.—Beaumont 1951, no writ); 13 Tex.Jur.2d Contracts § 144, supra.

On the other hand, appellee contends that our case should be controlled by the rule which requires that an agreement be construed most strictly against the party who drafted it and thus was responsible for the language used. This rule can be found in 13 Tex.Jur.2d § 121 (1960).

When we attempt to apply these rules to our case, we find that we apparently have two conflicting rules urged by the parties. The question then arises which rule should prevail here. Our answer to that question is that the rule should be applied which says typed matter controls the printed instead of the rule which says that a contract will be construed against the author. Universal C.I.T. Credit Corp. v. Daniel, 150 Tex. 513, 243 S.W.2d 154 (1951); Leslie Lowry & Co. v. KTRM, Inc., supra; 17A C.J.S. Contracts § 324, p. 217.

The rule of strict construction against the author has been dealt with in those authorities as follows: In Daniel, our Supreme Court held that the rulé applies only after ordinary rules of interpretation (such as the typed controls the printed) have been applied. In KTRM, Inc., that Court simply applied the typed controls the printed rule over the authorship rule. In 17A C.J.S., the statement is made that the authorship rule is the last one the courts will apply.

For all of those reasons, we hold that the typewritten clause in the contract determines the responsibility of the appellant for his disposition of the “$2,000.00 escrow”; that he delivered that money to the seller under the clause; that, therefore, he did not breach the contract in so delivering the money. Appellant’s first and second points are sustained.

In his third and fourth points, the appellant asserts error by the trial court in its award of attorney’s fees, because there is no contract provision for those fees, nor was there any evidence submitted on the reasonableness of those fees.

Unless provided for by statute or by contract between the parties, attorney’s fees are not recoverable in Texas. Turner v. Turner, 385 S.W.2d 230 (Tex.Sup.1964); Clark v. Wisdom, 403 S.W.2d 877 (Tex.Civ.App. — Corpus Christi 1966, writ ref’d n. r. e.). The parties here made no provision for attorney’s fees in their contract. Nor do the provisions about attorney’s fees in Tex. Rev.Civ.Stat.Ann. art. 2226 (Supp.1975), apply because this is a suit for breach of contract and not a claim for any of the items mentioned in that statute. Further, no evidence was submitted to the trial court about what services were rendered by the appellee’s attorney. For all of those reasons, appellant’s third and fourth points are sustained.

The judgment of the trial court is reversed and it is here rendered that the appellee take nothing.


source: Caselaw Access Project

author: NYE, Chief Justice.

license: Public Domain

text:
    MACPET, Appellant, v. OIL FIELD MAINTENANCE COMPANY et al., Appellees.
    No. 1084.
    Court of Civil Appeals of Texas, Corpus Christi.
    June 10, 1976.

      N. Wyatt Collier, Dohoney, Collier, Cartwright & Wandel, Houston, for appellant.
    Lev Hunt, Kleberg, Mobley, Lockett & Weil, Corpus Christi, Robert P. McGuill, Refugio, for appellees.
   OPINION

NYE, Chief Justice.

This is a venue suit. Oil Field Maintenance Company brought suit against MAC-PET, who was domiciled in Harris County, Texas, upon a debt alleged to be due and owing to Oil Field Maintenance Company. The suit was filed in Refugio County, Texas. MACPET duly filed its plea of privilege to be sued in Harris County, the county of its residence. Oil Field Maintenance Company controverted the plea of privilege alleging venue was maintainable in Refugio County under Subdivisions 5, 23 and 29a of Article 1995, Tex.Rev.Civ.Stat.Ann. MAC-PET’s plea of privilege was overruled by the trial court, from which order and ruling it brings this appeal.

The record shows that Padre Drilling Company had originally contracted to drill an oil well (Griffith # 2) located in Calhoun County for MACPET. The well location became impassable due to heavy rains caused by Hurricane Fern. Padre Drilling Company’s employee, M. A. Bowling, received permission from MACPET to obtain a bulldozer to pull in their equipment at the drilling site. Upon receiving the “go ahead” from MACPET, Padre Drilling Company called Oil Field Maintenance Company and employed them to furnish the bulldozer at the particular well site. Bowling told Oil Field Maintenance Company that MACPET would pay them for their services. Oil Field Maintenance Company’s daily time sheets were signed by Bowling and other employees of Padre Drilling Company. After the work had been completed, as instructed by Bowling, Oil Field Maintenance Company sent to MACPET an invoice covering the services rendered by them. The invoices covered services beginning September 11, 1971, and ending September 29,1971, for a total bill of $6,316.50. At the top of the invoice typed in specially, it stated: “This invoice to be paid in Refugio County, Texas.”

Upon receipt of this invoice, MACPET wrote to Oil Field Maintenance Company and stated that in regard to the invoice it was their understanding that they (MAC-PET) would be charged for the use of the equipment on the basis of actual time used and not for all the days the equipment was at the job site. The letter stated: “Time for many of the days shown covers time that the equipment was not in use. We will appreciate either re-issuing this invoice on the basis of actual time of equipment in use or issuing credit memo for the difference between this time and the time charged.” This letter was signed by Mr. Britton of MACPET and was introduced into evidence.

Thereafter, another letter was received by Oil Field Maintenance Company from MACPET again in regard to the original invoice. MACPET stated that they had talked to Mr. Bowling of Padre Drilling Company regarding the agreement and in which MACPET advises that the agreement was that they (MACPET) would pay for the equipment on the basis of actual time that the equipment was in use. The letter then outlines the invoice and shows where the dispute, as to the time the equipment was used, arises.

Again, on May 11, 1973, MACPET wrote Oil Field Maintenance Company reiterating their agreement between Padre Drilling Company’s tool pusher, M. A. Bowling, Oil Field Maintenance Company and itself. The letter stated in part:

“Mr. Bowling called me on September 12, 1971, advising that the condition of the road to the rig was such that trucks could not get in to the rig and requested permission to hire a bulldozer to pull in supply trucks. I agreed to this request, but only gave permission to use a dozer to pull in equipment on September 12 and 13. We authorized no further use of a dozer until September 25, when Mr. Joe Corpening authorized such use to pull in logging trucks and casing to the location.
MACPET therefore authorized and is only obligated to pay for the bulldozer during its use of 5 hours on September 12 and 10 hours on September 13. We are also obligated to pay for the use of the dozer for 18 hours on September 25.
* ⅜ * * *
We can only be responsible for the work which we authorized. . . . ”

Thereafter, Oil Field Maintenance Company brought suit against MACPET and Padre Drilling Company. (Padre did not file a plea of privilege and is actually an appellee in this appeal.) MACPET filed its plea of privilege to be sued in the county of its residence, Harris County, alleging that there was no exception to the exclusive venue. Thereafter, Oil Field Maintenance Company filed its controverting plea claiming that venue was proper in Refugio County under the provisions of Subdivisions 5, 23 and 29a of Article 1995, Tex.Rev.Civ.Stat. Ann.

Subdivision 5 of Article 1995, supra, provides:

“5. Contract in writing.—If a person has contracted in writing to perform an obligation in a particular county, expressly naming such county, or a definite place therein, by such writing, suit upon or by reason of such obligation may be brought against him, either in such county or where the defendant has his domicile.”

In order to maintain venue under Subdivision 5 of Article 1995, Tex.Rev.Civ.Stat. Ann., the plaintiff must prove: 1) an obligation in writing; 2) the execution by the defendant; and 3) that it is performable in the county of the suit. Public Service Life Insurance Company v. Copus, 494 S.W.2d 200 (Tex.Civ.App., Tyler 1973, no writ); Hess v. Young, 160 S.W.2d 574 (Tex.Civ.App., Waco 1942, no writ); Pitt Grill, Inc. v. Albert, 432 S.W.2d 160 (Tex.Civ.App., Dallas 1968, no writ). Proof of the existence of the cause of action is not required. Petroleum Producers Co. v. Steffens, 139 Tex. 257, 162 S.W.2d 698 (Tex.Com.App.1942, opinion adopted); Public Service Life Insurance Company v. Copus, supra.

The trial was before the court without a jury. No findings of fact or conclusions of law were requested or made. In testing the validity of the trial court’s judgment, we assume that the trial court found every disputed fact in such a way as to support its judgment. Construction And General Labor Union, Local No. 688 v. Stephenson, 148 Tex. 434, 225 S.W.2d 958 (1950); Renfro Drug Co. v. Lewis, 149 Tex. 507, 235 S.W.2d 609 (1951).

MACPET contends in effect that there was no written contract for performance by MACPET of any obligation in Refugio County and that MACPET did not recognize, acquiesce or agree to Oil Field Maintenance Company’s claim to be paid in Refugio County.

It is not necessary in order to constitute a “contract in writing” that the agreement be signed by both parties. One party can make an offer, the other can acknowledge it in writing and his acceptance by his act, conduct or acquiescence completes the agreement. Public Service Life Insurance Company v. Copus, supra; Trans-South Hydrocarbons v. Trinity Industries, Inc., 419 S.W.2d 662 (Tex.Civ.App., Dallas 1967, no writ); Vinson v. Horton, 207 S.W.2d 432 (Tex.Civ.App., Texarkana 1947, no writ); Dowdell v. Ginsberg, 244 S.W.2d 265 (Tex. Civ.App., Fort Worth 1951, no writ); Harrison v. Facade, Inc., 355 S.W.2d 543 (Tex.Civ.App., Dallas 1962, no writ).

There have been a number of cases that have been decided under Subdivision 5 of Article 1995 involving written invoices which contained the statement relating to the payment of the account in a designated county. Where the party seeking to maintain venue under Subdivision 5 proves that the written invoice itself is a part of the consummated contract, then the statutory exception (Subdivision 5) is made applicable. See Public Service Life Insurance Company v. Copus, supra; Hurlbut v. Lyons, 405 S.W.2d 398 (Tex.Civ.App., El Paso 1966, writ dism’d); Vinson v. Horton, supra; Dowdell v. Ginsberg, supra; Harrison v. Facade, Inc., supra. See also Barnwell v. Fox & Jacobs Construction Company, 469 S.W.2d 199 (Tex.Civ.App., Dallas 1971, no writ).

