James v. Drye

• Decision Date: 14 January 1959
• Docket Number: No. A-6941,A-6941
• Citation: 320 S.W.2d 319,159 Tex. 321
• Parties: Edward C. JAMES et al., Petitioners, v. Robert W. DRYE et al., Respondents.
• Court: Texas Supreme Court

Page 319

320 S.W.2d 319

159 Tex. 321

Edward C. JAMES et al., Petitioners, v. Robert W. DRYE et al., Respondents.

No. A-6941.

Supreme Court of Texas.

Jan. 14, 1959.

Rehearing Denied Feb. 18, 1959.

Patterson, McDaniel & Moore, Houston, for petitioners.

L. Alvis Vandygriff, Austin, W. T. Barber, San Marcos, Gibson R. Randle, Austin, for respondent, Robert W. Drye.

John C. Foshee and Arthur P. Bagby, Austin, for respondent, C. B. Smith.

DeLange, Hudspeth & Pitman, Houston, Ernest Morgan, San Marcos, for respondent, Eagle Rock Ranch.

GRIFFIN, Justice.

This cause is an appeal from an order of the trial court overruling a plea of privilege, and which action was affirmed by the Court of Civil Appeals. 314 S.W.2d 417.

The parties will be referred to as they were in the trial court. Plaintiffs, Drye et ux. and nine other husbands and wives, filed a suit in the District Court of Hays County, Texas, against petitioners, Edward C. James, Conso Realty Company, a corporation, residents of Harris County, Texas and Eagle Rock Corporation, alleged to be a dissolved corporation, but which was a resident of Hays County, Texas; and against C. B. Smith, a resident of Travis County, Texas, and Eagle Rock Ranch, succeeded by Eagle Rock Ranch, Inc., a corporation residing in Hays County, Texas. James, Conso Realty Company and Eagle Rock Corporation will be called 'James-defendants' and C. B. Smith and Eagle Rock Ranch, Inc. the 'Smith-defendants.'

This writ of error was granted because the holding of the Court of Civil Appeals that the suit was a suit for 'the recovery of lands' or 'damages to land' under Section 14 of Article 1995, Revised Civil Statutes, Vernon's Ann.Civ.St. art. 1995, § 14, is in conflict with the holding of the Courts of Civil Appeals in the following cases: Smith v. Rampy, Tex.Civ.App. Amarillo, 1946, 198 S.W.2d 592; Morris Plan Bank of Fort Worth v. Ogden, Tex.Civ.App. Ft. Worth, 1940, 144 S.W.2d 998, and other similar cases. We approve the holding of the earlier cases that suits against former owners of land who have parted with all title prior to the filing of suit are not suits for 'the recovery of lands', or 'damages to land' within the meaning of Section 14, Article 1995, Revised Civil Statutes, 1925. We have determined that Section 4 of Article 1995 is applicable to this cause and will sustain venue in Hays County, Texas.

Plaintiffs filed their suit for declaratory judgment against the James and Smith-defendants to remove cloud from title to their 'easements', and, in the alternative, for damages against all defendants for the denial of the use of these easements in, on and over the Eagle Rock Ranch.

Plaintiffs alleged that in 1949 James individually owned the Eagle Rock Ranch, and pursuant to a plan and scheme of development organized and controlled Conso Realty Company and Eagle Rock Corporation and Eagle Rock Club; that James conveyed and caused to be conveyed to Eagle Rock Corporation a portion of Eagle Rock Ranch; that Eagle Rock Corporation subdivided its land into Eagle Rock Ranchitos, Subdivisions 1, 2 and 3; that maps dedicating these 'ranchitos' and the lots and blocks therein were filed for record in Hays County, Texas, and the properties were sold with reference to these maps and each deed incorporated by reference certain restrictions regarding the dedicated properties. These restrictions were contained in instruments executed by James as president of Eagle Rock Corporation in 1949 and in 1953 and duly recorded in Hays County, Texas; that one among the restrictions was that no person could become an owner of any part of the 'ranchitos' without also becoming a member of Eagle Rock Club until 1974; that further restrictions provided that all owners of lots in the 'ranchitos' should pay in to a maintenance fund $5 per lot per month. This fund was to go to Eagle Rock Corporation and after sale to the Smith-defendants was to be paid to Eagle Rock Ranch, Inc., and was to be administered by it for the benefit of the lot owners. They alleged such maintenance payment was a vendor's lien against the lot. They alleged further that in pursuance of such development plan each and all of the James-defendants caused to be published and circulated to prospective buyers of lots in the 'ranchitos' certain literature, excerpts of the language of which read as follows:

'While the property outside your own Ranchito is owned by a separate corporation, Eagle Rock Ranch members have an easement over the entire ranch. In other words, members of the club have all the pleasure rights over the entire ranch property. These rights are legally binding against any owner of the property for 25 years, and are subject to renewal after that time.

