Dallam County v. S. H. Supply Co.

• Decision Date: 30 April 1915
• Docket Number: (No. 6756.)<SMALL><SUP>†</SUP></SMALL&gt
• Parties: DALLAM COUNTY v. S. H. SUPPLY CO. et al.
• Court: Texas Court of Appeals

176 S.W. 798

DALLAM COUNTY v. S. H. SUPPLY CO. et al.

(No. 6756.)^†

Court of Civil Appeals of Texas. Galveston.

April 30, 1915.

Rehearing Denied May 20, 1915.

Appeal from District Court, Jefferson County; John M. Conley, Judge.

Suit by the S. H. Supply Company against Dallam County, W. J. Miller, W. B. Slaughter, and others, with a cross-bill by Dallam County against defendants Miller and Slaughter. Judgment for plaintiff and Slaughter against Miller and Dallam County, and the County appeals. Affirmed.

Smith, Crawford & Mead, of Beaumont, and J. E. Synnott, of Waco, for appellant. Lipscomb & Lipscomb, of Beaumont, for appellee S. H. Supply Co. Townes & Townes and R. E. Hardwicke, all of Beaumont, for appellee W. B. Slaughter.

LANE, J.

On June 19, 1911, one W. J. Miller entered into a written contract with the commissioners' court of Dallam county, Tex., appellant herein, as follows:

"The State of Texas, County of Dallam.

"This agreement made and entered into on this the 19th day of June, A. D. 1911, by and between the commissioners' court of Dallam county, Texas, party of the first part, and W. J. Miller, party of the second part, witnesseth:

"(1) That, in consideration of the matters hereinafter set out, party of the second part agrees to construct a well 3,000 feet deep, subject, to the provisions hereinafter set out, for the sum of six dollars per foot, said well to be constructed in Dallam county, Texas, at any point designated by party of the first part, said well to be properly cased throughout with heavy steel casing, six inches in diameter, inside measure. And party of the second part agrees to furnish material, including all machinery, piping and other merchandise, as well as labor, necessary to the construction of said well, at his own expense, and agrees to begin work on said well not later than August 1, 1911, and to complete said well as soon thereafter as practicable.

"(2) That, in consideration of the matters hereinbefore stated and hereinafter stated, party of the first part agrees to pay party of the second part the sum of six dollars per foot for the construction of the well hereinbefore mentioned, subject to the condition hereinafter set out.

"(3) Party of the second part agrees that in the event gas, oil, or artesian water is found at a depth less than 1,000 feet, and should party of the first part desire to have no greater depth bored, he will cease boring upon payment to him of the sum of six thousand dollars.

"(4) It is mutually agreed that the payments on said well are to be made as follows: When 1,000 feet shall have been bored, there shall be paid the sum of $4.20 for each foot bored, and as each succeeding 100 feet shall be bored a like amount shall be paid, and the remainder shall be paid when said well is completed.

"(5) Party of the first part agrees to pay, on the execution of the bond hereinafter mentioned, the sum of $3,000, which is to be credited on such amount as may be due party of the second part, under this contract, when said well is completed; and upon the completion of said well party of the first part agrees to sell, and party of the second part agrees to purchase, the well machine used, at a price to be determined by one party to be chosen by party of the first part, and one party to be chosen by party of the second part, and one party to be chosen by both of the parties so chosen, and to allow party of the first part credit for such amount as may be thus agreed upon.

"(6) Party of the second part agrees to enter into bond in the sum of $15,000, to be approved by party of the first part, conditioned on the carrying out of this contract.

"Executed in triplicate this the 19th day of June, A. D. 1911.

                      "C. S. Harrington, County Judge
                      "S. H. Tritt, Commissioner
                      "P. T. Frederick, Commissioner
                                "Party of First Part
                      "W. J. Miller
                                "Party of the Second Part."
                