Here, Padre Drilling Company’s agent contacted Oil Field Maintenance Company to do some work for MACPET. Oil Field Maintenance Company did the work for MACPET, invoicing them for the use of the equipment at a specified price payable in Refugio County. The signed letters, together with the invoice, (“payable in Refugio County”) consummated a written agreement between MACPET and Oil Field Maintenance Company; i. e., Oil Field Maintenance Company was to furnish certain men and equipment, at a specified place, and at a definite price per hour, with such obligation being payable in Refugio County and only the number of hours that were to be charged for the equipment used was in dispute.

The justness of the account which is the subject of the specific dispute in this lawsuit is not before this Court at this time. The question of the amount owed by MAC-PET to Oil Field Maintenance Company is, of course, the subject of a defensive plea by MACPET that will be reached on the merits of the case. It is not subject to inquiry at the venue hearing. It is the rule that in an action on a written obligation performable in the county where suit is filed, disputed matters which go to the merits of the cause of action will not be inquired into at the hearing on the question of venue only. Harvey v. Bain, 140 Tex. 375, 168 S.W.2d 234 (Tex.Com.App.1943, opinion adopted); Harry Newton, Inc. v. H. Richards Oil Company, 385 S.W.2d 893 (Tex.Civ.App., Austin 1965, no writ). Bee also Ocean Systems, Inc. v. Educational and Research Devices, Inc., 493 S.W.2d 641 (Tex.Civ.App., Amarillo 1973, writ dism’d); VanHuss v. Buchanan, 508 S.W.2d 412 (Tex.Civ.App., Fort Worth 1974, writ dism’d).

At the venue hearing, all that Oil Field Maintenance Company had to prove was an obligation on the part of MACPET to pay them; that the obligation to pay was in writing and signed by MACPET; and finally, that such obligation was payable in Refugio County. All of these conditions have been met.

There are a number of cases in which the invoice relied upon for venue purposes came after the contract was completed. The completed contract may not be enlarged or altered later (without a new and independent consideration) to include a venue provision by a later invoice. See Barnwell v. Fox & Jacobs Construction Company, supra; Knapp Corporation v. Lofland Company, 466 S.W.2d 847 (Tex.Civ.App., Dallas 1971, no writ); Trans-South Hydrocarbons Company v. Trinity Industries, Inc., supra; K. T. Lease Service, Inc. v. Alamo Welding & Boiler Works, Inc., 431 S.W.2d 58 (Tex.Civ.App., San Antonio 1968, no writ); Ferguson v. Sanders, 133 S.W.2d 806 (Tex.Civ.App., Dallas 1939, no writ); Back v. Radio City Distributing Co., 286 S.W.2d 672 (Tex.Civ.App., Dallas 1956, writ dism’d); West Flour Mill, Inc. v. Vance, 430 S.W.2d 232 (Tex.Civ.App., Tyler 1968, writ dism’d).

For the reasons stated, we are of the opinion that there was sufficient evidence for the trial court to (impliedly) find that by the invoice and the signed letters, the defendant had obligated itself to Oil Field Maintenance Company in writing and had agreed to pay for such obligation in Refugio County, Texas. Hurlbut v. Lyons, supra; Public Service Life Insurance Company v. Copus, supra; Harrison v. Facade, Inc., supra.

It is not necessary for us to consider the other venue exceptions. The judgment of the trial court is AFFIRMED.


author: GUITTARD, Justice.

text:
    Dorothy HAYNIE, Appellant, v. GENERAL LEASING COMPANY, INC., Appellee.
    No. 18913.
    Court of Civil Appeals of Texas, Dallas.
    June 10, 1976.
    Alvin Boyd, Dallas, for appellant.
    Jay M. Vogelson, Steinburg, Luerssen & Vogelson, Dallas, for appellee.
   GUITTARD, Justice.

This suit is an attempt by the lessor of personal property to repossess the property by mandatory injunction on default in payment of the rent. The county court at law granted the injunction and the lessee appeals, contending that the court erred in granting a temporary mandatory injunction without allegations or proof of an irreparable injury, without a showing of lack of an adequate remedy at law, and without requiring a bond. We hold that the injunction was not proper.

The record reveals that the lessor failed to plead or to prove irreparable injury or lack of an adequate remedy at law. No authority supporting the issuance of mandatory injunctive relief in these circumstances has been cited. A temporary mandatory injunction changes the status quo and should be granted only in case of extreme hardship. Arvin Harrell Co. v. Southwestern Bell Telephone Co., 385 S.W.2d 696 (Tex.Civ.App.-Austin 1964, no writ); Bagley v. Higginbotham, 353 S.W.2d 868 (Tex.Civ.App.-Beaumont 1962, writ ref’d n. r. e.). Thus it is not a proper remedy in an action for possession of property without a showing of irreparable injury and lack of an adequate remedy at law. Neither is a temporary injunction valid without a bond, as required by Tex.R.Civ.P. 684. Lancaster v. Lancaster, 155 Tex. 528, 291 S.W.2d 303, 308 (1956); Young v. Gardner, 435 S.W.2d 192, 196 (Tex.Civ.App.-Houston [14th Dist.] 1968, no writ). Consequently, the trial court erred in granting the temporary mandatory injunction.

Lessor seeks to avoid application of these rules on the ground that the order appealed from is not a temporary injunction, but a permanent injunction granted after final determination of the right to possession. We do not so construe the trial court’s order. It was granted only twenty-three days after the suit was filed and at a hearing held pursuant to a “show cause” notice. It is styled “Temporary Injunction Pending Final Disposition of Cause,” and it orders the lessee to deliver the property to lessor “pending final disposition of this cause.” Although the order contains a recitation that the lessor is entitled to possession, that recitation cannot be considered a final determination of the parties’ rights. A decision made for the purpose of determining the propriety of temporary relief is not controlling at the final trial. See Texas Foundries, Inc. v. International Moulders & Foundry Workers’ Union, 151 Tex. 239, 248 S.W.2d 460, 464 (1952).

Lessor also suggests that the appeal is moot because the lessee has already complied with the order to deliver the property to the lessor. The lessee admits that she has delivered the property to lessor, but insists that the right to possession pending final trial is still in dispute. We hold that the appeal is not moot. A party’s compliance with a court order does not in itself deprive him of his right of appeal. Piper v. Hawley, 179 Cal. 10, 175 P. 417, 421 (1918); Workman v. Salzer Lumber Co., 51 N.D. 280, 199 N.W. 769, 770 (1924). This order recites that the lessor “is entitled to possession,” and orders the lessee to deliver possession to lessor “pending final disposition of this cause.” Thus it is more than a command to deliver the property. It determines which party shall be entitled to possession until trial on the merits. We have no occasion, however, to determine the right of possession, since we hold that the temporary mandatory injunction was improper for the reasons stated.

The order of the trial court is reversed and the mandatory injunction is dissolved.


author: DIES, Chief Justice.

text:
    William R. LAWLER, Jr., Appellant, v. FEDERAL DEPOSIT INSURANCE CORPORATION, as Receiver for Sharpstown Bank, Appellee.
    No. 7784.
    Court of Civil Appeals of Texas, Beaumont.
    June 10, 1976.
    Rehearing Denied July 8, 1976.

      Shelton E. Padgett, Houston, for appellant.
    Hugh Rice Kelly, Houston, for appellee.
   DIES, Chief Justice.

The Federal Deposit Insurance Corporation (F.D.I.C.), receiver of the Sharpstown State Bank, brought suit as plaintiff against William Lawler, Jr., on a promissory note. After a jury trial, judgment was given the F.D.I.C. from which Lawler perfects this appeal, basically asserting that material alterations were fraudulently made on the note, that he never received proceeds from the loan, and that the fraud perpetrated upon him was by an agent of the Sharpstown State Bank. We affirm the judgment of the lower court.

Lawler’s first point of error urges that the court should have granted him a judgment based on the jury’s answers to certain issues. These findings were: that the note was incomplete at the time it was signed; that it was completed in an unauthorized manner; and that the subsequent completion was materially different than when signed.

The question of alteration of a negotiable instrument is governed by § 3.407 of the Tex.Bus. & Comm.Code Ann. (1968), which provides in relevant part:

“(b) As against any person other than a subsequent holder in due course.
“(1) alteration by the holder which is both fraudulent and material discharges any party whose contract is thereby changed unless that party assents or is precluded from asserting the defense.” (Emphasis supplied.)

This section makes clear that both elements, fraudulent intent and materiality, must be established before discharge from the note is permitted.

The jury found in Special Issue No. 2a that the alterations were material, but failed to find in Special Issue No. 2b that there was an intention to defraud Lawler. There was no issue requested or submitted as to who altered the note. This fact is relevant because the comments to § 3.407 of the Tex.Bus. & Comm.Code Ann. (1968) state:

“3. Subsection (2) modifies the very rigorous rule of the original Section 124 [of the Uniform Negotiable Instruments Law]. The changes made are as follows:
“a. A material alteration does not discharge any party unless it is made by the holder. .
“b. A material alteration does not discharge any party unless it is made for a fraudulent purpose. . . .”

Subsection (b) is in conformance with the rule that the underlying debt of a note, even if the note itself was unenforceable, remains valid regardless of alterations unless the alterations were made with fraudulent intent. Republic National Bank of Dallas v. Strealy, 163 Tex. 36, 350 S.W.2d 914, 919-920 (1961); Otto v. Halff, 89 Tex. 384, 34 S.W. 910, 913 (1896); see also Keller v. Miller, 207 S.W.2d 684, 689-690 (Tex.Civ.App. — Fort Worth 1947, writ ref’d n. r. e.).

It was incumbent upon Lawler to secure a finding of fraud in order to escape the provisions of the note and comply with § 3.407 of the Tex.Bus. & Comm.Code Ann. (1968). This he failed to do, and the evidence supports the jury’s conclusion. Lawler’s Point of Error No. 1 is overruled. The trial court was correct in refusing him judgment on the defense of alteration.

