Advance-Rumely Thresher Co. v. Moss

• Decision Date: 09 April 1919
• Docket Number: (No. 6064.)
• Citation: 213 S.W. 690
• Parties: ADVANCE-RUMELY THRESHER CO. v. MOSS et al.
• Court: Texas Court of Appeals

213 S.W. 690

ADVANCE-RUMELY THRESHER CO. v. MOSS et al.

(No. 6064.)

Court of Civil Appeals of Texas.

April 9, 1919.

On Motion for Rehearing, June 18, 1919.

Appeal from District Court, Hamilton County; J. H. Arnold, Judge.

Suit by T. C. Moss and others against the Advance-Rumely Thresher Company. Judgment for plaintiffs, and defendant appeals. Reversed, and judgment rendered for defendant.

Burgess, Burgess, Chrestman & Brundige, of Dallas, and S. P. Sadler, of Gatesville, for appellant.

Dewey Langford, of Hamilton, for appellees.

BRADY, J.

On November 23, 1913, T. H. Moss recovered a judgment in the district court of Hamilton county, Tex., against the Rumely Products Company in an action for fraud and deceit. The cause was appealed and reversed (175 S. W. 1084); but, while it was pending in the Court of Civil Appeals, the Rumely Products Company became insolvent and was placed in the hands of a receiver of the United States District Court of Indiana, of which state it was a citizen, and an ancillary receiver was appointed by the United States District Court for the Northern District of Texas at Dallas.

The cause was again tried in the district court of Hamilton county, and judgment was rendered in favor of plaintiff on September 27, 1915, from which the products company again appealed, filing merely a cost bond, having in the former appeal filed a supersedeas bond. The second appeal was submitted upon the same briefs as the first and was affirmed by the Court of Civil Appeals (189 S. W. 1199), and the products company did not file any motion for rehearing, nor any application for writ of error to the Supreme Court.

Appellees, as heirs of T. H. Moss, filed this suit in the district court of Hamilton county, on August 13, 1917, against appellant, Advance-Rumely Thresher Company, alleging the recovery of the judgment against the products company, and that appellant had purchased all the property of the products company at the receiver's sale; and alleging that the sale was fraudulent, that appellant was merely a continuation of the products company, that it knew of and was a party to the fraud, that appellees held an equitable lien on the property of the products company after its insolvency, and that they were not parties to the proceedings in the federal courts.

In their amended petition, appellees further alleged that the Moss judgment was not adjudicated in the federal court, and that the receivership was dismissed before the judgment was affirmed; that appellant was a continuation of the products company, and had taken over and was continuing the business in Texas of such insolvent corporation; that with knowledge of appellees' claim and judgment, and for the purpose of defeating the collection of same, appellant became the purchaser and took a large amount of property at Dallas, Tex., belonging to the insolvent corporation, which was known by appellant to be subject to their equitable lien, and which was largely in excess of the judgment.

It was alleged in the petition that appellant was a corporation having its principal office in Dallas county, Tex., but having an agent and representative in Hamilton county, Tex. Appellant filed its plea of privilege, claiming its right to be sued in Dallas county, and alleging that it had no agent in Hamilton county. This plea was contested by appellees, and decision thereon was reserved by the court along with the main case. After the evidence was all introduced, the court overruled the plea of privilege, and retained venue and jurisdiction over the cause.

The defenses of appellant were a general demurrer, special exceptions, pleas to the jurisdiction, and a general denial, as well as special answers. It specially denied that it was a part or continuation of the products company, or that it ever took over the business of such corporation in Texas or elsewhere, or that it was continuing such business, but alleged that it was an independent corporation, having no relationship to the products company. It denied being a successor to the products company, or that the latter was interested in its business, and denied that it had taken over the property of the products company with any fraudulent intent or purpose to defeat appellees' debt. It further alleged that it was chartered under the laws of New York, and was doing business in Texas under a permit.

