State v. Wynne

Decision Date14 January 1938
Docket NumberNo. 13632.,13632.
PartiesSTATE v. WYNNE et al.
CourtTexas Court of Appeals

Appeal from District Court, Van Zandt County; G. O. Crisp, Judge.

Suit by B. J. Wynne and others against the Star Refining & Producing Company to recover on a note and to foreclose a mortgage lien, wherein the State of Texas, the United States and others intervened. From a judgment, the State of Texas appeals.

Affirmed.

William McCraw, Atty. Gen., and Pat M. Neff, Jr., Asst. Atty. Gen., for the State.

Julius H. Runge, of Dallas, for appellee A. M. Lockett & Co., Ltd.

Wynne & Wynne, of Wills Point, for appellee B. J. Wynne.

Julius H. Runge, of Dallas, and Robert Sansom, of Fort Worth, for appellee James Harrison.

Geo. M. Conner, of Fort Worth, for appellee R. F. Milam, trustee.

Wren, Pearson & Jeffrey, of Fort Worth, for appellee A. T. & S. F. Ry. Co.

Massingill & Belew, Homa Hill, and B. B. Paddock, all of Fort Worth, for appellee W. B. Harrison.

Clyde O. Eastus, U. S. Atty., and Frank B. Potter, Asst. U. S. Atty., both of Fort Worth, and J. L. Backstrom, Sp. Atty., Bureau of Internal Revenue, of Dallas, for the United States.

Wynne & Wynne, of Wills Point, for appellees Herman Gartner, C. L. Wilson, Bert K. Smith, Oscar Vogel, W. M. Harrison, Clara Mabry, Myrtle Moad, Joe King, J. B. Craddock, Guardian, and J. B. Moon.

Harris & Palmer, of Dallas, for appellee Centennial Oil & Gas Co.

Samuels, Foster, Brown & McGee, and A. M. Herman, all of Fort Worth, for appellees Jean Craddock Lewis et al.

DUNKLIN, Chief Justice.

This suit was instituted by B. J. Wynne on May 12, 1935, against the Star Refining & Producing Company, to recover on its promissory note, in the principal sum of $2,000, of date September 22, 1932, payable 90 days after date, with interest and attorney's fees, and to foreclose the mortgage lien upon all the real property and other assets of the defendant, located in the county of Tarrant, State of Texas, given by defendant to secure twenty five-year first mortgage 8 per cent. bonds that were hypothecated to plaintiff at the time said note was executed as security therefor. Plaintiff alleged that the defendant is indebted to the federal government for taxes in the sum of $12,000, and to the State of Texas for gasoline taxes in the sum of approximately $18,000; and that the defendant is insolvent or threatened with insolvency and without means to pay said taxes, since its capital stock and surplus on hand has been exhausted and it has no cash assets with which to pay its debts.

Further allegations were to the effect that the market for defendant's refined products has been broken by competition with dealers in "hot oil," operating in violation of the law, and by reason thereof, it has been impossible now to refine crude oil with profit and thus realize funds to pay its indebtedness by further operating its business.

It was further alleged that the federal and state governments were both threatening to file liens against the defendant's assets and thus further jeopardize the interests of all holders of the series of five-year first mortgage 8 per cent. bonds, which include the twenty, now held by plaintiff as collateral security for the note in suit. By reason of the facts noted, plaintiff prayed for immediate appointment of a receiver to take charge of the defendant's property and hold it, subject to orders of court.

The petition was duly verified, and on the same day of its filing the defendant filed its answer thereto, entering its appearance, waiving any notice of hearing of the application, and also praying for appointment of a receiver, upon allegations of the same facts with extended elaboration of details.

Immediately upon the filing of the petition and answer, Hon. G. O. Crisp, judge of the court in which the suit was instituted, filed his order, appointing W. M. L. Johnson receiver to take charge of the property and hold the same until further orders from the court, and requiring the receiver to file bond in the sum of $2,000, conditioned as required by law.

The receiver so appointed duly qualified by giving the prescribed bond and taking the necessary statutory oath and took charge of all assets belonging to the defendant.

The federal government filed its claim of prior and superior lien under its internal revenue laws, on the assets of the defendant company in the hands of the receiver, for gasoline taxes, together with proof of filing with the county clerk of Tarrant county notice of its claim of lien therefor.

The State of Texas intervened for occupation taxes owing by the defendant company as a distributor of gasoline, under provisions of article 7065a, Vernon's Ann. Tex.Civ.St., Acts 1929, 2d Called Sess., c. 88, § 17, as amended by Acts 1931, c. 98, § 2, with a claim of lien on the property in the receiver's hands and described in the judgment, prior and superior to the lien of the federal government and to the claims of all other interveners.

The names of other interveners and claims asserted by them appear in the judgment.

The case was tried without a jury, and following is a copy of the judgment rendered on June 30, 1936, omitting certain unnecessary repetitions:

"1. The Court overrules the demurrer and denies the motion to strike and dismiss filed herein by the State of Texas as to the amended claim of the United States, allowing the State of Texas' exception thereto. The court also overrules all other preliminary pleas, demurrers and exceptions filed to any of the claims considered herein.

"2. All of the claims set forth herein were presented to the receiver prior to the date of this hearing, and were approved and allowed by the receiver in the amounts claimed.

