Aviation Credit Corp. v. University Aerial Service Corp.

• Decision Date: 17 March 1933
• Docket Number: No. 1047.,1047.
• Citation: 59 S.W.2d 870
• Parties: AVIATION CREDIT CORPORATION OF NEW YORK v. UNIVERSITY AERIAL SERVICE CORPORATION.<SMALL><SUP>*</SUP></SMALL>
• Court: Texas Court of Appeals

Page 870

59 S.W.2d 870

AVIATION CREDIT CORPORATION OF NEW YORK v. UNIVERSITY AERIAL SERVICE CORPORATION.^*

No. 1047.

Court of Civil Appeals of Texas. Eastland.

March 17, 1933.

Rehearing Denied April 21, 1933.

Appeal from District Court, Taylor County; W. R. Chapman, Judge.

Action by the University Aerial Service Corporation against the Aviation Credit Corporation of New York. Judgment for plaintiff, and defendant appeals.

Affirmed.

William H. Russell, of San Antonio, and Martin, Shipman & Winters, of Abilene, for appellant.

Kirby, King & Overshiner, of Abilene, for appellee.

HICKMAN, Chief Justice.

The appellee instituted this suit for the purpose of recovering double the amount of usurious interest alleged to have been paid to appellant under a contract. In due time appellant filed its plea of privilege to be sued in Bexar county, to which appellee filed exceptions as to its sufficiency, and also a controverting plea. Notice of the controverting plea was not served upon appellant or its attorneys. Later in the same term, without notice to appellant, appellee presented its exceptions, which were by the court sustained, and an order was entered striking the plea of privilege from the record. At the institution of its suit appellee caused a writ of attachment to issue and be levied upon two airplanes belonging to appellant and situated in San Antonio. These airplanes were repossessed under a replevy bond executed by appellant as principal and the United States Fidelity & Guaranty Company as surety. When the trial court sustained the exceptions to the plea of privilege, appellee announced ready for trial on the merits; whereupon the court heard the evidence and rendered judgment by default against appellant as principal and the surety on its replevy bond, jointly and severally, for the sum of $2,935.60, it being double the amount of the usurious interest which the court found appellee paid to appellant. Appellant learned of the rendition of this judgment in a short time after it had been entered, and during the same term of court, and immediately filed a motion for new trial, and later filed an amended motion, which was overruled, and this appeal was prosecuted.

The first question for determination relates to the jurisdiction of the trial court to hear and determine the cause. The suit is authorized by, and was prosecuted by, virtue of the terms of article 5073, R. S. 1925. This article provides for the recovery of double the amount of usurious interest paid, and then provides: "Such action shall be instituted in any court of this State having jurisdiction thereof, in the county of the defendant's residence, or in the county where such usurious interest shall have been received or collected, or where said contract has been entered into, or where the parties who paid the usurious interest resided when such contract was made." The appellant is a New York Corporation, and has no domicile in Taylor county, where the suit was instituted. The appellee, a Texas corporation, has its domicile in Travis county, where the usurious interest was paid. The contract was made by correspondence through the mail. If the statute above quoted is not a venue statute, but is jurisdictional, the trial court was not empowered to hear and determine this cause, and the appeal would confer no authority upon this court other than to dismiss the case.

We have before us a copy of the opinion of the Supreme Court in Alpha Petroleum Co. v. Terrell, 59 S.W.(2d) 364, released on February 13, 1933, not yet reported [in State Reports]. We have carefully considered the question in the light of that opinion, and the authorities cited, and in our consideration have had the benefit of supplemental briefs by the attorneys for each litigant. Our conclusion is that article 5073 is a venue statute. All doubt on this question was removed from our minds when our attention was called to the history of the article. The first legislative act providing for the recovery of double the amount of usurious interest paid as a penalty will be found in the Revised Statutes of 1895, as article 3106. That article did not name the counties in which the suit might be instituted. Under that statute it was held that, since the action was one in the nature of an action of debt, the suit to recover same must be brought in the county of defendant's residence. Wartman v. Empire Loan Co., 45 Tex. Civ. App. 469, 101 S. W. 499. The statute was amended by the Thirtieth Legislature by an act approved April 18, 1907, c. 143 (Gammel's Laws, vol. 13, p. 277). This amended law is the same as our present article 5073. The caption and emergency clause of the amendment of 1907 make plain the legislative intent. The caption is as follows: "An Act amending Art. 3106, Title 59, of the Revised Statutes of the State of Texas, 1895, and prescribing the pains and penalties for the collection of usurious interest, and fixing the venue of suits for the recovery of same, and declaring an emergency." (Italics ours.)