Points of Error Nos. 2 and 3 contend that the evidence conclusively establishes that the changes were made with intent to defraud him and that the jury’s failure to so find is against the great weight and preponderance of the evidence. These points direct us to consider the entire record and determine whether there is some evidence to support the jury’s finding and whether that finding is not manifestly unjust. In re King’s Estate, 150 Tex. 662, 244 S.W.2d 660, 662 (1951).

In October of 1970, Lawler approached his banker for a line of credit to develop a mobile home park. He was directed to the City Bank and Trust Company in Dallas and, in discussions with its president, Joe P. Novotny, agreed to purchase 455 shares of the stock in this bank for $25,000. This sum was to be raised by promissory notes, one of which was to the Sharpstown State Bank in Houston in the amount of $12,740. Lawler testified that he knew he was signing a promissory note but did not realize that it was to the Sharpstown State Bank. He said that some of the blanks were not completed when he signed the note. The note has “SHARPS-TOWN STATE BANK, HOUSTON, TEXAS” conspicuously printed on the original document, and it is obvious that this portion of the note could not have been subject to any subsequent alterations. A cursory reading of the instrument by Lawler would have revealed this fact. There were no blanks to be completed in this regard. A party is charged with the obligation of reading what he signs. Indemnity Ins. Co. v. W. L. Macatee & Sons, 129 Tex. 166, 101 S.W.2d 553 (1937). And “[t]his rule is but a narrower application of the principle that the party claiming fraud has a duty to use reasonable diligence in protecting his own affairs.” Thigpen v. Locke, 363 S.W.2d 247, 251 (Tex.1962) see also Courseview, Incorporated v. Phillips Petroleum Co., 158 Tex. 397, 312 S.W.2d 197 (1957).

Lawler also testified that Novotny told him that the note would be payable in ten years, with interest due only the first five years with both interest and principal due the remaining five years. It is undisputed the note, principal, and interest are payable quarterly within the five year period. No-votny did not testify. Lawler understood that the note was to purchase City Bank and Trust stock with Novotny as trustee. Thus, he was not necessarily to receive cash for the $12,740 note. There is no proof that this transaction was not carried out.

On November 12, 1970, three days after execution of the Sharpstown note, Lawler received a “customer copy” with this letter:

“You have on the above date [November 9, 1970] executed a note payable to Sharpstown State Bank on demand. It is our understanding that you will pay five percent against the principal of the note plus interest each quarter.
“It is our intent that so long as these principal and interest payments are made, that this loan will be carried by us for the five year period necessary for its completed amortization.
Yours very truly,
/S/ Dallas A. Johnson”

At the time of this letter, Johnson was the chief executive officer of the Sharps-town State Bank. He also testified that prior to receiving Lawler’s note he had agreed with Novotny that the Sharpstown bank would assist Novotny and others, including Lawler, in the financing of the purchase of a majority of City Bank’s stock by a syndicate headed by Novotny. Johnson also stated that he only accepted notes that were completely filled in when they arrived at the bank and that this policy was understood by subordinates at the bank.

Lawler testified at one point that he would probably have bought the City Bank stock even if he had been refused the line of credit (which he was not) which led him to Novotny. The note in question bears five percent interest, which is considerably below the usual rate at that time.

John Patterson, a liquidator for the F.D. I.C., stated that the records reflect that the money was transferred from Sharpstown to City Bank for Lawler’s account.

Considering the record as a whole, we are unable to conclude that the jury’s failure to find an intention to defraud Lawler is against the great weight and preponderance of the evidence. The jury chose to believe Johnson and Patterson among others and to disregard the testimony of Lawler. The Points of Error Nos. 2 and 3 are without merit and overruled.

Points of Error Nos. 6, 7, and 8 assert that there is no evidence, or that it is against the great weight and preponderance of the evidence, to support the finding that Lawler received the $12,740.

Special Issue No. 3 inquired:

“Do you find from a preponderance of the evidence that William R. Lawler, Jr., did not receive $12,740 from Sharpstown State Bank in connection with the promissory note in question?”

The jury answered: “He did receive $12,-740.”

On February 15, 1971, Lawler wrote to the Sharpstown State Bank and attempted to rescind the note with the bank because of the “misrepresentations that have been made to me.” But Lawler also enclosed a check in that letter for $159.25 “for interest on my note dated November 9, 1970, in the amount of $12,740.00.” Thus, Lawler certainly understood at this time that he had a note with this particular bank and was making payments thereon. Further, there is no indication at all in the letter that Lawler ever asserted that he did not receive the proceeds, in some form, from the note. It is within the realm of reason to believe that he would not have made such payments had he not obtained such proceeds in some manner. As already noted in this opinion, Lawler realized that the proceeds from the note were to purchase stock in City Bank with Novotny as trustee. The relevant testimony shows:

“Q You are aware that Mr. Novotny was going to hold the stock for you as trustee?
“A Yes, he held it as a trustee.
“Q Now, if Mr. Novotny was going to hold the stock as trustee, what you mean to say is you didn’t expect to receive physical delivery of those stock certificates, did you?
⅝ ⅝ ⅜ ⅜5 ⅜ ⅜!
“A No, I did not.
“Q Do you know whether or not Mr. Novotny, as trustee for you, received the shares of stock for the $25,000?
“A No, I don’t. He never did notify me.
⅜ ¾: ⅜ £ ⅜ ⅝
“Q If you weren’t notified, does that mean it did not happen?
“A I don’t know.
“Q So, you can’t tell us one way or another whether or not the stock was issued to Mr. Novotny as trustee for you?
“A No, I can’t.”

There is evidence in the record to support the jury’s findings, and Points of Error Nos. 6, 7, and 8 are overruled as being without merit.

By Point of Error No. 10 appellant Lawler contends that the jury’s answer to Special Issue No. 4 that Novotny was not an agent of Sharpstown State Bank at the time and on the occasion in question was against the great weight and preponderance of the evidence.

As previously noted herein, Dallas A. Johnson was the chief executive officer of Sharpstown bank at the time the financing arrangement was made with Novotny. He testified that “Mr. Novotny came to me as the representative of a group of people who wanted to buy control in City Bank & Trust in Dallas. Mr. Novotny then represented at all times this group of people.”

“Q Did you look upon him as the bank representative?
“A No, sir, he was representing a group of investors.
“Q Was Joe Novotny authorized to make loans on his own?
“A No, sir.”

The burden was on Lawler to prove by a preponderance of the evidence that an agency relationship existed between Novotny and the Sharpstown State Bank. Buchoz v. Klein, 143 Tex. 284, 184 S.W.2d 271 (1944). There must be some act amounting to an appointment of a person as an agent and such a relationship can arise only at the will and by the act of the principal. Without the consensual relationship, no agency can exist. Green v. Hannon, 369 S.W.2d 853 (Tex.Civ.App.— Texarkana 1963, writ ref’d n. r. e.).

The evidence and testimony quoted above demonstrates that Sharpstown State Bank did not acquiesce in any such relationship with Novotny. The jury’s negative finding on this issue is supported by the record and relevant evidence. Point of Error No. 10 is overruled.

Appellant’s remaining points are likewise without merit and overruled.

The judgment of the trial court is affirmed.

AFFIRMED.

STEPHENSON, J., not participating.


author: McKAY, Justice.

text:
    CITY OF JACKSONVILLE, Appellant, v. ENTEX, INC., Appellee.
    No. 948.
    Court of Civil Appeals of Texas, Tyler.
    June 10, 1976.
    Rehearing Denied July 8, 1976.
    Emerson Stone, Jr., Jacksonville, for appellant.
    David Claflin, Entex, Inc., Houston, Gordon Thrall, Norman, Hassell, Spiers, Holland & Thrall, Jacksonville, for appellee.
   McKAY, Justice.

The City of Jacksonville, appellant, brings this appeal from an adverse summary judgment rendered in favor of Entex, Inc., appellee.

The City of Jacksonville is a home rule city. Entex is a gas utility operating under a franchise from the City. Entex requested a rate increase which was approved by the City by ordinance on October 8, 1974. The City had employed a Dr. Jack Hopper, a rate consultant, to assist in the investigation of and hearing on the requested rate increase. The fee for Dr. Hopper’s services was $4,865.00, which the City paid.

After the rate increase had been granted, the City made demand on Entex for reimbursement of Dr. Hopper’s fee. The City alleged that it had a right to reimbursement pursuant to Article X, Section 6(8) of its city charter. Entex offered to pay the fee on the condition that the amount be deducted from the 2% gross receipts tax which Entex owes the City. The City rejected this offer and filed suit for reimbursement.

During the trial, Entex filed a motion for summary judgment. Prior to the hearing on the motion, the parties stipulated to various matters among which were the following:

* * * * * *
“3. Entex makes the reports and occupation tax payments required by Section (1) of Art. 11.03 V.A.T.S. Gen.-Tax.
“4. Entex is current in its payment of the 2% gross receipts tax set forth in Section 7 of the franchise agreement approved September 29, 1969.
“5. * * * The amount Entex paid to the City of Jacksonville as gross receipts for the year 1974 tax exceeded $4,050.00. (Sic).”

The trial eourt granted Entex’s motion for summary judgment and the City brings this appeal.

The City’s only point of error alleges that the trial court erred in granting Entex’s motion for summary judgment because Article X, Section 6(8) of the city charter is controlling and created in the City the right to reimbursement for Dr. Hopper’s fee. In this connection, the City points to the established rule that home rule cities have full power of self-government and have authority to do anything the Legislature could theretofore have authorized them to do, the result being that home rule cities look to acts of the Legislature not for grants of power to such cities but only for limitations on their powers. City of Corpus Christi v. Continental Bus Systems, Inc., 445 S.W.2d 12 (Tex.Civ.App.-Austin 1969, writ ref’d n.r.e., 453 S.W.2d 470).

The provision of the charter on which the City relies provides:

“ARTICLE X. FRANCHISES AND PUBLIC UTILITIES
⅜ ⅝ ⅜ ⅜ £ ⅝:
“Section 6. Regulation of Franchise
“Every grant, renewal, extension or amendment of a public utility franchise, whether so provided in the ordinance or not, shall be subject to the right of the Council:
“(8) To require such franchise holders who request an increase in rates, charges or fares, to reimburse the City for reasonable expenses incurred in employing rate consultants to conduct investigations, present evidence and advise the Council on such requested increase.”

