Lally v. State, 8933.

CourtCourt of Appeals of Texas
Citation138 S.W.2d 1111
Docket NumberNo. 8933.,8933.
PartiesLALLY v. STATE et al.
Decision Date20 March 1940

Page 1111

138 S.W.2d 1111
STATE et al.
No. 8933.
Court of Civil Appeals of Texas. Austin.
March 20, 1940.
Rehearing Denied April 10, 1940.

Appeal from District Court, Travis County; Ralph W. Yarbrough, Judge.

Action by the State and the Attorney General against Ed Lally to recover contributions or taxes and penalties due from defendant under the Unemployment Compensation Act. From an order overruling defendant's plea of privilege, he appeals.


Harry C. Weeks and R. B. Cannon, both of Ft. Worth, for appellant.

Gerald C. Mann, Atty. Gen., and Geo. W. Barcus, Ocie Speer, and Morris Hodges, Asst. Attys. Gen., for appellees.

Kemper, Hicks & Cramer, of Houston, and Saner, Saner & Jack, of Dallas, amicus curiae.

BLAIR, Justice.

This is an appeal from an order overruling the plea of privilege of appellant, Ed. Lally, to be sued in Tarrant County, the county of his residence. The suit was instituted under authority of the Texas Unemployment Compensation Act, herein referred to as Compensation Law, by the State of Texas and its Attorney General

Page 1112

to recover the contributions or taxes and penalties alleged to be due by appellant as an employer under the Compensation Law. Art. 5221b—12(b) Vernon's Civil Statutes. Venue of the suit was sustained in Travis County under two articles of the statutes,— Art. 7076, which relates to venue of suits of the state for taxes and penalties, and which provides that: "The venue and jurisdiction of all suits arising hereunder is hereby conferred upon the courts of Travis County." And Art. 7076a, which provides that: "It is further specifically provided that all of the provisions of this Act shall apply and be applicable to all delinquent State taxes due and owing to the State of Texas, of every kind and character whatsoever, including all franchise, occupation, gross receipts, gross production, gross premiums tax on insurance companies, inheritance, gasoline, excise and all other State taxes which become delinquent other than State ad valorem taxes on property."

Appellant concedes that if the sums of money sued for are taxes other than state and ad valorem taxes on property, and penalties, then the venue of the suit is properly laid in Travis County under the statutes quoted. We hold that the sums sued for are such taxes and penalties and that the venue of the suit is in the District Court of Travis County.

The Texas Compensation Law (Art. 5221b—1 et seq.) is a comprehensive scheme providing for unemployment benefits to laborers employed within this state by the employers designated therein. It was enacted by the Legislature, among other purposes, to comply with the Federal Social Security Act, 49 Statutes 620-648, 42 U.S.C.A. §§ 301 to 1304, which imposes an excise tax on employers of eight or more employees at progressively increasing rates to be paid into the United States Treasury, and provides that the tax so imposed may be credited with not in excess of 90% of the amount of any contributions paid by such employers under any approved state law. Under the Compensation Law here involved, and when levied and collected by the state organization, the contributions, fines, penalties, and interest are deposited in the State Treasury to a special account designated as the "Unemployment Compensation Administration Fund," which is then transmitted to and deposited in the United States Treasury to a fund designated "Unemployment Trust Fund," which is repaid on the requisition of the state agency for its use in the administration of the state Compensation Law, and the act appropriates all monies so collected for that purpose.

The Texas Compensation Law provides in its title that its enactment is for the purpose of creating and providing an unemployment compensation system and imposes a "tax" on employers of eight or more persons for the purpose of paying unemployment benefits. Its preamble declares that its enactment is for the "public good and general welfare of the citizens of this State," and that "the compulsory setting aside of unemployment reserves to be used for the benefit of persons unemployed through no fault of their own" is necessary. Acts 1936, 3d Called Sess., c. 482, §§ 1, 2. It provides for unemployment benefits, the amount thereof, and the method of computing same. It creates the Texas Unemployment Compensation Commission to administer the state law in accordance with the Federal Social Security Act; and imposes a schedule for "contributions" which each employer is required to pay; and provides for the method for computing the annual "contributions" or taxes; and it provides the method of refund of "all payments of levies and taxes...

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18 cases
  • In re Wm. Akers, Jr., Co., 7411
    • United States
    • United States Courts of Appeals. United States Court of Appeals (3rd Circuit)
    • June 30, 1941
    ...744, 62 P.2d 1037, 63 P.2d 810, 108 A.L.R. 595; Beeland Wholesale Co. v. Kaufman, 234 Ala. 249, 174 So. 516, above cited; Lally v. Texas, Tex.Civ. App., 138 S.W.2d 1111; Fidelity-Philadelphia Trust Co. v. Hines, 337 Pa. 48, 10 A.2d 553; Provident Mutual Life Ins. Co. of Philadelphia v. Unem......
  • Friedman v. American Surety Co. of New York, 7723.
    • United States
    • Supreme Court of Texas
    • April 9, 1941
    ...So. 516; Carmichael v. Southern Coal & Coke Co., 301 U.S. 495, 57 S.Ct. 868, 871, 81 L.Ed. 1245, 1255, 109 A.L.R. 1327; Lally v. State, Tex. Civ.App., 138 S.W.2d 1111, par. 1; Texas Unemployment Compensation Commission et al. v. Campbell, Wise & Wright, Inc., et al., Tex.Civ.App., 119 S.W.2......
  • State v. Kenyon, Inc.
    • United States
    • Court of Appeals of Texas
    • May 14, 1941
    ...that the Act should be construed strictly against the taxing authority. Carpenter v. Bass, Tex.Civ.App., 142 S.W.2d 406; Lally v. State, Tex. Civ.App., 138 S.W.2d 1111. We hold that the purpose and meaning of the Texas Unemployment Compensation Act is that a person shall receive some remune......
  • Magnolia Petroleum Co. v. State, 9518.
    • United States
    • Court of Appeals of Texas
    • November 7, 1945
    ...these articles, since their adoption twelve years ago, in only three of which has the question of venue been raised, Lally v. State, Tex.Civ.App., 138 S.W.2d 1111; Barrett v. State, Tex.Civ.App., 138 S.W.2d 1114; Washington Oil Corporation v. State, Tex.Civ.App., 159 S.W.2d 517, error ref. ......
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