Allen v. Wilkerson

• Citation: 396 S.W.2d 493
• Decision Date: 17 November 1965
• Docket Number: No. 11339,11339
• Parties: R. K. ALLEN, Garnishee, Appellant, v. Louis Scott WILKERSON, Receiver of Cedar Park Quarries, Inc., Appellee.
• Court: Court of Appeals of Texas. Court of Civil Appeals of Texas

Page 493

396 S.W.2d 493

R. K. ALLEN, Garnishee, Appellant, v. Louis Scott WILKERSON, Receiver of Cedar Park Quarries Inc., Appellee.

No. 11339.

Court of Civil Appeals of Texas, Austin.

Nov. 17, 1965.

Rehearing Denied Dec. 8, 1965.

Moursund & Ferguson, Thos. C. Ferguson, Johnson City, for appellant.

Louis Scott Wilkerson, Austin, for appellee.

PHILLIPS, Justice.

This is a garnishment action wherein the garnishee, appellant here, has been found to be indebted to the garnishor's judgment debtor. The garnisher here is the appellee. Garnishor's judgment debtor had been granted a judgment for $109,000.00 in a prior suit against the Leander Limestone Corporation, said judgment having been transferred to appellee pursuant to a contract approved by the court in said prior suit. Appellee instituted this garnishment proceeding against the appellant as a debtor of the Leander Limestone Corporation. At the conclusion of the trial to the court, the court entered judgment against appellant for $110,670.36. There were no findings of fact or conclusions of law by the trial court in connection with his judgment.

We affirm the judgment of the trial court.

A brief resume of the facts are as follows: A Texas Corporation named Leander Limestone Corporation was formed in 1946 with five persons equally interested and equally owning the stock. R. K. Allen, appellant here, and Chester Lankford were two of the original incorporators. In 1954, R. K. Allen acquired the stock of the other three incorporators bringing his percentage of the ownership of the capital stock to 80% thereof. Chester Lankford continued to own his capital stock and to remain active in the corporation until his death in 1963. The principal business of Leander Limestone Corporation was the processing of limestone for building purposes.

Another Texas Corporation by the name of Whitestone Lime Company was organized by appellant, R. K. Allen, and Guy E. Green and began doing business in 1956. The majority stockholders of the Whitestone Lime Company (and its successor White Stone & Lime Company) were appellant Allen, his wife, son and daughter, and Guy E. Green, his wife, son and daughter.

In 1961, a receivership proceeding was instituted as to the White Stone & Lime Company in the District Court of Williamson County, Texas.

Garnishor appellee is receiver of Cedar Park Quarries, Inc., having been so appointed by the District Court in Austin in a prior proceeding.

In another suit in the District Court in Austin docketed as No. 92,981-B, and Joe Amberson, Jr., Independent Executor of his father's estate, recovered judgment against Leander Limestone Corporation for the abovementioned sum of $109,000.00. Thereafter, Joe Amberson, Jr. contracted with garnishor appellee to assign this judgment to the garnishor appellee. The receivership judge found that the contract was to the best interest of the receivership (Cedar Park Quarries, Inc.) estate and approved the contract.

In the case at bar, the writ of garnishment was issued in May of 1964 upon a recited judgment for $109,000.00 in the above-mentioned Cause No. 92,981-B. Appellant Allen answered and the case was tried in Williamson County with the result as announced above.

I.

Appellant Allen's first point of error in this Court is that of the District Court in granting appellee judgment against appellant for $110,670.36 because appellee as garnishor failed to meet the burden of proof resting upon him to establish by a preponderance of the evidence a prima facie case against Leander Limestone Corporation as alleged, and specifically failed to establish a judgment which he was entitled to assert herein or that there was an indebtedness owing by appellant to Leander Limestone Corporation subject to the writ of garnishment, or the amount thereof.

We overrule this point.

The general rule is that, in order to contest a plaintiff's capacity to sue, objection must be made by a plea in abatement in the trial court and cannot be urged for the first time on appeal. 44 Tex.Jur.2d, Parties, 223-225. Such rule may in some cases not be applicable to a governmental agency which has only the particular capacities specified in the judicially noticed statute creating such agency. Such appears to have been the view taken in Ortiz Oil Co. v. Railroad Commission, Tex.Civ.App., 62 S.W.2d 376, no writ history, decided in 1933, relied upon by garnishee. But the rule has been squarely held applicable by this Court to suit by a receiver, and it now appears required to be applied by virtue of subdivision (c) of Rule 93, Texas Rules of Civil Procedure, adopted in 1940. Roberson v. Board of Insurance Com'rs of Texas, Tex.Civ.App., 171 S.W.2d 542, 543, pt. 1, er. dism., decided in 'could not' assign the judgment to

Actually, this receiver did not need a specific grant of authority from the 53rd District Court to try to collect the judgment upon which this suit is based. Once the property interest in such judgment was placed in the receiver's hands, the receiver was authorized by Article 2310, Vernon's Ann.Civ.St., ¹ to sue for collection thereof 'without leave of the court appointing him.'