"3. On the 12th day of March, 1932, A. M. Lockett & Company, Ltd., a corporation, sold to the defendant, Star Refining & Producing Company, the following described personal property:

"1 Worthington 20 × 6 × 24 horizontal simplex outside end packed plunger hot oil pump.

"1 Worthington 8 × 4 × 12 simplex pot valve type steam pump.

"1 Worthington 1-1/2" Type U-1 two-stage, horizontal split case, volute centrifugal pump.

"1 7-1½ HP General Electric Type Ft, 440 volt, 3 phase, 60 cycle, 3600 RPM standard high reactance, squirrel cage induction motor.

"1 CR-7006-D40 full voltage magnetic starter furnished with overload protection.

"Said sale was evidenced by a written contract, introduced in evidence in this case, in which title was retained by the seller in it until said property should be fully paid for, and said contract was filed for record in the chattel mortgage records of Tarrant County, Texas, the county in which the property was to be situated, on the 18th day of April, 1932.

"4. On April 26th, 1932, the defendant and intervener, Lockett & Company, entered into a supplemental written contract, in which also the title to the property above described was retained, and the real estate on which the property was to be situated and described, and this instrument was filed for record in Tarrant County, Texas, on the 5th day of May, 1932, in duplicate, and one copy was filed by the county clerk in the chattel mortgage records of machinery on realty, and one copy was filed in the chattel mortgage records of said county.

"5. Said original indebtedness, evidenced by notes, and secured by the chattel mortgage and mortgage on machinery situated on realty held by the intervener, Lockett & Company, has not been paid in full, but certain payments have been made, and at the special instance and request of the defendant, certain renewal notes were executed by the defendant, and accepted by the intervener, Lockett & Company, but there was no change in the mortgages mentioned. The notes now held by the intervener represent an extension of the original indebtedness and were taken in extension and in renewal, and in lieu of the original notes, and the original indebtedness has never been released by the intervener, and there is no evidence before this court of any intention to release or to waive the indebtedness or lien held by this intervener, but on the contrary all the evidence indicates that the intention was to retain the lien to secure the payment of the notes accepted in renewal of the original indebtedness. The indebtedness has been reduced to a comparatively small amount from the original amount contracted to be paid. The amount of the debt now owing by the defendant to A. M. Lockett & Company, Ltd., as evidenced by the notes given for said machinery and property, is as follows: $525.00 principal, $102.37 interest to July 1, 1936, and 10% attorney's fees on the full amount of principal and interest, making the total amount due on July 1st, 1936, of $690.10. Said intervener has a chattel mortgage lien upon the property described above, and a lien on machinery situated on realty on the property above described to satisfy its indebtedness in the amount above stated, and said liens are prior and superior to all other liens asserted in this case against the property above described.

"6. The defendant entered into a written agreement with the intervener, A. M. Lockett & Company, Ltd., dated April 26th, 1932, by the terms of which the defendant pledged with intervener eighteen 5-year first mortgage eight per cent gold bonds, dated July 1st, 1928, and pledged said bonds as collateral security for the payment of said indebtedness above mentioned, and later these bonds were exchanged at the request of the defendant for a like amount of bonds of the issue dated June 1st, 1933, that amount being $1800.00, par value of said bonds, and the intervener is entitled to a foreclosure of its pledgee's lien upon said bonds at this time, said bonds being numbers 36 to 53, both inclusive, being each for the principal amount of $100.00 and being known as 5-year first mortgage eight per cent gold bonds, dated June 1st, 1933, payable to bearer, and being...

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4 cases
  • State v. Wynne
    • United States
    • Texas Supreme Court
    • December 6, 1939
  • Standard Oil Co. v. Stone
    • United States
    • Mississippi Supreme Court
    • May 12, 1941
    ...2 So.2d 155 191 Miss. 897 STANDARD OIL CO., Incorporated In Kentucky, v. STONE, Chairman State Tax Commission. No. 34572.Supreme Court of MississippiMay 12, 1941 [2 So.2d 156] ... Lyell ... & Lyell, of Jackson, for appellant ... Rio Grande Irrigation Company on Claim of Hidalgo & ... Cameron Counties, D.C., 21 F.Supp. 492; and Wynne, A. M ... Lockett & Company v. State of Texas, 310 U.S. 610, 60 ... S.Ct. 980, 84 L.Ed. 1388; State v. Wynne, 134 Tex ... 455, 133 S.W.2d 951; ... ...
  • State v. Nix, 7574.
    • United States
    • Texas Supreme Court
    • December 6, 1939
    ...Theater Corp., D.C., 7 F. Supp. 399; State of N. Y. v. Maclay et al., 288 U.S. 290, 53 S.Ct. 323, 77 L.Ed. 754; State of Texas v. Wynne, Tex.Civ.App., 113 S.W.2d 325; Churchill v. Straus Investing Corp., D.C., 25 F.Supp. "The State of Texas claims a first, prior and preferred lien on all th......
  • State v. Lowman, 7427.
    • United States
    • Texas Supreme Court
    • December 6, 1939
    ... ... The Court of Civil Appeals affirmed the judgment of the trial court. 115 S.W.2d 794 ...         This case involves the same questions presented in the case of State of Texas v. B. J. Wynne et al., the opinion of the Court of Civil Appeals being reported in 113 S.W. 2d 325. The two cases were heard together ...         We have this day handed down our opinion in the case of State of Texas v. B. J. Wynne et al., reported in 133 S.W.2d 951, and the judgments of the trial court ... ...

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