Tackett v. Mid-Continent Refrigerator Co., MID-CONTINENT

• Citation: 26 U.C.C.Rep. 764,579 S.W.2d 545
• Decision Date: 22 March 1979
• Docket Number: No. 18080,MID-CONTINENT,18080
• Parties: 26 UCC Rep.Serv. 764 Paul E. TACKETT, Appellant, v.REFRIGERATOR COMPANY, Appellee.
• Court: Texas Court of Appeals

Page 545

579 S.W.2d 545

26 UCC Rep.Serv. 764

Paul E. TACKETT, Appellant, v. MID-CONTINENT REFRIGERATOR COMPANY, Appellee.

No. 18080.

Court of Civil Appeals of Texas, Fort Worth.

March 22, 1979.

Rehearing Denied April 19, 1979.

Senterfitt, Adams, Miller & Childress, and Richard T. Miller, San Saba, for appellant.

Martin & Millican, Michael M. Martin, Lampasas, for appellee.

OPINION

SPURLOCK, Justice.

This is an appeal from a directed verdict against a lessee for rent owed and accelerated under a lease agreement after the lessee defaulted.

Paul Tackett, the lessee, acquired a refrigerator from Mid-Continent Refrigerator Company by executing a contract which Mid-Continent claims is a lease agreement, and which Tackett claims is a purchase money security interest. After a dispute over some payments Tackett stopped making the payments required under the contract and Mid-Continent repossessed the refrigerator. Lessee Tackett appealed from the judgment.

We reverse and render.

The contract provided that if Tackett defaulted, Mid-Continent could accelerate the payments and declare the entire amount of the rent immediately due and payable. Mid-Continent accelerated the rent payments and sued Tackett for the rent in arrears plus the amount accelerated, the interest thereon until judgment, costs of repossession of the refrigerator, and attorney's fees.

Mid-Continent claims this court has no jurisdiction to hear Tackett's appeal because he failed to timely file his record. The appeal was originally filed in the Court of Civil Appeals for the Third Supreme Judicial District of Texas sitting in Austin. It was transferred to this Court by order of the Supreme Court of Texas. Therefore, we must determine this question according to the record as it appears in this Court.

The record indicates Tackett filed a motion for new trial in the trial court on November 18, 1977. Both parties agree that the forty-fifth day after the motion was filed was January 2, 1978. Mid-Continent claims the motion was overruled by operation of law on January 2, 1978 under Rule 329b(3) ¹ and therefore, March 3, 1978 was the last day on which Tackett's transcript could have been timely filed under Rule 386. The envelope containing his transcript and made a part thereof was post marked on March 4, 1978 and filed by the Clerk of the Third Court of Civil Appeals on March 8, 1978.

Tackett claims that although January 2, 1978 was the forty-fifth day under Rule 329b(3), it was a legal holiday in 1978. Mid-Continent responds that only the days listed in Art. 4591 ² are legal holidays for purposes of Rule 4 which governs calculation of time limits found in the rules. It cites Smith v. Harris County-Houston Ship Chan. Nav. Dist., 160 Tex. 292, 329 S.W.2d 845 (1959) for this proposition. While we accept this proposition as true, the Supreme Court in Smith certainly did not decide that the legislature could not declare additional days as holidays.

The Texas legislature in 2 General and Special Laws of the State of Texas, Ch. 872 at 3145 (1977), declared January 2, 1978, a holiday for state employees. January 1 was on a Sunday in 1978. Although January 2 was not declared to be a "legal" holiday, state offices were closed just as if it had been a legal holiday. In our opinion the legislature's declaration that January 2, 1978 was a holiday for state employees was intended to apply to Rule 4. Therefore, Tackett's motion for new trial was overruled by operation of law on January 3, 1978. His sixty days to file his transcript began to run on January 4, 1978. The sixty day period expired on Saturday, March 4. Thus, under Rule 4 the last day which Tackett could have timely filed his transcript was March 6, 1978. Although the Clerk of the Third Court of Civil Appeals filed the transcript on March 8, the postmark on the envelope containing the transcript is March 4, 1978. Therefore, under Rule 5 Tackett timely filed his record. The Third Court of Civil Appeals correctly overruled Mid-Continent's motion to dismiss Tackett's appeal and we overrule this contention of Mid-Continent.

Mid-Continent relies solely on its contention that the transcript was not timely filed. It did not respond to Tackett's points of error with reply points, counter-points, or cross-points of error. However, since there is the general presumption that the judgment is correct, we must consider Tackett's points of error to determine if they have merit, albeit without the benefit of argument from Mid-Continent.

Tackett contends the contract with Mid-Continent is a security interest rather than a mere lease. He claims the contract is one for a security interest as a matter of law under § 1.201(37) (Supp.1978) ³ because the shipping order he signed upon receipt of the refrigerator gave him the option to acquire title to the unit with the payment of no additional consideration. He was required to pay only the sales tax upon the expiration of the contract. § 1.201(37) provides in pertinent part as follows:

" 'Security interest' means an interest in personal property or fixtures which secures payment or performance of an obligation . . . Whether a lease is intended as security is to be determined by the facts of each case; however, . . . (B) an agreement that upon compliance with the terms of the lease the lessee shall become or has the option to become the owner of the property for no additional consideration or for a nominal consideration does make the lease one intended for security."

This provision was construed by the Court of Civil Appeals in Davis Brothers v. Misco Leasing, Inc., 508 S.W.2d 908 (Tex.Civ.App. Amarillo 1974, no writ). In a well reasoned opinion the Court adopted two tests to determine whether a lessee has the option to acquire title to the property for no additional consideration or for a nominal consideration under § 1.201(37). We agree that the best test is a comparison of the fair market value of the property at the time the option is exercisable with the option price. Another test is whether the terms of the option leave the lessee with no sensible...