As further special defenses, it averred the receivership proceedings in the federal courts of Indiana and Texas; the turning over to the original receiver by the ancillary receiver of all the Texas property of the products company, and the orders of the federal court in Indiana barring all claims not presented on or before October 5, 1915; the giving of notice to creditors; that appellees had notice thereof and failed to present their claim for allowance within such time; that, under the orders of the Indiana court, the receiver sold all the properties of the products company under the bid of one Chauncey H. Murphy, and the property was conveyed to his nominee or assign, the appellant in this suit; that the federal court ordered the property conveyed to appellant free of all liens and claims of the creditors of the products company or any one claiming under it; that appellant paid to the receiver the consideration bid for the property; and that the judgment of the federal court of Indiana enjoined appellees and all others from asserting any lien or claim against the property in the hands of appellant.

The court rendered judgment for appellees for the amount of the judgment of T. H. Moss, but denied interest thereon. The judgment did not foreclose or establish any equitable lien in favor of appellees, but was a mere moneyed judgment, from which this appeal was taken.

Appellant's brief contains a statement of uncontradicted facts, which is not challenged by appellees, except in one particular, which statement is as follows:

"November 22, 1913, in cause 2091 in the district court of Hamilton county, Tex., T. H. Moss filed suit against the Rumely Products Company for damages growing out of the sale of a threshing machine. Judgment was rendered in favor of Moss, the products company appealed, and the judgment was reversed and remanded March 4, 1915. Judgment was rendered on second trial in favor of Moss September 27, 1915. On appeal this judgment was affirmed October 18, 1916. The first appeal was on supersedeas bond. The second appeal was on cost bond. The second appeal was on the same bills of exception as in first appeal.

"William Connolly & Co. of Hamilton had a commission contract with appellant, and clause 25 provided: `This agreement is special and limited to the matters herein expressly stipulated and the powers explicitly conferred; second party has no authority to accept or receive service of process in any action against the company, or any notice required to be given the company, or to make any contract or agreement or to incur or assume any liability for or on behalf of the company, except as herein specifically provided or when thereunto particularly directed by the company in writing.'

"William Connolly & Co. never did any business in Hamilton county for the appellant under the contract. Appellant never at any time had an office at Hamilton, Tex., or in that community, and have no office at any other place in Texas, than Dallas, in Dallas county. The people who organized and are at the head of appellant never had any connection with the Rumely Products Company. Finley P. Mount never had any connection with the Rumely Products Company.

"Hon. Dewey Langford was the attorney for T. H. Moss and had charge of the collection of this judgment. He knew in January, 1915, while submitting the first appeal, that the Rumely Products Company was in receivership; neither he nor Moss nor plaintiff ever filed any claim in the receivership proceedings.

"The first execution issued on the judgment against the Products Company on October 27, 1915, returned no property found. An alias issued November 29, 1915, another issued April 22, 1916, the latter two to Dallas county; the last one returned no property found in Dallas county.

"F. A. Jones was branch manager for the products company when it did business in this state. He was branch manager for the appellant at time of filing and trial of this suit. F. A. Jones was ancillary receiver under appointment of the District Court of the United States for the Western District of Texas.

"The sheriff of Dallas county presented execution twice to F. A. Jones. The first time Jones informed him that the property of the products company was in hands of receiver.

"In cause No. 96 in equity in the District Court of the United States for the District of Indiana, styled Oliver Chilled Plow Works v. Rumely Products Company, on January 19, 1915, Finley P. Mount was appointed receiver of all the properties of the products company throughout the United States, and foreign countries. The receiver qualified same day. The District Court of the United States for the Western District of Texas on January 21, 1915, appointed F. A. Jones ancillary receiver of all the properties of the Rumely Products Company in Texas, requiring said Jones to act under the jurisdiction of the Indiana court. Jones qualified January 22, 1915. On February 11, 1916, Jones as receiver filed his report in the Texas court showing that he had taken charge of all the property of the products company in Texas and asking authority to deliver same to the principal receiver. On February 12, 1916, the ancillary receiver was ordered to turn all of the property over to the principal receiver. This was done, and receipt of principal receiver approved February 15, 1916, and Jones was discharged.

"On June 11, 1915, the Indiana court made an order limiting the time to the first Monday in September, 1915, in which claims might be filed for approval, and barring all claims not presented within that time. The time was...