In considering appellant’s point, we shall also consider and discuss appellee’s counterpoints. Entex’s second counterpoint contends that the summary judgment was correct because Section 7 of Entex’s franchise from the City requires the City to credit any amount paid by Entex for charges “however designated” against the 2% of gross revenue Entex already pays the City. We disagree with this contention.

Section 7 of Entex’s franchise states:

“SECTION 7. In consideration for the rights and privileges herein granted, Grantee agrees to pay to Grantor for each quarter of a year during the term of this franchise a sum equal to two per cent (2%) of the gross receipts collected by Grantee during such quarter from the sale of gas delivered in Grantor. Each payment shall be made within thirty (30) days after the end of the quarter (March 31, June 30, September 30, or December 31) to which such payment is attributable. For fractional quarters of a year, said two per cent (2%) shall be based upon the gross receipts as defined above for that part of the quarter involved. Any special taxes, rentals or other charges, however designated, for the use by Grantee of Grantor’s streets, alleys and other public ways and places, accruing after the effective date of this franchise under the terms of any pre-existing or subsequently enacted ordinance (of either general application or application only to Grantee) shall, when paid to Grantor, be credited to the amount owed by Grantee under the terms of this franchise.” (Emphasis added.)

Section 7 merely requires that any charges, however designated, for the use of the City’s streets, alleys and other public ways and places, be credited towards the 2% of gross receipts paid annually by Entex to the City. Reimbursement of Dr. Hopper’s fee is not a charge for the use of the City’s streets, alleys and other public ways and places. Therefore, Section 7 does not require the City to credit the reimbursement fee against Entex’s annual payment of 2% of its gross receipts.

Entex’s first counterpoint argues that Tex. Tax.-Gen.Ann. art. 11.03 (1969), bars the City from collecting “a charge of any kind” in excess of the 2% of gross revenue Entex already pays to the City. Insofar as pertinent, Article 11.03 provides:

“Art. 11.03 Gas, Electric Light, Power or Water Works
* * ⅜ * * *
“(3) No city or other political subdivision of this State, by virtue of its taxing power, proprietary power, police power or otherwise, shall impose an occupation tax or charge of any sort upon any person, corporation, or association required to pay an occupation tax under this Article. Nothing in this Article shall be construed as affecting in any way the collection of ad valorem taxes authorized by law; nor impairing or altering in any way the provisions of any contracts, agreements, or franchises now in existence, or hereafter made between a city and a public utility, relating to payments of any sort to a city. Nothing in this Article shall be construed as prohibiting an incorporated city or town from making a reasonable charge, otherwise lawful, for the use of its streets, alleys, and public ways by a public utility in the conduct of its business, and each such city shall have such right and power; but any such charges, whether designated as rentals or otherwise, and whether measured by gross receipts, units of installation, or in any manner, shall not in the aggregate exceed the equivalent of two per cent (2%) of the gross receipts of such utility within such municipality derived from the sale of gas, electric energy, or water. * * * ” (Emphasis added.)

Article 11.03, Section 3, states as a general proposition that no city may impose an occupation tax or charge of any sort upon a corporation required to pay an occupation tax under this Article. Section 3, however, does go on to state three exceptions to this general proposition: (1) the collection of ad valorem taxes authorized by law; (2) payments to a city required under the provisions of any contracts, agreements, or franchises between a city and public utility; and (3) a reasonable charge for the use of a city’s streets, alleys, and public ways not to exceed 2% of the gross receipts of such utility derived from the sale of gas, electric energy, or water within such municipality.

As previously noted, Entex already pays the occupation tax to the State as required by Section 1 of Article 11.03. Therefore, Article 11.03 appears to bar the City from requiring Entex to reimburse Dr. Hopper’s fee unless the reimbursement charge comes under one of the three exceptions previously enumerated.

The reimbursement charge which the City seeks to impose is obviously neither an ad valorem tax nor a charge or rental for the use of the City’s streets, alleys and public ways. Therefore, to be valid, the charge must have been provided for in the franchise or some other contract between the City and Entex. The franchise, the only agreement between the parties in the record, is silent concerning reimbursement for the consultant’s fee. Entex did not agree or assent in the franchise to the reimbursement sought by the City. Consequently, the City’s demand for reimbursement fails to come under one of the exceptions set out in Article 11.03.

We are of the opinion that the City’s attempt to enforce Article X, Section 6(8) of the City’s charter violates Article 11.03. The charter provision in question provides that the franchise holder shall be subject to the right of the City to require reimbursement “whether so provided in the ordinance or not.” This provision of the City’s charter attempts to give the City the right to impose a charge in addition to the 2% gross receipts tax. Article 11.03 contemplates that charges in addition to the permissible 2% gross receipts tax (other than ad valo-rem taxes) shall be the subject of contracts negotiated by the parties and may not be imposed by the City in violation of Article 11.03. Article X, Section 6(8) of the City’s charter is void insofar as it conflicts with Article 11.03. Tex.Const. art. XI, section 5.

The City’s point of error is overruled. The judgment of the trial court is affirmed.


author: MOORE, Justice.

text:
    CITY OF JACKSONVILLE, Appellant, v. GENERAL TELEPHONE COMPANY OF THE SOUTHWEST, Appellee.
    No. 949.
    Court of Civil Appeals of Texas, Tyler.
    June 10, 1976.
    Rehearing Denied July 8, 1976.
    Emerson Stone, Jr., Jacksonville, for appellant.
    Wayne L. Goodrum, Preston, Holt, Good-rum & Harper, San Angelo, for appellee.
   MOORE, Justice.

Appellant, City of Jacksonville, instituted this suit against appellee, General Telephone Company, alleging that pursuant to the terms of its City Charter, the City was entitled to reimbursement in the sum of $4,050 for fees and expenses paid to a rate consultant employed by the City to assist in the investigation and hearing on appellee’s request for a rate increase. The telephone company answered with a general denial and specially denied the claim on the ground that the City contracted away its right to reimbursement for such fees and expenses by agreeing in the franchise to accept two percent (2%) of the telephone company’s gross annual receipts, in lieu of any tax, license, charge, fee or rental for the use and occupancy of the streets, in lieu of any pole tax, inspection fee, easement or franchise tax, and in lieu of any imposition other than the usual general or special ad valorem taxes. The cause came on for hearing before the trial court on the telephone company’s motion for summary judgment filed under the provisions of Rule 166-A, Texas, Rules of Civil Procedure. After a hearing, the trial court entered a summary judgment in favor of the telephone company from which the City perfected this appeal.

By a single point of error the City contends that the trial court erred in granting a summary judgment because Article X, Sec. 6, subparagraph 8 of the City Charter is controlling and created in the City a right of reimbursement for rate consultant fees and expenses as a matter of law. We are not in accord with the City’s contention and accordingly affirm the judgment rendered by the trial court.

The City of Jacksonville is a home rule city created under the provisions of Article 1165, et seq., Tex.Rev.Civ.Stat.Ann. (1925).

In 1954 a City Charter amendment was adopted which provided as follows:

“ARTICLE X. FRANCHISES AND PUBLIC UTILITIES
Section 6. Regulation of Franchise
“Every grant, renewal, extension or amendment of a public utility franchise, whether so provided in the ordinance or not, shall be subject to the right of the Council:
* * * * * *
8) To require such franchise holders who request an increase in rates, charges or fares, to reimburse the City for reasonable expenses incurred in employing rate consultants to conduct investigations, present evidence and advise the Council on such requested increase.”

On October 3, 1961, the City enacted Ordinance No. 110 in which it entered into a franchise agreement with General Telephone. In Section 7 of the franchise agreement General Telephone agreed to pay annually two percent (2%) of its annual gross receipts from local exchange telephone transmission service rendered within the City as consideration for the franchise. This consideration is additionally stated to be compensation for the City’s superintendence of the agreement which, in Section 11, includes the obligation of the City to fix rates which provide General Telephone with a fair return upon the fair value of its property.

Section 8 of Ordinance No. 110 granting the franchise to General Telephone contains the agreement of the City that the consideration to be paid by General Telephone would be paid and received in lieu of any tax, license, charge, fee or rental for the use and occupancy of the streets, in lieu of any pole tax, inspection fee, easement or franchise tax, and “in lieu of any imposition other than the usual general or special ad valorem taxes.” (Emphasis supplied.) The City further agreed in Section 8 that in the event the City did not have the power to agree that the consideration should be in lieu of such other charges, then it was agreed that the City would apply the consideration paid to the satisfaction of such other charges.

In October 1973, General Telephone made application to the City for authority to increase telephone rates within the city showing that the existing rates failed to provide a fair return as agreed. The City Council hired Dr. Jack Hopper to assist in evaluating the request. Subsequent to the resolution of the rate request and the institution of new rates, the City requested payment by General Telephone of Dr. Hopper’s fee in the amount of $4,050. Such payment was declined on the basis, inter alia, that the City had agreed to accept the two percent gross receipt payment prescribed by the franchise agreement in lieu of any other imposition such as Dr. Hopper’s charges.

Although Article X, Section 6 of the City Charter conferred a right on the City Council to require reimbursement even though the franchise ordinance did not so provide, we conclude that under the terms of the franchise the City elected to waive its right of reimbursement.

It is generally conceded that a franchise is the subject of a contract between the grantor and grantee and that it does in fact constitute a contract when, as here, the requisite element of consideration is present. It is binding mutually upon the grantor and grantee and is enforceable according to its terms and tenor. 36 Am. Jur.2d Franchises sec. 6, p. 728 (1968).

At the time the City Council granted the franchise in question, it was bound with notice of the City Charter provision granting the City a right of reimbursement. Nevertheless the Council agreed to accept two percent of the telephone company’s gross receipts as the total consideration for the franchise. The franchise stipulated that such consideration was in lieu of any other imposition other than ad valorem taxes.

