Matrix, Inc. v. Provident American Ins. Co.
| Decision Date | 30 June 1983 |
| Docket Number | No. 05-83-00205-CV,05-83-00205-CV |
| Citation | 658 S.W.2d 665 |
| Parties | MATRIX, INC., Appellant, v. PROVIDENT AMERICAN INSURANCE CO., et al., Appellee. |
| Court | Texas Court of Appeals |
Timothy A. Duffy, Hughes & Hill, Dallas, for appellant.
Jeff Joyce, Winstead, McGuire, Sechrest & Minick, Dallas, for appellee.
Before AKIN, STEPHENS and STEWART, JJ.
This case of first impression challenges the authority of a trial judge to order the sale of a promissory note, under the provisions of Tex.Rev.Civ.Stat.Ann. art. 3827a (Vernon Supp. 1982-1983), to aid a judgment creditor in collection of its judgment. We conclude that article 3827a does grant such authority; consequently, we affirm.
Provident American Insurance Company obtained a judgment against Matrix, Inc. for $478,599.27. On application by Provident for a turn-over order pursuant to article 3827a, the district court ordered Matrix, Inc., the judgment debtor, to turn over and deliver four promissory notes to the Dallas County District Clerk, and ordered the Clerk to hold the notes pending a hearing as to their final disposition. After hearing, the court ordered the District Clerk to deliver one of the notes, in the principal amount of $1,076,146.00, to a certain named Dallas County deputy sheriff, or any other duly authorized deputy sheriff. The court further ordered Matrix, Inc. to turn over to the sheriff's department true and legible copies of documents evidencing or relating to any and all payments made by the maker of the note, granted Provident and other potential buyers of the note the right of inspection of all documents, and authorized the sheriff to sell the note pursuant to the provisions of Texas law.
Appellant, in six grounds of error, argues (1) that the turn over order is improper because a note is not property subject to levy or execution; (2) that the note is incapable of present valuation and is not evidence of an obligation presently due; (3) that Provident failed to meet its burden of establishing its present value; (4) that Provident failed to prove that the underlying judgment remained unsatisfied and unpaid; (5) that garnishment is the exclusive remedy for Provident to reach the note in question; and (6) that the evidence established that the maker of the note was entitled to set off in excess of the stated amount of the note.
The principal question is the power of the trial court to order a promissory note sold under article 3827a, we will address each of Matrix's points.
Matrix contends that the note is incapable of present evaluation and is not evidence of an obligation presently due. We disagree. First, the parties agreed during oral argument that the note in question is a demand note. Consequently, the holder of the note may declare it due at his will. See Davis v. Dennis, 448 S.W.2d 495, 497 (Tex.Civ.App.--Tyler 1969, no writ). Once the holder declares the note due and payable, the documents evidencing records of all payments made on the note, which have been ordered delivered to the sheriff, will provide the necessary information to calculate the sum due.
Matrix also argues that Provident failed to meet its burden of proving present value of the note. This argument is without merit. Present value of the note is of no consequence; the price paid by the purchaser at the sheriff's sale is the value which will be credited to the judgment.
Next, Matrix argues that Provident failed to prove that the judgment remained unsatisfied. We construe this argument to be that all or a portion of the judgment had been paid. Matrix did not answer Provident's suit for turnover, nor did it plead payment as an affirmative defense, as required by Tex.R.Civ.P. 94. Thus it is precluded from raising that contention on appeal.
Matrix also argues that garnishment is the exclusive remedy for collection of the note. We disagree. We hold article 3827a to be cumulative of other lawful remedies available to Provident for collection of its judgment.
The contention is made that certain set-offs due the maker of the note from Matrix were conclusively established in an amount in excess of the face of the note. However, offset is an affirmative defense which must be pled and proven. Tex.R.Civ.P. 94; Brown v. American Transfer & Storage Co., 601 S.W.2d 931 (Tex.1980), cert. denied, 449 U.S. 1015, 101 S.Ct. 575, 66 L.Ed.2d 474 (1980). Since no offset was pled or proven in the trial court, this point of error is overruled.
Point of error number one contains the crucial issue in this case. The thrust of appellant's argument is that the legislative intent, by enactment of article 3827a, was to grant a judgment creditor court assistance to require an evasive debtor to deliver property, otherwise subject to execution, to a sheriff for sale as otherwise provided by law, and was not intended to expand the type of property which could be sold by the sheriff at an execution sale. In light of this contention, Matrix argues that a promissory note is not property subject to execution sale, citing Sheldon v. Stagg, 169 S.W.2d 550 () as its authority. In Sheldon the sheriff levied on a promissory note which had been entrusted to a third person pending the closing of a real estate sale, at which time that person would be empowered to deliver the note to the payee. The court held that absent delivery of the promissory note to the payee, the note was not a valid obligation and was unenforceable against the maker, thus not subject to execution. However, Sheldon does not support the contention that a negotiable promissory note, regular on its face, once in the hands of a sheriff, is not subject to an execution sale in satisfaction of a judgment.
We next look to the statute to determine the underlying legislative intent. In construing statutes, the canons of construction are merely tools to aid in ascertaining...
To continue reading
Request your trial
-
Schueler v. Rayjas Enterprises, Inc.
...(an attorney) to satisfy a judgment for the attorney's fees awarded her in the divorce case. Likewise, in Matrix, Inc. v. Provident American Insurance Co., 658 S.W.2d 665 (1983), a promissory note payable to the debtor and in the hands of the debtor was ordered turned over to the sheriff fo......
-
Cohen v. The Palestinian Auth.
...Supply Co., 650 S.W.2d 547, 549 (Tex.App.-Houston [14th Dist.] 1983, writ ref'd n.r.e.); and promissory notes, Matrix, Inc. v. Provident Am. Ins. Co., 658 S.W.2d 665, 668 (Tex.App.-Dallas 1983, no writ).”)(alteration in original). The Elkhart court also acknowledged the contrary authority o......
-
Hunt v. Baldwin
...debtor's property; instead, the debtor is only entitled to the actual purchase price credited to the judgment. See Matrix, Inc. v. Provident Am. Ins. Co., 658 S.W.2d 665, 666 1983, no writ) (holding present value of note was of no consequence because price paid by purchaser at sheriff's sal......
-
Dallas County v. Sweitzer
...1985, writ ref'd n.r.e.). When the wording of a statute is ambiguous, we consult statutory construction rules. See Matrix, Inc. v. Provident Am. Ins. Co., 658 S.W.2d 665, 667 (Tex.App.--Dallas 1983, no We review an act as a whole. We do not give a statute a meaning that conflicts with other......