The emergency clause is as follows: "The fact that many persons in this state are now engaged in lending money to poor people and exacting promissory notes secured by chattel mortgages therefor, payable in the county of the residence of the payee, and that large sums of money are being collected as usurious interest thereon, and that the persons paying such usurious interest are in most instances compelled to go to a distant county to maintain suits for the recovery of the penalty prescribed for the collection of usurious interest, which practically defeats the purposes of the law, and the fact that the pains and penalties now prescribed by law for the collection of usurious interest are inadequate, creates an emergency. * * *"

A consideration of the caption and emergency clause leads us readily to the conclusion that it was the clear intent of the Legislature to make this a venue statute and not one of jurisdiction.

The trial court did not err in sustaining the exceptions to appellant's plea of privilege. It alleged therein that it was domiciled in, and a resident of, New York State. Nowhere did it allege that it also had a domicile in, or was a resident of, the state of Texas. Venue was sought to be transferred to Bexar county on an allegation that appellant had an agent in that county in the person of James B. Stafford. Article 1995, R. S. 1925, provides: "No person who is an inhabitant of this State shall be sued out of the county in which he has his domicile except in the following cases. * * *" Follow then certain exceptions not necessary here to mention. Article 2007, R. S. 1925, provides: "A plea of privilege to be sued in the county of one's residence shall be sufficient if * * * shall state the county of his residence at the time of such plea." These statutes, by their express terms, are available only to inhabitants of this state, and the only county to which a cause could be transferred upon a plea of privilege is the county in this state of defendant's residence or domicile. There is no statutory authority for transferring a cause by plea of privilege to the county where the defendant has an agent merely, but the whole legislation has to do with the right of a defendant to be sued in the county in which he has his domicile and to protect that right by having cases transferred to that county. This does not at all mean that a foreign corporation could not avail itself of the benefits of these statutes, provided it had established its domicile in this state. For the purpose of venue a party may have more than one residence or domicile, and, notwithstanding the appellant had its domicile in the state of New York, it might have also had one in Texas, but the plea of privilege wholly failed to allege any domicile in Texas, and that omission rendered it fatally defective. This question was before the Fort Worth court in Holcomb v. Williams (Tex. Civ. App.) 194 S. W. 631, 632, and was disposed of in the opinion by Chief Justice Conner in this language: "Evidently the general rule can have no application in this case, for by its terms it is applicable only to inhabitants of this state. Appellee, being an inhabitant of the state of Illinois, does not come within the purview of the general rule."

The next question presented relates to the power of the trial court to render a personal judgment against appellant, a nonresident, after striking its plea of privilege from the record. We agree with appellant's contention that the effect of striking its plea of privilege from the record was to leave the case in the same situation as it would have been had the plea never been filed. Appellant was duly served with a statutory notice to nonresidents. By filing its plea of privilege it entered its appearance. Texas Employers' Insurance Association v. Evans (Tex. Civ. App.) 2 S.W.(2d) 566, and authorities there cited. This plea was stricken from the record. Absent a replevy bond, it is clear to our minds that the court would have been without power to render a personal judgment against appellant, but its judgment should have been one establishing the amount of appellee's claim and ordering a foreclosure of its attachment lien upon the two airplanes against which attachment was run. The estimated value of these planes exceeded the amount of appellee's claim. The replevy bond was in an amount equal to their estimated value. If the filing of a replevy bond by a nonresident who has been served but has filed no answer does not authorize the trial court to render a personal judgment for an amount not exceeding the value of the property replevied, then the plaintiff must lose his rights, because he has not the power to compel the defendant to make a personal appearance. It is the settled law of this state that the filing of a replevy bond is not such an appearance by the defendant as authorizes judgment by default against it and its surety, without the service of process personally, or...