It is now settled that a city may bind itself by a franchise so long as it does not surrender or contract away its police or governmental power. Texas Power & Light Company v. City of Garland, 431 S.W.2d 511, 517 (Tex.1968). The action of the City Council in electing to contract away its right of reimbursement does not amount to a surrender of its police or governmental power. Southwestern Bell Telephone Co. v. City of Port Arthur, 491 S.W.2d 187 (Tex.Civ.App. — Beaumont 1973, writ ref’d n. r. e.). We hold that when the City agreed in the franchise to accept a stipulated amount of the company’s gross receipts in lieu of any other imposition other than ad valorem taxes, the City elected to waive its charter provisions giving a right of reimbursement for consultant fees and expenses.

We are not in accord with the appellant’s contention that the City Council was without power to elect to waive the charter provision in question. The charter provision vests in the City Council discretion to determine whether a franchise holder will be required to reimburse the City. The charter contains no limitation upon the method by which the City Council elects to be reimbursed. Since the charter provision in question went no further than to grant the council a right to require reimbursement, the enforcement was not mandatory. It has been held that the City Council can waive compliance with a charter provision where the charter does not prohibit such a waiver. Cawthorn v. City of Houston, 231 S.W. 701, 704, 705 (Tex.Comm’n App.1921, holding approved); Liberty Mutual Insurance Company v. City of Fort Worth, 524 S.W.2d 743, 746 (Tex.Civ.App. — Fort Worth 1975, writ dism’d).

Even if it could be said that the City Council did not have the legal power to agree that specified gross receipts charges would be in lieu of all other impositions other than ad valorem taxes, we think the summary judgment proof demonstrates, as a matter of law, that the City had no cause of action for reimbursement because of other stipulations contained in Section 8 of the franchise.

The franchise agreement provides that General Telephone is to pay two percent (2%) of certain of its gross receipts as consideration for the franchise grant and as compensation for the City’s supervision of the agreement which obligates the City to regulate and fix the rates of the company. Section 8 of Ordinance No. 110 contains the agreement of the City that the consideration would be paid and received in lieu of any tax, license, charge, fee or rental for the use and occupancy of city streets, in lieu of any pole tax, inspection fee, easement or franchise tax and in lieu of any imposition other than the usual general or special ad valorem taxes. In the last sentence of Section 8 the City further agreed that should it not have the power to agree that the consideration should be in lieu of such other charges, then it would apply the consideration paid to the satisfaction of such other charges.

The record reveals that all payments required under the franchise agreement have been made and that each and every payment exceeds the $4,050 claimed by the City for consultant fees. Thus, in accordance with the agreement the City was obligated to apply the gross receipts to the payment of the consultant’s fee. Consequently, no duty rested on the telephone company to pay the consultant’s fees and expenses.

While the telephone company maintains that the summary judgment may also be sustained on the ground that the Charter provision is void because it is in conflict with Article 11.06, Tex.Rev.Civ.Stat.Ann., Tax.-Gen., we do not find it necessary to decide the case on that basis. Irrespective of the validity of the Charter provision, the summary judgment proof conclusively establishes that no liability on the part of appellee existed and therefore appellee is entitled to a summary judgment as a matter of law. Swilley v. Hughes, 488 S.W.2d 64 (Tex.1972).

The judgment of the trial court is affirmed.

      . “SECTION 8. PAYMENT OF CASH CONSIDERATION TO BE IN LIEU OF ANY OTHER PAYMENTS EXCEPT USUAL GENERAL OR SPECIAL AD VALOREM TAXES.
      “The City agrees that the consideration set forth in the preceding section hereof shall be paid and received in lieu of any tax, license, charge, fee, street or alley rental or any other character of charge for use and occupancy of the streets, alleys, and public places of the City; in lieu of any pole tax or inspection fee tax; in lieu of any easement or franchise tax, whether levied as an ad valorem, special or other character of tax; and in lieu of any imposition other than the usual general or special ad valorem taxes now or hereafter levied. Should the City not have the legal power to agree that the payment of the foregoing cash consideration shall be in lieu of the taxes, license, charges, fees, rentals, and easement or franchise taxes aforesaid, then the City agrees that it will apply so much of said payment as may be necessary to the satisfaction of the Telephone Company’s obligations, if any, to pay any such taxes, licenses, charges, fees, rentals, and easement or franchise taxes.”

      . Article 11.06 subsection (1) imposes upon telephone companies operating within the State of Texas an occupation tax based upon gross receipts. Subsection (2) of the Article provides that no city shall impose an occupation tax, or charge of any sort for the privilege of doing business, upon anyone required to pay an occupation tax under Article 11.06.


author: CIRE, Justice.

text:
    Paul M. LUTES, Appellant, v. Lucy M. LUTES, Appellee.
    No. 1384.
    Court of Civil Appeals of Texas, Houston (14th Dist.).
    June 16, 1976.
    See also, Tex.Civ.App., 536 S.W.2d 418.

      E. W. Newman, Houston, for appellant.
    W. D. Masterson, Kilgore & Kilgore, Dallas, for appellee.
   CIRE, Justice.

This is an appeal from an order granting a plea of privilege in a divorce case. Appellant Paul Lutes brought suit for divorce in the Harris County Court of Domestic Relations. Appellee Lucy Lutes filed her plea of privilege to be sued in Henderson County, the county of her residence. Appellant filed his verified controverting plea.

Appellant’s original petition stated that he had been a domiciliary of Texas for the preceding six months and a resident of Harris County for the preceding 90 days. Ap-pellee’s plea of privilege alleged that she resides in Henderson County and there exists no exception to her right to be sued in the county of her residence. Appellant controverted the plea of privilege on the basis that by virtue of his having been a domiciliary of Texas for six months and a resident of Harris County for 90 days, venue was proper in Harris County. At the hearing on the plea of privilege appellant made an oral motion to dismiss the plea. On the basis of these pleadings the trial court granted ap-pellee’s plea of privilege.

Appellant contends in his first point of error that the trial court erred in overruling his motion to dismiss the plea of privilege because, by virtue of section 3.21 of the Texas Family Code, the general venue statute, Tex.Rev.Civ.Stat.Ann. art. 1995, does not apply in divorce actions. Section 3.21 of the Family Code reads:

No suit for divorce may be maintained unless at the time suit is filed the petitioner or the respondent has been a domiciliary of this state for the preceding six-month period and a resident of the county in which the suit is filed for the preceding ninety-day period.

Article 1995, subdivision 16 reads:

Suits for divorce shall be brought in the county in which the plaintiff shall have resided for six months next preceding the bringing of the suit.

As authority for his contention that the general venue statute does not apply in divorce cases, appellant cites McKinney v. McKinney, 274 S.W.2d 908 (Tex.Civ.App.— Amarillo 1954, no writ) and Randell v. Randell, 222 S.W.2d 252 (Tex.Civ.App. — Fort Worth 1949, writ dism’d). Those cases construed Article 1995 together with former Article 4631 (Tex.Laws 1957, Ch. 155, § 1, at 341), the predecessor of section 3.21 of the Family Code. Article 4631 provided that no suit for divorce could be maintained unless the petitioner had been a bona fide inhabitant of Texas for twelve months and a resident of the county in which the suit was filed for the preceding six months. In the Randell and McKinney cases the courts held that Article 4631 was more than a mere venue statute: it prescribed the mandatory “qualifications of residence that a plaintiff must have to prosecute an action for divorce.” McKinney, 274 S.W.2d at 909; Randell, 222 S.W.2d at 253. For this reason the courts held in the McKinney and Randell cases that a plea of privilege was not the proper vehicle through which to challenge a plaintiff’s residency qualifications. Such a challenge should be brought through a plea in abatement, and the proper remedy, if the plaintiff were found not to have satisfied the residence qualifications, would be dismissal rather than transfer of the proceedings to another county.

Although section 3.21 of the Family Code is not identical to article 4631, its purpose is the same. Section 3.21 establishes the residence qualifications without which no suit for divorce may be prosecuted. The pronouncements in the McKinney and Randell cases that a challenge to the petitioner’s residence qualifications must be brought by a plea in abatement are still applicable under the new provision of the Family Code.

Further, in Randell and McKinney the courts of civil appeals held that to sustain a plea of privilege and transfer a divorce case to the county of the defendant’s residence would be a futile thing. This holding was based on the terms of Article 4631, under which “[i]n a divorce case, the residence of the defendant is of no importance in determining where the suit is to be filed.” Randell, 222 S.W.2d at 253. The residence requirements of section 3.21 are satisfied if either the petitioner or respondent has been a domiciliary of Texas for the preceding six months and a resident of the county in which the suit is filed for the preceding 90 days. Thus the petitioner may now bring suit in either the county of his residence or in that of the respondent’s. But the choice of in which of those counties the suit is to be filed is still given to the petitioner. By a proper plea in abatement the respondent may challenge the petitioner’s satisfaction of the 90-day residence requirement, or may challenge the petitioner’s allegation that the respondent has resided for 90 days in the county of suit. The right of a petitioner in a divorce case to bring suit in the county in which he or the respondent has resided for the preceding 90 days is specifically granted by section 3.21 of the Family Code. As a specific statute, section 3.21 controls over Article 1995, the general venue statute. See also Tex.Rev. Civ.Stat.Ann. art. 1995, sec. 30. Appellant is therefore correct in his assertion that a plea of privilege was inappropriate in this proceeding and should have been dismissed.

Appellee asserts by counterpoint that we should consider her plea of privilege as a plea in abatement and render judgment here dismissing appellant’s suit. Appellee’s plea of privilege contained the allegation that she had filed suit for divorce in Henderson County prior to the date appellant filed his suit in Harris County. It is true that Texas follows the rule that the court in which suit is first filed acquires dominant jurisdiction to the exclusion of other coordinate courts. Cleveland v. Ward, 116 Tex. 1, 285 S.W. 1063 (1926). The second court must dismiss the suit filed there if the pendency of a prior identical suit is called to its attention by a proper plea in abatement. Curtis v. Gibbs, 511 S.W.2d 263, 267 (Tex.Sup.1974); Cleveland v. Ward, 285 S.W. at 1069, 1072. Appellee therefore urges this court to consider her plea of privilege as a plea in abatement calling the court’s attention to a prior suit pending in Henderson County and to render judgment dismissing the Harris County suit.