'The most pertinent fact concerning Eagle Rock is it's unique philosophy of operation. Eagle Rock was founded upon the premise that countless numbers of average income families want an above average home in the hills-as a summer place, as a week-end holiday home or for general escapism whenever that need arises. Certainly the million dollar Eagle Rock Ranch is an above average investment; yet all of Eagle Rock actually becomes a part of your easement when you buy one of the existing ranch homes or buy a lot for construction of the home of your choice. That seems unbelievable until you have had an opportunity to study the facts and perhaps talk to some of the wonderful people who have already bought or built on Eagle Rock. As a part of this million dollar investment and yours to enjoy is a magnificent air-conditioned clubhouse with game room, lounge, beauty shop, snack fountain, dining room, and 21 air-conditioned guest rooms each with private bath for those occasions when your guest problems become run-away. There is a modern paddock, swimming pool heated the year around, a nine hole pitch and putt golf course, tennis courts, a sweeping stream lined with tall shady pecan and walnut trees in which has been stocked literally thousands of blue-gill, bass and crappie.'

Plaintiffs alleged that prior to the purchase of their properties in the 'ranchitos' oral representations to the same effect were made by the agent in charge of the sales of the properties and that such agent took the prospective purchaser over a portion of the Ranch pointing out these various features to corroborate his representations. Plaintiff further alleged that after the purchase of lots and the erection of their respective homes on the purchased properties, they and their families used, exercised and enjoyed free access to the Ranch and clubhouse and grounds and the facilities thereof all in accordance with the printed literature shown them and the representations made to them. In June, 1957, the Smith-defendants closed the clubhouse and denied plaintiffs the right to use their so-called appurtenant easements in the Ranch. Plaintiffs alleged that the James-defendants sold the unsold portion of the Ranch and 'ranchitos' to the Smith-defendants in April, 1955, and that the Smith-defendants had actual and constructive knowledge of the plaintiffs' easements and plaintiffs' actual use and enjoyment of such easements in, on and over the Ranch. Suit was brought against all defendants for an accounting of the sum of $13,000 alleged to have been collected as the maintenance fund. Plaintiffs further alleged that the James-defendants owed them the duty to inform the Smith-defendants of plaintiffs' rights and easements in the Ranch at the time of sale, but that the James-defendants failed to inform the Smith-defendants of plaintiffs' right and had specifically contracted with the Smith-defendants that no one other than the James-defendants and a lienholder had any rights, title or claims in and on the Ranch, and that in the contract of sale, Edward C. James joined in the contract and individually guaranteed the performance of each and every covenant and condition of such contract.

Plaintiffs sued for themselves and as representatives of a class having similar rights and who, as a practical matter, were too numerous to name and make parties. Plaintiffs alleged that after the Smith-defendants succeeded to the title of the James-defendants, the Smith-defendants continued to distribute the James literature and to make similar representations to prospective purchasers. In the alternative, plaintiffs alleged that the action on the part of the Smith-defendants in denying plaintiffs their easements, and the action of the James-defendants in attempting to convey the Ranch and 'ranchitos' and the Club to the Smith-defendants free and clear of plaintiffs' use of the Ranch and Club had lessened the value of the plaintiffs' properties in the 'ranchitos' in an amount of $500,000 and sought damages for such amount against all defendants.

Each of the James-defendants filed pleas of privilege as to plaintiffs' suit and also as to the cross-action brought by the Smith-defendants. These pleas of privilege were amended and were duly controverted and a hearing had. Plaintiffs Drye et al. filed their controverting affidavits to each of the pleas of privilege filed by the James-defendants. In each of these controverting pleas plaintiffs adopted their petition and incorporated the same in the controverting affidavits 'by reference for all purposes as though fully set forth therein.' They alleged, by separate paragraphs, that exceptions 4, 14 and 29a of Article 1995, Revised Civil Statutes, applied and permitted the cause to be tried in Hays County, Texas. Under 4, plaintiffs alleged that they had a valid and bona fide cause of action against the defendants who resided in Hays County, Texas, and that their cause of action against the nonresident defendants grew 'out of a series of closely related transactions which are so intimately connected that they should be joined in order to avoid a multiplicity of suits.' They alleged the facts showing the nonresident defendants to be proper parties to their suit against the resident de...