Hidalgo County W. Control & Imp. Dist. No. 1 v. Goodwin

• Decision Date: 12 March 1930
• Docket Number: No. 1340-5460.,1340-5460.
• Citation: Hidalgo County W. Control & Imp. Dist. No. 1 v. Goodwin, 25 S.W.2d 813 (Tex. 1930)
• Parties: HIDALGO COUNTY WATER CONTROL AND IMPROVEMENT DIST. NO. 1 v. GOODWIN et al.
• Court: Texas Supreme Court

25 S.W.2d 813

HIDALGO COUNTY WATER CONTROL AND IMPROVEMENT DIST. NO. 1 v. GOODWIN et al.

No. 1340-5460.

Commission of Appeals of Texas, Section A.

March 12, 1930.

Error to Court of Civil Appeals of Fourth Supreme Judicial District.

Suit by Hidalgo County Water Control and Improvement District No. 1 against E. M. Goodwin and others. To review a judgment of Court of Civil Appeals [14 S.W.(2d) 321], affirming judgment for defendant, plaintiff brings error.

Reversed and remanded.

Neal A. Brown and Geo. P. Brown, both of Edinburg, Don A. Bliss, of San Antonio, and Cofer & Cofer, of Austin, for plaintiff in error.

Jas. R. Dougherty, of Beeville, Vernon B. Hill, of Mission, for defendants in error.

SHARP, J.

This suit was instituted in the district court of Hidalgo county by Hidalgo County Water Control and Improvement District No. 1 against E. M. Goodwin and Hidalgo County Water Control and Improvement District No. 6 for the specific performance of a certain clause in a contract in writing made between plaintiff and E. M. Goodwin, which clause reads as follows:

"Should it be necessary that any additional permit to take water from the Rio Grande River be secured in order to supply the lands to be supplied under the terms of this contract with water for irrigation purposes, then the said Goodwin and his assigns bind themselves to secure such water permit and to convey same to Hidalgo County Water Control & Improvement District Number 1. It is further agreed, however, that in the event the said E. M. Goodwin should be unable to obtain a permit from the Board of Water Engineers to take water from the Rio Grande for the irrigation of said land, the Hidalgo County Water Control & Improvement District No. 1 hereby agrees to assign and transfer to the said E. M. Goodwin, or his assigns, a sufficient amount of water of the Rio Grande River, which is already owned by the said Hidalgo County Water Control & Improvement District No. 1."

Plaintiff further alleged that Goodwin, prior to June 26, 1926, had procured an option to purchase about 5,600 acres of land in porciones 48, 49, 50, 51, and 52 in Hidalgo county or at least in some one or more of the porciones; that plaintiff owned a water appropriation under the laws of Texas for the irrigation of lands in the porciones above described, and had constructed its main line of canal on and over the lands and had finished a pumping plant on the Rio Grande river at or near the village of Penitas, and that the pumping plant and canal had an ample capacity to supply water for irrigation purposes to not only the lands in plaintiff's district, but also to all lands in the porciones above described, and at the time plaintiff was actually operating the pumping plant and main canal, and that it had already sold and conveyed permanent water rights appurtenant to the lands in the porciones above described, unto owners thereof, aggregating 2,031.94 acres, for which the owners had agreed to pay the sum of $15 per acre for the permanent water rights in addition to the conveyance of the right of way through their lands for the main canal.

That E. M. Goodwin, knowing these facts, approached the plaintiff for the purpose of obtaining an option to purchase a permanent water right to irrigate the 5,600 acres of land, of which he had obtained an option, and, if possible, to organize a water and control district, embracing about 25,000 acres of land in the porciones above described, including the 5,600 acres of land upon which he had an option to purchase, and further desired to procure from plaintiff an option to purchase a permanent water right, and also a contract as to prices at which an actual water supply would be furnished by plaintiff out of its main canal for the lands.

It is further alleged that Goodwin informed plaintiff that he had asked the state board of water engineers for a new appropriation of water covering the lands in the porciones described above and that plaintiff's attorney, after the conference, agreed to assist in getting the permit from the state board of engineers, and plaintiff would waive its rights, and that the permit so obtained from the board of water engineers would be transferred by Goodwin to plaintiff; that by reason of said agreement, Goodwin obtained the water permit from the board of water engineers, and, instead of transferring it as he had agreed to plaintiff, he transferred it to the Hidalgo County Water Control and Improvement District No. 6; that the Hidalgo County Water Control and Improvement District No. 6 had actual notice of the contract Goodwin had with plaintiff to convey to plaintiff the water permit when obtained.

