Loomis Land & Cattle Co. v. Diversified Mtg. Investors

• Decision Date: 29 January 1976
• Docket Number: No. 864,864
• Citation: 533 S.W.2d 420
• Court: Texas Court of Appeals
• Parties: LOOMIS LAND & CATTLE COMPANY et al., Appellants, v. DIVERSIFIED MORTGAGE INVESTORS, Appellee.

Page 420

533 S.W.2d 420

LOOMIS LAND & CATTLE COMPANY et al., Appellants, v. DIVERSIFIED MORTGAGE INVESTORS, Appellee.

No. 864.

Court of Civil Appeals of Texas Tyler.

Jan. 29, 1976.

Rehearing Denied Feb. 26, 1976.

William Andress, Jr., Andress, Woodgate & Lodewick, Dallas, for appellants.

Peter A. Franklin, III, Stanley E. Neely, Locke, Purnell, Boren, Laney & Neely, Dallas, for appellee.

MOORE, Justice.

This is an appeal from a summary judgment. The litigation commenced when appellant, Loomis Land and Cattle Company (Loomis Company), filed suit in the 162nd District Court of Dallas County to enjoin the sale of a shopping center by the substitute trustee, acting under the terms of a note and a deed of trust executed by Loomis Company and Richard F. Loomis as guarantor to appellee, Diversified Mortgage Investors (Diversified). The right to have the sale enjoined was based upon the grounds that (1) appellee, Diversified, being a Massachusetts trust was not a recognizable entity under the laws of this state and was therefore without standing in court to pursue any of the remedies arising under the contract, (2) that Diversified's appointment of a substitute trustee was invalid and (3) that the interest on the note was usurious. On Friday, December 28, 1973, the trial court granted Loomis Company's application for a temporary restraining order at approximately 2:30 p.m. and set the matter for hearing on January 4, 1974. Within about two hours after the restraining order was issued, the substitute trustee along with Diversified's attorney, together with the attorneys for Loomis Company, appeared before the court, at which time the attorneys for Diversified orally requested the court to either set an immediate hearing to dissolve the restraining order or to increase the amount of the bond and appoint a receiver. The trial court made no ruling but set a hearing on Diversified's request for 9:00 a.m., January 2, 1974. In the meantime, the attorneys for the parties engaged in negotiations and discussion regarding the appointment of a receiver. Diversified's attorney proposed that if Loomis Company would pay Diversified on January 2nd an amount equal to the January rentals, Diversified would postpone its motion for appointment of a receiver until about January 25th. Having heard nothing from the proposal, counsel for Diversified appeared in court on January 2nd at about 8:35 a.m. and filed Diversified's original answer and motion for the appointment of a receiver. Thereafter, informal discussions took place between the trial judge and the attorneys for both parties regarding the appointment of a receiver; then at about 10:15 a.m. the District Clerk of the 162nd District Court delivered the trial judge a motion for a non-suit, together with an order granting Loomis Company a nonsuit which order had been signed by Judge Snodgrass of the 193rd District Court acting for the judge of the 162nd District. The motion for nonsuit was surreptitiously filed by Loomis Company's attorney at 6:23 a.m. on January 2nd and the order of nonsuit was entered by the judge of the 193rd District Court without notice to either Diversified's counsel or the judge of the 162nd District Court at 8:15 a.m. Subsequently, upon motion made by Diversified, the trial court set aside the order of nonsuit and appointed a receiver to collect the rents from the shopping center. On February 5, 1974, the temporary restraining order restraining the sale having expired, the substitute trustee proceeded to sell the shopping center at public auction for the sum of $2,250,000.00. Within approximately thirty minutes after the trustee's sale Loomis Company filed a trespass to try title suit seeking to establish title to the property on the ground that the trustee's sale was invalid. The suit was assigned to the 101st District Court of Dallas County. Thereafter, upon Diversified's motion to transfer and consolidate, the suit was transferred to the 162nd District Court and consolidated with the original suit, being numbered 73--9632--I. After the transfer and consolidation, Diversified proceeded to amend its pleading asserting a counterclaim for a deficiency judgment against Loomis Company. Diversified also filed a cross-claim seeking a deficiency judgment against Richard F. Loomis, individually, as guarantor of the note.