Garnishee's assertion that Amberson 'could not' assign the judgment o the receiver and that the 53rd District Court lacked 'jurisdiction' to authorize the receiver to sue thereon is without merit. The contract and court order approving it do not expressly recite that Amberson was already a party in the receivership case; but such is clearly inferable from the provisions of the fifth paragraph of such contract. But, even if Amberson theretofore had not been a party in the receivership case, he became such when he voluntarily contracted with the receiver subject to the 'approval' of the receivership judge. Security Trust Co. of Austin v. Lipscomb County, 142 Tex. 572, 180 S.W.2d 151, 158, col. 2. And thereafter any and all questions relative to the propriety of the receiver's acquisition of such judgment and of all orders as to what he should do with it could be raised only directly in such receivership case, not by collateral attack such as is now made by the garnishee in this Court. Ibid., 180 S.W.2d at 155-157.

Just as an appointment of a receiver by a court having jurisdiction to appoint and proceedings taken in such receivership are not subject to collateral attack (Robins v. Sandford, Tex.Com.App., 29 S.W.2d 969), so also an order authorizing a receiver to institute suit in the same State is not subject to collateral attack. A case very closely in point is Grant v. H. B. Leach & Co., 280 U.S. 351, 50 S.Ct. 107, 74 L.Ed. 470. In that case a defendant, sued in a federal court by an Ohio state court appointed receiver, challenged the receiver's authority to sue. The United States Supreme Court held that an Ohio statute practically identical with our Article 2297, V.A.C.S., gave the Ohio state court 'jurisdiction' to determine actions its receiver might bring; and it then held:

'* * * But even if this ware not the case, the order specifically authorizing and directing the receiver to bring the action in the (federal) district court was one which the common pleas court had jurisdiction to make in the exercise of its discretion and under the construction which it placed upon the statute; and, as such, was not one which, even if erroneous, was subject to the collateral attack which Leach & Company sought to interpose in the (federal) district court. * * *'

Likewise we overrule the second part of garnishee's first point to the effect that garnishor 'failed to establish * * * an indebtedness owing by appellant to Leander Limestone Corporation subject to the writ of garnishment, or the amount thereof.' Substantial evidence support the trial court's ultimate finding that garnishee was indebted to Leander in the sum of $110,670.36 when writ of garnishment was served.

On appeal after nonjury trial, with no request having been made for specific fact findings, it will be presumed that the trial court resolved every disputed fact issue in favor of the appellee and that the evidence will be viewed in the light most favorable to the trial court's presumed findings, disregarding all that is contrary thereto. McWilliams v. Muse, 157 Tex. 159, 300 S.W.2d 643.

Garnishee states in his brief that garnishor contended himself with proving that there was a ledger account on the books of Leander Limestone Corporation denominated 'Notes and Accounts Receivable R. K. Allen,' which began with an entry of '9/30/59 (which was about eight months after R. K.'s and Tom Allen's trip to Argentina). ² Balance per work sheet' and a debit entry of $43,331.95 * * * and that it showed a present debit balance of $110,670.36-which is the same sum the trial court found garnishee to be indebted to Leander when garnishment writ was served on him in this case.

Garnishor proved such ledger account to the satisfaction of the court. On Tom Allen's deposition taken on May 15, 1964, he testified that he was vice-president and office manager of Leander, that the ledgers and journals of Leander were kept under his supervision, that a certified public accountant checked his work. He produced Leander's accounts receivable ledger. With such ledger then before him he testified that R. K. Allen 'has taken money out of the corporation from time to time to reinvest in this Argentinian Project.' Referring to an account entitled 'Notes and Accounts Receivable R. K. Allen' in the ledger book, Tom Allen testified that such account 'is the accountant's way of showing his obligation to the corporation.' Tom Allen further testified that such account would be debited when R. K. Allen took money out of the corporation and would be credited with whatever he paid back.

He further testified that R. K. began to take money out of Leander for the Argentina operation 'Approximately 1959,' that he (Tom) had check writing authority 'since early '59,' that by and large the (Tom) signed most of the checks by which...