We are unable to do this. The rule stated in Cleveland v. Ward is not without exceptions. The conduct of the plaintiff in the first suit may be such as will estop him from relying on that suit to procure abatement of the second suit. Curtis v. Gibbs, 511 S.W.2d at 267; Reed v. Reed, 158 Tex. 298, 311 S.W.2d 628 (1958). After a hearing on appellee’s plea, the trial court might have found that a prior suit had been “commenced” (as that term is used in the Reed case) in the district court of Henderson County, and thereby dismissed the Harris County suit.

There was no hearing, however. The record reflects that when the parties and their counsel appeared for the hearing on appellee’s plea of privilege, the court conducted an informal conversation with the attorneys for both parties and with appellee concerning various matters of law and fact. At the end of this conference, without hearing any testimony or receiving any other evidence, the court sustained ap-pellee’s plea of privilege. After the plea was sustained, appellant was allowed to present his bill of exceptions. Appellee’s pleadings do not show as a matter of law that she is entitled to dismissal of the Harris County suit. We are therefore unable to render such a judgment here.

The judgment of the trial court sustaining appellee’s plea of privilege is reversed, and judgment is here rendered dismissing the plea of privilege.

Reversed and rendered.


author: O’QUINN, Justice.

text:
    STATISTICAL TABULATING CORPORATION, Appellant, v. Bob BULLOCK, Comptroller of Public Accounts, Appellee.
    No. 12416.
    Court of Civil Appeals of Texas, Austin.
    June 16, 1976.
    Rehearing Denied July 7, 1976.

      Donald F. Nobles, Austin, for appellant.
    John L. Hill, Atty. Gen. of Texas, Gilbert J. Bernal, Jr., Asst. Atty. Gen., Austin, for appellee.
   O’QUINN, Justice.

Statistical Tabulating Corporation brought this suit in June of 1974 to recover in excess of $20,000 in taxes resulting from a deficiency determination by the Comptroller of Public Accounts.

After trial before the district court without a jury, the court entered judgment that Statistical Tabulating take nothing by its suit. We will reverse the judgment of the trial court and render judgment that Statistical Tabulating Corporation recover its taxes paid to the State.

The essential facts in this ease are that appellant is engaged in a business in the course of which customers bring data related to the customer’s business which appellant translates, by means of “key punch machines,” into a form, on cards supplied by appellant, adapted to further clarification by computers so that the customer may singly, or repetitively, print out the information for ultimate use. The only materials furnished by Statistical Tabulating are the cards punched to reflect the data supplied by the customer. A sales tax is paid by Statistical Tabulating on the card forms used in this process.

The Comptroller takes the position that a “sales tax” is due on the entire process, and denies that the punching of the cards, from data supplied by the customer, is a “service rendered” within the terms of the “Sales, Excise and Use Tax” (Articles 20.01 et seq., V.A.T.S., Taxation-General, ch. 20, Vol. 20A).

The statute does not levy a tax on services. To impose the tax under the facts of this case it is necessary to say that the transactions under examination fall within the definition of a “sale” as found in the statute. Article 20.01(E)(2)(a) defines “sale” as, “The producing, fabrication, processing, printing or imprinting of tangible personal property for a consideration for consumers who furnish, either directly or indirectly, the materials used in the producing, fabricating, processing, printing, or imprinting.” (Emphasis added)

The parties come to issue on the word “processing,” as used in the statute, and the State insists that the process, coupled with the cards used and furnished by Statistical Tabulating, amounts to a sale, as opposed to the furnishing of a service, which is not taxable. The so-called materials “used in” the processing are furnished directly by the customer in the form of data.

Under the facts of this case the customer does not furnish materials in the nature of tangible things. The “materials” furnished are data, information, statistics, which are intangible products of accounting, research, or records. The basic definition of material is “pertaining to, or consisting of, matter; corporeal; physical; not spiritual . .” (Webster: International Dictionary of the English Language, 2nd Ed., unabridged). The word material stems directly from Latin materia: “stuff, matter, materials of which any thing is composed; so the wood of a tree; timber for building . . .” (Lewis & Short: A Latin Dictionary, Oxford University Press, 1975). We are aware of a secondary, evolved and derivative meaning, which includes “data such as notes, documents, sketches, etc., which may be worked up into a more finished form; as materials for a biography .” (Emphasis added) (Webster, supra ). There is no working up “into a more finished form” under the facts of this case, only a mechanical transference of data, requiring no alteration of interpretation, to machine cards suitable for use in computers.

The tax statute under examination undertakes to levy a tax upon the sale of “tangible personal property” only (Art. 20.-01(E)(2)(a), (b), (d), (e)), and “furnishing, preparing or serving for a consideration of food, meals, or drinks.” (Art. 20.-01(E)(2)(c)). It is noted that the only variance from a tax upon sale of “tangible personal property” is to tax the furnishing, servicing, and sale of tangible “food, meals, or drinks.” It may not be assumed or implied that the Legislature intended also to tax intangible data as materials furnished by a customer wanting the data transferred to cards suitable for computer calculations or recording. The Legislature made it clear that the tax should fall only on “tangible personal property.” In Article 20.01(W) “ ‘Taxable Items’ means tangible personal property,” and Article 20.01(P) defines the term: “ ‘Tangible Personal Property’ means personal property which may be seen, weighed, measured, felt or touched, or which is in any other manner perceptible to the senses.”

It is settled that in construing a tax statute, where the question is whether the person or entity sought to be taxed comes within the statutory provision imposing the tax, “. . . the statute must be construed strictly against the taxing authority and liberally in favor of the person [or entity] sought to be held.” Texas Unemployment Compensation Commission v. Bass, 137 Tex. 1, 151 S.W.2d 567, 570 (1941); State v. Praetorians, 143 Tex. 565, 186 S.W.2d 973, 976 (Tex.Comm’n App.1945, opinion adopted); State v. Kenyon, 153 S.W.2d 195, 199 (Tex.Civ.App. Austin 1941, writ ref.); Wilson Communications, Inc. v. Calvert, 450 S.W.2d 842, 844 (Tex.1970).

In applying the rule of these cases, if there is doubt under terms of the statute that Statistical Tabulating should come within the sales tax with its type of operation demonstrated by the record, the doubt must be resolved against the Comptroller and in favor of the taxpayer appellant.

We conclude that the statute so plainly levels the tax upon things corporeal, “tangible personal property,” as to require the construction that the Legislature did not intend to tax the processing operations performed by Statistical Tabulating, and we so hold. We find this conclusion reasonably supported in principle by earlier decisions of this Court involving the rendition of services as opposed to sale of tangible personal property. Calvert v. Julian Gold, Inc., 479 S.W.2d 328 (Tex.Civ.App. Austin 1972, writ ref. n.r.e.); Williams & Lee Scouting Service, Inc. v. Calvert, 452 S.W.2d 789 (Tex.Civ.App. Austin 1970, writ ref.).

The precise question presented under the facts of this case we do not find considered or passed on in other decisions by courts in this state. We have examined numerous authorities in other jurisdictions, and have found the reasoning and conclusions of certain of these cases, in which the facts are similar, support the conclusions we have reached.

In A. B. C. Electrotype Co. v. Ames, 364 Ill. 360, 4 N.E.2d 476 (1936), the unit sought to be taxed made electrotype, stereotypes, and matrices for customers who furnished the type or patterns to be transformed to the matrices or types. The court reasoned that the small quantity of tangible material used in the operation was destroyed, or had no further value, after the processing, except to the customer who ordered the reproduction. “What the customer really pays for is the skill, labor, and use of the machinery and equipment of the electrotyper.” The court concluded that the electrotyper was engaged in furnishing skill, labor and use of machinery and “not in the sale of tangible personal property.”

Similarly, in Washington Printing and Binding Co. v. State, 192 Wash. 448, 73 P.2d 1326 (1937), the court reasoned that the printer of tariffs, compiled by the railroad customer, furnished only paper, ink, skill, and machinery, but did not sell the paper and ink within the tax statute, but instead performed a service.

Other such cases include H. G. Adair Printing Co. v. Ames, 364 Ill. 342, 4 N.E.2d 481 (1936); J. A. Burgess Co. v. Ames, 359 Ill. 427, 194 N.E. 565 (1935); State of Alabama v. Natco Corp., 265 Ala. 184, 90 So.2d 385 (1956); Central Lith. & Eng. Co. v. Moore, 75 Wis. 170, 43 N.W. 1124 (1889), in each of which it was held that services had been sold and not tangible goods.

Although there are decisions in cases from other jurisdictions not in accord with the views we have expressed, we consider them distinguishable either because of differences in the tax statutes or on the facts, and regard them as not persuasive.

For the reasons stated in this opinion, we reverse the judgment of the trial court and render judgment that appellant recover the taxes paid with interest as provided by law.

Reversed and Rendered.

      . Comptroller: pronounced kontroler, originally an erroneous spelling of controller, after F. compte, account; defined as public officer whose duty is to supervise accounts and determine propriety of expenditures: a controller. See Webster: New International Dictionary of the English Language, 2nd Ed., unabridged.


author: BARROW, Chief Justice.

text:
    Mary Wilkins MEREDITH, Appellant, v. DUVAL COUNTY RANCH COMPANY, Appellee.
    No. 15520.
    Court of Civil Appeals of Texas, San Antonio.
    June 16, 1976.

      Baker & Botts, Ralph S. Carrigan, E. R. Fleuriet, Fred W. Fulton, Houston, for appellant.
    Stiernberg, Skaggs & Koppel, Jerry L. Stapleton, Harlingen, for appellee.
   BARROW, Chief Justice.

Appellant has perfected her appeal from a take-nothing summary judgment rendered in her suit to recover as a third party beneficiary of an employment contract entered into between her husband, Otis Meredith, and appellee. Appellant urges as her single point of error that the trial court erred in granting appellee’s motion for summary judgment and in not granting appellant’s motion for summary judgment.

On March 26, 1973, the Board of Directors of appellee, hereinafter sometimes referred to as Duval, by resolution authorized its president, W. H. McDugald, to execute the contract in question with Meredith, who had served consecutively as President and Chairman of the Board of Directors of Duval for more than 30 years. The question before us is whether said contract is valid and enforceable.