The cause came on for hearing before the trial court on Diversified's motion for summary judgment pursuant to Rule 166--A, Texas Rules of Civil Procedure. After a hearing the trial court rendered a summary judgment against Loomis Company and Richard F. Loomis, jointly and severally, for $214,093.52 representing the deficiency on the note, plus interest thereon at the rate of 15% Per annum from February 5, 1974, together with all costs. Loomis Company and Richard F. Loomis, Jr., perfected this appeal. The parties will hereafter sometimes be referred to as 'appellants' and 'appellee.'

Appellants seek a reversal by three points of error. For convenience, we will first consider appellants' third point contending that the trial court erred in granting Diversified's motion for summary judgment. In connection with this point, appellants assert six basic reasons why the summary judgment should be reversed.

First, they contend they were entitled to take a nonsuit as a matter of right. Based on this premise, they argue that the trial court had no authority to set aside the nonsuit. Consequently, they contend the trial court lost jurisdiction over the parties and the subject matter and therefore had no power to reinstate the original suit and likewise had no power to consolidate their subsequent action of trespass to try title into the original suit.

Rule 164, Texas Rules of Civil Procedure, grants a plaintiff a right to take a nonsuit, but such right is not without limitations. Renfroe v. Johnson, 142 Tex. 251, 177 S.W.2d 600 (1944). The question here is whether the filing of a motion for nonsuit and the entry of an order of dismissal by another court of concurrent jurisdiction without notice to opposing counsel or the trial judge of the court where the cause is pending, will defeat the adverse party's right to file an answer seeking affirmative relief. A similar situation was presented in the case of Cape Oil Company v. Williams, 427 S.W.2d 122 (Tex.Civ.App.--Tyler 1968, no writ). In that case, this court held that the plaintiff's right to a nonsuit did not become absolute until after the motion was filed and brought to the attention of the court and opposing counsel. In the instant case, the undisputed proof shows that neither the appellant's motion for nonsuit nor the order of dismissal was brought to the attention of the trial judge until after appellee had filed its answer and claim for affirmative relief. Consequently, we hold that appellee's answer and claim for affirmative relief was timely filed and that the court retained jurisdiction over both the parties and the subject matter of the litigation. It follows that the trial court did not err in setting aside the nonsuit and reinstating the cause, nor did the court err in consolidating appellants' subsequent action in trespass to try title with the original suit pending in the 162nd District Court. J. A. Walsh & Co. v. R. B. Butler, Inc., 260 S.W.2d 889 (Tex.Civ.App.--Waco 1953), writ dism'd, 152 Tex. 601, 262 S.W.2d 952 (1953).

Second, appellants contend that the court erred in granting a summary judgment because a fact question exists as to the amount of damages appellants sustained by the alleged wrongful appointment of a receiver. Appellants argue that the receiver was wrongfully appointed because the court failed to require and appellee failed to post an applicant's bond in connection with the appointment of a receiver. We overrule the contention. No appeal from the order was taken within the 20-day period required by Rule 385, Texas Rules of Civil Procedure, and as a result the order became final. The order having become final appellants are not permitted to collaterally attack the same on appeal. Any irregularity involved in the appointment, including the failure to post an applicant's bond, was waived. King Land & Cattle Corp. v. Fikes, 414 S.W.2d 521 (Tex.Civ.App.--Fort Worth 1967, writ ref'd n.r.e.); Archer v. Ross, 262 S.W.2d 213, 216 (Tex.Civ.App.--Fort Worth 1953, no writ).

Third, appellants contend that the trial court erred in granting appellee a summary judgment on their cross action in trespass to try title. In this connection appellants contend they had a right to title and possession of the premises in that the trustee's sale conducted by Franklin, the substitute trustee, was void because Diversified induced the original trustee, Layton, to resign without requesting him to sell the property. As we view the record the contention is without merit in that there is no summary judgment proof to support such contention. The proof shows that Diversified requested the original trustee, Layton, to sell the property but he refused on the ground that he was too busy with other matters. In his written resignation he stated that Diversified had 'requested' him to 'make the sale of the property' and that he declined to act as trustee and thereby resigned. The resignation was filed in the deed records of Dallas County. There is no evidence to the contrary. Since the summary judgment proof shows as a matter of law that appellee did not induce the original trustee to resign without requesting him to sell the property, the summary judgment proof establishes as a matter of law that there was no genuine issue of material fact upon appellants' theory of recovery in this regard.

Appellants further contend that the foreclosure sale by the substitute trustee, Franklin, was void because Franklin did not himself post the notices of sale. This contention is likewise without merit. The proof shows that the notices were properly posted by substitute trustee, Smith, who subsequently resigned...