Among other things, plaintiff prayed for damages, etc. Defendants filed general demurrer, special exceptions, general denial, etc. The pleadings are voluminous and all of the allegations made by plaintiff and the matters contained in the answers made by defendant will not be detailed herein, but will be set out as is necessary for a decision of this case.

The contract entered into by and between plaintiff and E. M. Goodwin, and out of which this controversy arose, is as follows: "State of Texas, County of Hidalgo.

"The contract this day made and entered into between the Hidalgo County Water Control & Improvement District No. 1 and E. M. Goodwin, is as follows:

"(a) It is contemplated by the said E. M. Goodwin that a water improvement district, or a water control and improvement district, shall be organized under the laws of Texas to embrace lands in Porciones 48, 49, 50, 51 and 52, in Hidalgo County, Texas, and after the incorporation of such a district, said district as so incorporated shall have the right at its option to contract with the said Hidalgo County Water Control and Improvement District No. 1, as hereinafter set forth, and that in the event no such district should be organized under the laws of the State of Texas, then the said E. M. Goodwin at his option shall have the right to contract with the said Hidalgo County Water Control and Improvement District No. 1 upon the terms and under the conditions as hereinafter set forth.

"(b) The contract herein provided to be made between the said Hidalgo County Control & Improvement District No. 1, Party of the First part, and the said E. M. Goodwin, Party of the Second part, is as follows:

"1. The said Hidalgo County Water Control & Improvement District No. 1 agrees with the said E. M. Goodwin that it will furnish unto the said E. M. Goodwin, or his assigns, a supply of water sufficient to properly irrigate a minimum of 5,600 acres of land in said Porciones, and a maximum amount sufficient to irrigate 25,000 acres in said Porciones, for which the said E. M. Goodwin, or his assigns, is to pay the Hidalgo County Water Control & Improvement District No. 1 at the rate of $17.50 per acre as the price of a water right to be extended by the said Hidalgo County Water Control & Improvement District No. 1 to the lands embraced within the Water Improvement District or Water Control and Improvement District, to be organized, or included in the irrigation system installed by the said E. M. Goodwin, and being lands out of said Porciones 48, 49, 50, 51, and 52, the payment of said $17.50 per acre to be made as follows:

"On or before nine (9) months from the ____ day of ____, 1926; it being understood, however, that it is contemplated by the E. M. Goodwin to perfect the organization of said Water Improvement or Water Control and Improvement District, and that bonds will be voted and marketed for the purpose of constructing the pumping plants and canals, and of paying for the water right hereby contracted to be conveyed, it is further agreed that in the event the said E. M. Goodwin should be unavoidably delayed in the organization of said District and the marketing of the bonds of said District, as above provided for, upon satisfactory proof to the Board of Directors of the Hidalgo County Water Control & Improvement District No. 1 that fair and reasonable progress is being made in the perfection of said District and the marketing of said bonds, a reasonable extension of time for the payment of said $17.50 per acre to the Hidalgo County Water Control & Improvement District No. 1, shall be granted to the said E. M. Goodwin for the purpose of perfecting the organization of said District and the marketing of said bonds by said District.

"2. In addition to said charge for said water right, the said E. M. Goodwin agrees to pay to the said District at the rate of $2.50 per acre foot for each actual delivery of water, based on the price of fuel oil at $1.75 per barrel and for each 10 cents in excess in the price of said fuel oil per barrel said District shall have the right to increase said charge at the rate of 12 cents per acre foot, during such time as the price of said fuel oil shall be in excess of $1.75 per barrel; the minimum price to be $2.50 per acre foot, unless and in the event said District shall reduce the price of the water charge to the land owners within its District to a less sum than $2.50 per acre, then and in that event the rate herein provided for to be charged to the said E. M. Goodwin, or his assigns, shall be reduced proportionately to the reduction made to the land owners within said Hidalgo County Water Control & Improvement District No. 1.

"3. The said E. M. Goodwin agrees to pay for 250 acres feet of water for the first year after the said district to be organized by him, or the irrigation system to be established by him, is ready to receive water for the irrigation of said lands included therein, whether such water should be used or not and that such fixed charge shall increase each year at the rate of 250 acre feet until the minimum yearly charge shall be for the same number of acre feet as the number of irrigable acres of land in the district to be organized or under the system to be established by the said E. M. Goodwin.

"4. Said charge for water...