The contract provides in part:

1. Duval agrees that Otis Meredith shall continue to be employed as Chairman of the Board of Directors at his present salary of $16,000.00 per annum until further action of the Board of Directors of Duval. Duval further agrees that whenever salary payments to Otis Meredith are reduced to less than $12,000.00 per annum or said salary is discontinued that Duval will, beginning on the first day of each month after such reduction or termination of salary, pay to Mary Wilkins Meredith, wife of Otis Meredith, the sum of $500.00 monthly and continue to so pay $500.00 on the first day of each month thereafter as long as said Mary Wilkins Meredith may live. The reduction of the salary of Otis Meredith to below $12,000.00 per an-num, or its discontinuance, may result from action of the Board of Directors or stockholders of the company or from his death or disability, or for some other reason or cause, and it is understood that no matter what the cause of the reduction may be, or if no salary be paid, that Duval agrees to pay to Mary Wilkins Meredith, wife of Otis Meredith, be she then surviving at the time of the reduction or termination, the sum of $500.00 monthly in accordance with this agreement. [It further provides for termination upon death of Mary Wilkins Meredith and that the monthly payments are not assignable.]

2. Otis Meredith agrees as follows:

(a) To continue acting as Chairman of the Board of Directors of Duval as long as may be desired by Duval, subject to his physical abilities to perform such duties.
(b) To hold himself in readiness to consult and advise with the officers and Directors of Duval upon matters pertaining to company affairs at any and all times and places mutually convenient;
(c) To attend all Directors’ meetings when compatible with his other duties and activities;
(d) To cooperate with and aid the officers and employees of Duval upon request, with his knowledge and information of the records, files and business of the company and upon the political and private matters pertaining to Duval and Webb Counties, as they may affect the wellbeing of Duval.

This contract was executed by Duval and Meredith following its approval by the Board of Directors of Duval at its annual meeting held March 26, 1963.

On September 26, 1963, the Board of Directors approved a proposal by Meredith that his salary be reduced to the sum of $6,000.00 annually effective September 1, 1963. The Board further adopted a resolution to commence paying Mary Wilkins Meredith the sum of $500.00 monthly in accordance with the terms of the employment contract with Meredith dated March 26, 1963. These monthly payments of $500.00 less withholding tax were regularly made to appellant through December 1, 1971. No payments were made after December 1, 1971. In October 1971, a change of ownership occurred with regard to the stock of Duval, and on November 1, 1971, Meredith resigned his position as director of the company.

It was stipulated that Meredith then ceased all involvement with Duval, and has not been in or near the ranch upon the business of Duval or on its behalf, and is not familiar with, or active in, the management of affairs of Duval. There is no contention that Meredith has ever been requested to consult with or advise the new Board of Directors or new officers since his resignation as a director.

The summary judgment does not contain the basis for denying the claim of appellant; however, Duval seeks to uphold the take-nothing judgment for several reasons. 1. The contract was merely an agreement to provide for the continuance of Meredith as a permanent director in violation of the by-laws of Duval which provided that the term of office of directors should not be longer than one year. 2. The agreement is void or voidable and unenforceable because it violates public policy by creating a lifetime employment contract. 3. The contract is void or voidable and unenforceable because it lacks mutuality of obligation.

Duval contends that the contract is merely an agreement to provide for the continuation of Meredith as a permanent director at a guaranteed lifetime salary, and is therefore in violation of the rule set forth in Pioneer Specialties, Inc. v. Nelson, 161 Tex. 244, 339 S.W.2d 199 (1960). The Supreme Court, in Nelson, held that the corporate by-laws, which provided for the election of a president for one year, by necessary implication, prohibited Nelson’s employment as president for a term of two years. It was recognized, however, that since the adoption of Art. 1327, Tex.Rev. Civ.Stat.Ann., in 1951, followed by the adoption of the Texas Business Corporation Act in 1955, a corporation is authorized under the law to enter into a contract extending beyond one year unless prohibited by its by-laws. Nelson was employed to be president for a period of two years although the by-laws of Pioneer Specialties, Inc. provided that the president and other corporate officers should be elected for one year. He was discharged by the Board after a few months and sought to recover damages for the balance of his two-year contract. It was held that such employment was prohibited and Nelson was denied recovery for damages sustained after one year. The dissenting opinion makes it clear that the result would have been different if Nelson had been employed to perform any duties other than to serve as president.

The by-laws of Duval provide that directors shall hold office for one year. However, the contract in question does not purport to employ or retain Meredith as Chairman of the Board of Directors for more than one year. To the contrary, he is expressly employed “until further action of the Board of Directors of Duval.” The contract also recognizes the right of the Board of Directors or the stockholders to reduce the salary below $12,000.00 or even to discontinue it. The contract requires Meredith to perform duties and services other than as Chairman of the Board of Directors. Three other duties are specifically required of Meredith by paragraph two of the contract. Under these covenants, Duval secured the continued advice and counsel of Meredith for as long as his health permits. We conclude that the contract for consultation services is not within the prohibition set forth in Pioneer Specialties, Inc. v. Nelson, supra.

Duval contends that, in any event, such a long-term employment contract is against public policy and should not be enforced. A similar contention was made and rejected by the court in Miller v. A. & N. R. Railroad Co., 476 S.W.2d 389 (Tex.Civ.App. —Beaumont 1972, no writ). We adopt the holding of that case.

It was stipulated that Meredith was a minority stockholder in Duval at the time of the execution of the contract in question, and there is no contention that the contract was the result of any fraudulent action or overreaching on the part of Meredith or the Board of Directors of Duval. The reduced compensation went into effect shortly after the contract was executed, and Duval secured the benefits of the continued advice, counsel, and knowledge of Meredith for several years prior to the change in ownership of the Duval stock. It would still be available if desired by the new management of Duval.

Since 1951, long-term employment contracts have been permitted under Texas law provided that they do not conflict with the by-laws of the corporation. There is no prohibition in the by-laws of Duval against such an employment contract. The fact that the consideration to be paid by Duval was to extend over a period of time rather than in a lump sum, or some other arrangement, was a matter for the contracting parties to decide. The disparity in exchanged considerations, if any, is not so unconscionable as to merit equitable relief. It cannot be said that this long-term employment and consultation agreement offends the public policy of this State.

Finally, it is urged by Duval that the contract in question is void or voidable and unenforceable because it lacks mutuality of obligation. Such contention is based on Du-val’s assumption that Meredith was required to do nothing other than serve as Chairman of the Board of Directors. We have heretofore pointed out that Meredith promised to furnish advice, counsel, and knowledge to the directors and officers for as long as his health permitted. In return, Duval promised to pay the sum of $500.00 per month to the wife of Meredith during her lifetime. These promises constituted mutuality of obligation.

The trial court erred in holding that the contract was unenforceable and entering the take-nothing judgment. There is no contention on this appeal that appellant is not entitled to recover on said contract as a third party beneficiary, although the parties have reserved the amount of her recovery for trial on the merits. We conclude that appellant’s motion for summary judgment was erroneously overruled insofar as she sought a declaration that the contract was valid and enforceable.

The judgment of the trial court is reversed and here rendered for appellant to declare that the contract in question is valid and enforceable. The cause is remanded to the trial court for determination of the amount of damages to be recovered by appellant.


author: PER CURIAM.

text:
    C. Hunter McSHAN, Appellant, v. Anthony PITTS, Appellee.
    No. A 3754.
    Court of Civil Appeals of Texas, San Antonio.
    June 16, 1976.
    William H. Ervine, Jr., Kerrville, for appellant.
    H. Charles Strauss, Jr., Kerrville, for ap-pellee.
   PER CURIAM.

Appellee filed his motion for leave to file a supplemental transcript consisting of the findings of fact and conclusions of law filed on April 27, 1976 in the above cause. This motion was opposed by appellant for the reason that the findings of fact and conclusions of law, although requested by appellant, were not timely made so as to afford appellant the opportunity to object and request additional findings. See Rules 297 and 298, Tex.R.Civ.P. The transcript was filed in this Court on April 19, 1976.

An examination of the record demonstrates that appellant timely requested the trial court to file findings of fact and conclusions of law and properly called to the attention of the trial judge his failure to file same. The rule in this State has been that the failure of the trial court to file findings of fact and conclusions of law when properly requested constitutes reversible error, unless the record before the appellate court affirmatively reflects that the complaining party has suffered no injury. Wagner v. Riske, 142 Tex. 337, 178 S.W.2d 117 (1944). Here the findings of fact and conclusions of law were made, but not in time for appellant to have any opportunity to request additional findings.

We conclude that instead of reversing the judgment, the proper order is one directing the trial court to file its findings of fact and conclusions of law so as to give appellant the opportunity to request further, additional, or amended findings in accordance with Rule 298, Tex.R.Civ.P. The trial court is directed to file his original findings of fact and conclusions of law no later than July 1,1976. Appellant will then have five days to request further, additional, or amended findings. After final action on such findings of fact and conclusions of law, same shall be filed in our Court by supplemental transcript. The time for filing appellant’s brief shall begin to run at the time such supplemental transcript is filed.


author: AKIN, Justice.

text:
    The COMMISSIONERS COURT OF DALLAS COUNTY, Texas, Appellant, v. Robert R. COLE, Justice of the Peace, Precinct One, Place One, Dallas County, Texas, Appellee.
    No. 18952.
    Court of Civil Appeals of Texas, Dallas.
    June 17, 1976.
    Henry Wade, Dist. Atty., Stephen P. To-koly, Asst. Dist. Atty., Dallas, for appellant.
    Gerald Weatherly, Dallas, for appellee.
   AKIN, Justice.

This is an appeal from a temporary injunction granted plaintiff Cole enjoining the commissioners court from abolishing and refusing to fund the position of one of plaintiff’s clerks. Robert R. Cole, justice of the peace, precinct one, place one of Dallas County, sued the commissioners court of Dallas County to enjoin the commissioners court from reducing the size of his staff from ten to nine, contending that the commissioners court abused its discretion in ordering the reduction. The commissioners court asserted that its action in reducing Judge Cole’s staff was a proper exercise of its constitutional and statutory power over county business. Since the commissioners are not adversely affected by the injunction granted, we dismiss their appeal.

