Magnum Mach. & Tool Corp. v. 1st Nat. Bank of Seguin

Decision Date23 December 1976
Docket NumberNo. 4971,4971
Citation545 S.W.2d 549
PartiesMAGNUM MACHINE & TOOL CORP., Appellant, v. 1ST NATIONAL BANK OF SEGUIN et al., Appellees.
CourtTexas Court of Appeals

Ted R. Cackowski, Austin, for appellant.

Thomas R. Crump, Seguin, for appellees.

McCLOUD, Chief Justice.

This is an appeal from an order denying a temporary injunction. The appellees neither filed a brief nor appeared for oral argument. Plaintiff, Magnum Machine and Tool Corporation, sought a temporary injunction enjoining defendants, First National Bank of Seguin and C . H. Donegan, Jr., from selling property of plaintiff under the provisions of a deed of trust. The trial court denied the motion for temporary injunction and plaintiff, Magnum Machine and Tool Corporation, has appealed. We affirm.

On August 1, 1973, Vahlco Corporation executed a Real Estate Lien Note in the principal amount of $10,000 payable to the First National Bank of Seguin. To secure the note, Vahlco executed a deed of trust in favor of the bank which designated C. H. Donegan, Jr., as trustee. The deed of trust covered real estate which was later transferred by Vahlco to plaintiff. The deed provided that the conveyance was made subject to the deed of trust in favor of the bank. The deed of trust contained a 'dragnet' clause purporting to secure further advances:

'It being contemplated that from time to time Grantor will become further indebted to said Bank, this Deed of Trust and the lien created hereby shall secure any and all indebtedness of Grantor to said Bank of every nature whatsoever, whether created heretofore or hereafter, primary or secondary, until such indebtednesses are fully paid and until this Deed of Trust is duly released by said Bank, and the mere fact of repayment of all indebtedness of Grantor shall not terminate this Deed of Trust lien unless the same be so released by said Bank at the request of Grantor, otherwise it shall remain in full force and effect to secure all present and future indebtednesses of Grantor to said Bank, however the same may be evidenced. This Deed of Trust and lien shall not affect or be affected by any additional security that may be taken as to any indebtedness due said Bank by Grantor and shall not be affected by renewals or extensions of all or any part thereof, or by partial releases of any character whatsoever . . .'

On December 10, 1973, Vahlco executed a note in the principal sum of $350,000 payable to the First National Bank of Seguin. This note recited on its face it was secured by inventory, retainages, and a 'S.B.A. guarantee'. The 'S.B.A. guarantee' referred to a guarantee by the Small Business Administration. This was the only Small Business Administration guaranteed loan that Vehlco obtained through the First National Bank of Seguin. On February 12, 1976, plaintiff paid the bank $5,368.33 which was the balance owed on the August 1, 1973, note. The $350,000 note was in default and is listed in the trustee's notice of sale. Plaintiff contends the deed of trust did not secure the $350,000 note.

The court in Texas Foundries v. International Moulders & Foundry Workers' Union, 151 Tex. 239, 248 S.W.2d 460 (1952) stated:

'. . . The granting or refusing of a temporary injunction is subject to a very different character of appellate review from the granting or refusing of a permanent injunction. The trial court is clothed with broad discretion in determining whether or not to issue a temporary injunction to preserve the rights of the parties pending a final trial of the case, and when that discretion is exercised its order should not be overturned unless the record discloses a clear abuse of discretion . . .'

The rules applicable to temporary injunction cases were discussed in Sun Oil Company v. Whitaker, 424 S.W.2d 216 (Tex.1968):

'. . . To warrant issuance of the writ, an applicant is not required to establish that he will prevail on final trial; he needs only to plead a cause of action and to show a probable right on final trial to the relief he seeks and probable injury in the interim. Transport Co. of Texas v. Robertson Transports, Inc., 152 Tex. 551, 261 S.W.2d 549 (1953); Southwestern Greyhound Lines, Inc. v. Railroad Commission of Texas, 128 Tex. 560, 99 S.W.2d 263, 109 A.L.R. 1235 (1936). To be entitled to the writ when the only relief sought on...

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2 cases
  • In re Trinity Meadows Raceway, Inc.
    • United States
    • U.S. Bankruptcy Court — Northern District of Texas
    • September 12, 2000
    ...Meadows after they became the owner of the Notes and Security Documents and pursuant to their terms. See Magnum Machine & Tool Corp. v. First Nat'l Bank, 545 S.W.2d 549, 550 (Tex.App.1976, no writ) ("The facts in Moss and Wood are distinguishable. Both cases dealt with claims purchased or o......
  • Wagner v. Compass Bank
    • United States
    • Texas Supreme Court
    • August 16, 2005
    ...agreement to reference the prior pledged collateral for the future advance clause to apply. See Magnum Machine & Tool Corp. v. 1st Nat'l Bank of Seaguin, 545 S.W.2d 549, 551 (Tex.Civ.App.-Eastland 1976, no writ). In Magnum, Vahlco Corporation executed a real estate lien note payable to the ......

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