Miller executed the bond provided for in said contract, and thereupon he was paid by Dallam county the $3,000, as provided by section 5 of said contract. About the 1st day of July, 1911, after receiving the said $3,000 under said contract, Miller went to Beaumont and purchased from S. H. Supply Company machinery and other things, including the well rig in question in this suit, paying and promising to pay therefor $3,161.14. He paid $1,500 in cash, and executed his note, or notes, for about $1,200 for a part of the balance of said purchase money, and made other purchases from other parties in Beaumont, paying cash therefor. When he purchased said machinery he told Mr. Boykin, the salesman, that the purchase was for himself and upon his own responsibility. This machinery was shipped to, and received by, Miller in Dallam county about August 1, 1911, and he began the boring of the well mentioned in said contract about that time. On December 11, 1911, Miller executed and delivered his promissory note for the sum of $1,232.71 to the First National Bank of Dalhart, Tex., and gave a mortgage on the property involved in this suit to secure the payment of said note. This note was later transferred to, and became the property of, W. B. Slaughter, a party to this suit. There was still due and unpaid on this note about $700 at date of trial of this case. On the 26th day of December 1911, Miller's indebtedness to S. H. Supply Company had been reduced to $822.85, for which sum he executed and delivered his note to said Supply Company, and also executed and delivered to said company a mortgage on the property in question to secure the payment of said note. Both of said mortgages were promptly and properly filed for record. The note due to the S. H. Supply Company became due, and by its original petition it entered this suit on September 3, 1912, against W. J. Miller in the district court of Jefferson county, at Beaumont, to recover the balance due on said note and for a foreclosure of its mortgage lien on the property in question. After Miller had waived issuance of citation and entered his appearance, the S. H. Supply Company learned that W. B. Slaughter and appellant, Dallam county, were making some claim to, or right in, said property in question, and therefore they were made parties defendant to said suit.

On the 7th day of October, 1912, appellant, Dallam county, filed its original answer, and, among other things, alleged as follows:

"And, further answering herein, this defendant says that at the time the mortgage described in plaintiff's petition was executed by said Wm. J. Miller, and at all times since said date, including the present time, the rotary well-drilling outfit and well-drilling machinery referred to and described in plaintiff's petition was and is the property of this defendant the said county of Dallam; that, if any mortgage was executed by said Wm. J. Miller in favor of plaintiff covering or attempting to cover said well-drilling outfit and machinery, such mortgage was so executed without knowledge of or authority by this defendant. This defendant further says that the mortgage given by said Wm. J. Miller, if any, as set forth in plaintiff's petition, constitutes a cloud on this defendant's title to said property; and, further, that said Wm. J. Miller is at present to be found in said Dallam county, Tex. Wherefore this defendant prays that said Wm. J. Miller be cited to appear and answer this defendant's action in terms of law, that on final hearing hereof said mortgage be adjudged void and held for naught, so far as the same affects and attempts to affect the property of this defendant as hereinbefore set out, that the title of this defendant to its said property be quieted as against the plaintiff and each of the other defendants herein, and this defendant prays for such other and further relief, special and general, as it may be entitled to in law and in equity."

Dallam county also pleaded that Miller was its agent in the purchase of said machinery, and by its first amended answer on December 6, 1912, it pleaded as follows:

"And, specially answering herein, this defendant further says that at the time the mortgage referred to in plaintiff's petition and the mortgage referred to in the other defendant's answer were executed the well rig and machinery in said petition mentioned was the property of the defendant Dallam county, Tex., and that said property is now, and at all times subsequent to the date of said mortgage was and has been, the property of this defendant, and that said mortgages are null and void; that the terms of purchase of said well rig and machinery are set forth in statement marked Exhibit A, and are made a part and parcel of this amended answer. Wherefore this defendant prays that plaintiff and the other defendants herein take nothing by this suit as against this defendant, and that the title to said property be quieted in this defendant, that this defendant go hence without day and recover of the other parties herein all costs in this behalf expended, and for such other and further relief as it may be entitled to in law and in equity."

W. B. Slaughter answered setting up his note and mortgage, and praying for judgment and foreclosure.

On July 10, 1913, Supply Company suggested the death of W. J. Miller, and alleged that Mrs. W. J. Miller, widow of W. J. Miller, and Alfred and James Miller, the minor children of W. J. Miller, were the legal representatives of W. J. Miller, deceased, and that they lived in the state of Arizona, and had them made parties to the suit; proper notice being given to said parties.

On December 22, 1913, appellee Supply Company filed its second amended petition, and, after repeating the allegations of its former petition, made additional alternative plea and prayer, to wit:

"And, further pleading in the alternative, plaintiff shows that, if Dallam county has any claim upon said property, it arises from its being the undisclosed principal of the said Wm. J. Miller in the purchase...