The controversy arose on January 1,1976, when the boundaries of the justice of the peace precincts were revised. After the redistricting, the commissioners court found that, due to the substantial decrease in both area and in population of precinct one, Judge Cole would need only nine clerks in order to operate effectively. Judge Cole disagreed and filed this action. At the hearing, there was evidence that two members of Judge Cole’s staff had submitted their resignations, to be effective February 29, 1976. The court granted a temporary injunction from which order the commissioners have perfected their appeal.

The order granting the temporary injunction states:

Defendants . . . are hereby temporarily enjoined and restrained from abolishing the position of one of the staff members of the staff of plaintiff as justice of the peace, and for removal of one of said staff members, and from refusing to finance continuance of such staff member’s position as continuance of same is hereby ordered.
But, it appearing to this court that two of plaintiff’s said staff members are imminently about to resign from plaintiff’s said staff, it is further ordered by this court that one of these positions will not be filled after 29 February 1976.

This order was signed on February 26, 1976. The first paragraph of the order restrains the commissioners from abolishing the position, from removing one staff member, and from refusing to finance the position. These restraints are qualified, however, by the second paragraph. That paragraph prohibits the commissioners from filling the position after February 29, when, according to the evidence, vacancies would occur. When the two paragraphs of the order are read together, it permits Judge Cole to work with a ten-person staff between February 26 and February 29, but thereafter the commissioners court may require him to work with a staff of nine. Consequently, the commissioners are not in fact ordered to finance continuance of the tenth staff member’s position pending final trial.

We conclude, therefore, that only Judge Cole was adversely affected by this order after February 29, 1976. He has not appealed, and neither has he filed cross-points. The right of appeal rests only in an aggrieved party to a lawsuit. Tex.Rev.Civ. Stat.Ann. art. 2249 (Vernon 1971); McFarling v. Lapham, 489 S.W.2d 435, 440 (Tex.Civ.App. — Beaumont 1972, writ ref’d n.r.e.); Texas Employers Insurance Ass’n v. Howell, 107 S.W.2d 391, 392 (Tex.Civ.App.— Dallas 1937, writ dism’d). Since we have concluded that the commissioners are not now aggrieved by the order, it necessarily follows that the appeal prosecuted by them should be dismissed. This is because one may not complain of a judgment that does not adversely affect him. E. g., Shell Petroleum Corp. v. Grays, 131 Tex. 515, 114 S.W.2d 869, 870 (1938).

Appeal dismissed.


author: KEITH, Justice.

text:
    Rollin D. SMITH et al., Appellants, v. PANORAMA COUNTRY CLUB, Appellee.
    No. 7800.
    Court of Civil Appeals of Texas, Beaumont.
    June 17, 1976.
    Rehearing Denied July 8, 1976.

      Robert 0. Campbell, Houston, for appellants.
    Fletcher Etheridge, Houston, W. C. McClain, Conroe, for appellee.
   KEITH, Justice.

Plaintiffs below sought a declaratory judgment; but, after a bench trial, judgment was rendered against them and they have perfected the appeal. There are few, if any, disputed facts. The trial court filed extensive findings of fact and conclusions of law and our resume of the facts will be taken therefrom without benefit of attribution.

The defendant, Panorama Country Club (hereinafter “Club”), was organized under the Texas Non-Profit Corporation Act, Art. 1396, Tex.Rev.Civ.Stat.Ann. (1962) (hereinafter “Act”), and operates a golf and country club. Its members are shareholders; and, after the Club’s incorporation in 1969, there were 353 shareholding members, four of whom are the plaintiffs herein. The members of the Club owned homes located at strategic places near and adjacent to the 27-hole golf course owned by the Club.

In order to finance the purchase of the golf course and other improvements, the Club issued and sold $350,000 in its first mortgage bonds due and payable in ten years after issuance and bearing interest at the rate of eight percent per annum payable quarterly. When the club house was damaged by fire, an additional $81,500 in second mortgage bonds were issued and sold. Each series of bonds was secured by a first (or second, as the case may be) mortgage lien upon the Club’s facilities subject to foreclosure in the event of default.

The Club experienced financial problems almost from the start and had difficulty in making the interest payments due upon the bonds, some of which were owned by the plaintiffs herein. The Club membership, acting pursuant to its by-laws, voted to issue preferred stock for the purpose of redeeming the outstanding mortgage bonds. Pursuant to this action of the directors and shareholders, the Club issued and sold $421,-000 of the preferred stock and applied the funds so received to the redemption of the first and second mortgage bonds theretofore sold. However, plaintiffs (holders of $8,000 of the first series and $3,000 of the second series of bonds) refused to submit their bonds for redemption. The Club then made a deposit in escrow with a bank whereby adequate provision was made for the redemption of plaintiffs’ outstanding bonds, including the principal and interest thereon when due. Plaintiffs do not complain about the adequacy of the security for the redemption of their bonds.

The officers of the Club, acting through trustees, then redeemed all of the outstanding mortgage bonds, exclusive of those held by the plaintiffs, and the liens upon the Club properties were released of record. The newly issued preferred stock did not include any lien upon the Club’s properties.

Plaintiffs sought a declaration that a non-profit corporation such as Club could not lawfully issue preferred stock and that the acts of the Club’s officers and directors in issuing the stock and using the proceeds to redeem the bonds was unlawful and constituted an illegal act.

Although we have been favored with briefs and oral argument by able counsel, we have not been cited to any authority which is remotely dispositive of the questions presented by this appeal. We set out in the margin the authorities cited by plaintiffs and defendant.

We commence our discussion of the problem by quoting from an article by Professor Alan R. Bromberg, “Non-Profit Corporations,” 17 Baylor L.Rev. 125, 153 (1965):

“TNPCA [Texas Non-Profit Corporation Act] does not prohibit the issuance of stock, and stock corporations can be organized under it if they otherwise qualify. Stock is traditional in some nonprofit organizations, particularly country clubs.”

Some support for the foregoing language is to be found in the Act in Tex.Rev.Civ. Stat.Ann. art. 1396 — 2.08 D (1962):

“A corporation may issue certificates, or cards, or other instruments evidencing membership rights, voting rights or ownership rights as may be authorized in the articles of incorporation or in the bylaws.”

The defendant in the case at bar amended its by-laws (but not its articles of incorporation) to authorize the issuance of the preferred stock for use in the redemption of the outstanding mortgage bonds. Thus, under the amended by-laws, the preferred stock evidences ownership rights in and to the golf course and facilities in accordance with such by-laws. Professor Bromberg also refers to an opinion of the Attorney General of Texas, No. WW-880 (July 11, 1960), which in turn mentions Sec. 2.08 D, quoted above, saying that such statute “does authorize the issuance of certificates or cards or other instruments evidencing, inter alia, ownership rights as authorized by articles of incorporation and the by-laws.”

In our view of the problem presented by this record, we recognize that the attorney general’s opinions are not controlling, but they are entitled to great weight unless clearly wrong. San Antonio Union Junior College Dist. v. Daniel, 146 Tex. 241, 206 S.W.2d 995, 998 (1947); Royalty v. Nicholson, 411 S.W.2d 565, 572 (Tex.Civ.App., Houston 1967, writ ref’d n. r. e.).

We are not impressed with plaintiffs’ argument that the preferred stock issued by Club is “simply evidence of a debt of the Appellee [Club] corporation to the investor.” The stock, according to our record and the findings of the court, was validly issued as authorized under Sec. 2.08 D of the Act heretofore quoted. If it is a debt, as contended by plaintiffs, then it is valid as authorized under the provisions of Sec. 2.02 A of the Act. Finding no merit to plaintiffs’ first two points, the same are overruled.

Plaintiffs’ third point, quoted in the margin, is presented without any supporting authority. Plaintiffs admitted that the Club was unable to sell new memberships and could not pay its bonded indebtedness and other debts as they accrued. Yet, the principal and interest upon the bonds had to be paid when due or the Club’s property was subject to foreclosure by the bondholders.

The membership of the Club determined that there was an alternate method of preserving the Club’s assets: the issuance of the preferred stock and the retirement of the mortgage bonds. We are not persuaded that in so doing any of the rights of plaintiffs or other members of the Club were infringed. Certainly, no plaintiff ■ has shown that he has sustained any loss and we are of the opinion that the third point of error is without merit.

The judgment of the trial court is affirmed.

AFFIRMED.

STEPHENSON, J., not participating.

      . Plaintiffs cite: United Housing Foundation, Inc. v. Foreman, 421 U.S. 837, 95 S.Ct. 2051, 44 L.Ed.2d 621 (1975); Tex.Rev.Civ.Stat.Ann. art. 1396, § 2.24 (1962), Texas Non-Profit Corp. Act; 18 C.J.S. Corporations §§ 19, 196 (1939); Fletcher, Cyclopedia of Corporations, Ch. 58, § 5082 (Perm.Ed.1971 Rev.Vol.), and Ch. 3, § 68 (Perm.Ed.1974 Rev.Vol.); and Tex.Att’y Gen. Op. No. WW-880 (July 11, 1960).

      . Defendant cites: Curtis v. National Cash Register Co., 429 S.W.2d 909, 911 (Tex.Civ.App.— Amarillo 1968, writ ref’d n. r. e.); McKenzie v. Carte, 385 S.W.2d 520, 530 (Tex.Civ.App.— Corpus Christi 1964, writ fefd n. r. e.); United Housing Foundation, Inc. v. Foreman, supra (fn. 1); 18 C.J.S. Corporations §§ 18, 196 (1939); and divers sections of the Texas NonProfit Corporation Act, Tex.Rev.Civ.Stat.Ann. art. 1396 (1962).
      The two Texas cases cited by defendant do not touch the substantive problem we have under consideration.

      . The statute is in the disjunctive: “. . .as may be authorized in the articles of incorporation or in the by-laws” (emphasis supplied); the opinion from the attorney general speaks of the matter using the conjunctive “and.” We do not deem the variance to be material.

      . “The Court erred in rendering judgment for Appellee because the first and second mortgage bonds were illegally redeemed.”