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tin cans thrown into the depression at one is the enhancement of the value of the land time he visited it.
by reason of the improvements, and not the Seven or eight witnesses testified for the cost thereof, since it must be a benefit to the appellant with reference to the fence and its owner in enhanced value to estop him from condition, and three or four of them stated denying the right of defendant to compensathat Bemrod had paid them for hauling dirt tion for improvements. Sheffield v. Meyer for filling in the lot, which, it seems, extend- | (Tex. Civ. App.) 229 S. W. 614; Crump v, ed, in part, out into the lake. There is so Sanders (Tex. Civ. App.) 173 S. W. 559; much uncertainty in their evidence in regard Raley v. D. Sullivan & Co. (Tex. Civ. App.) to the dates when their work was done that, 159 S. W. 99. The facts show that plaintiff even if the act of Bemrod in filling in the attempted to acquire the land with the hope lot could be construed as an act indicating of perfecting title by the statute of limita. adverse hostile posession, we think the court tions, and therefore he did not act in such was justified in disregarding it. It was not good , faith as to entitle him to reimburseshown whether the sidewalk was constructed ment for the improvements he claims to have upon the lot or upon the street which be- made. Staley v. Stone, 41 Tex. Civ. App. 299, longed to the city, nor was it shown that 92 S. W. 1017. the construction of the sidewalk, even if We think a proper judgment has been enBemrod paid for it, was necessary to, or con- tered in the case. The judgment is therenected in any way with, his use of the lot. fore affirmed. The probative force of that fact is therefore negligible, save as it may tend to show a claim or ownership adverse to the record owner, If it be accepted for that purpose, it would prove that this claim was first as
HAINES v. BANKERS' PETROLEUM & RE
FINING CO. (No. 7362.) serted in 1916, less than 10 years before the institution of the suit. Even though it be (Court of Civil Appeals of Texas. San Antoadmitted that the lot was fenced for 10 years
nio. May 13, 1925. Rehearing Denied consecutively, this would not amount to ad
June 3, 1925.) verse possession, unless plaintiff was cultivating, using, or enjoying the lot for the 1. Appeal and error en 907 (2)-When agreefull term consecutively before the defend ment of facts does not contain finding of fact ants asserted their claim. Only a part of necessary to support judgment, presumed it had been cultivated for a few years.
that evidence supported judgment independWhile he had a warehouse upon the corner
ently of agreement. lot, which it seems was about 3 years, he
When the agreement of facts, which is filed stored crates and cartons from his saloon in lieu of a statement of facts, does not con
tain finding of fact necessary to support judgon a part of the lot occasionally. This would ment, it will be presumed that evidence supnot be such cultivating or using as would sat-ported judgment independently of such agreeisfy the requirements of the law that pos- ment. session of this character must be open, notorious, hostile, and peaceable, and, moreover, 2. Joint-stock companies and business trusts must be under a claim of right against the
Omol-Joint-stock association agreement held
not to constitute pure trust. true owner.  The burden rested upon the plaintiff
Joint-stock association agreement held not
to constitute pure trust, operated free from to show such possession, claim, and right as would satisfy the requirements of the law. any management of the directors, but to con
stitute a common-law agreement, controlled by The trial judge was not required to accept a board of directors. as true the evidence of plaintiff or any of his witnesses. and, because of its uncertain 3. Joint-stock companies and business trusts and indefinite character, we think he was 17-Petition of joint-stock association justified in disregarding it. Carlock v. Wil against officer and director, to recover money lard (Tex. Civ. App.) 149 S. W. 363; Buie v.
lost through his alleged fraud, held not subPenn (Tex. Civ. App.) 172 S. W. 547; Cline
ject to general demurrer. v. Booty (Tex. Civ. App.) 175 S. W. 1081; officer and director, who was also a stockhold.
Petition of joint-stock association against Houston Oil Co. of Texas v. Stepney (Tex. er, to recover money lost through his alleged Civ. App.) 187 S. W. 1078; Stringer v. John- fraud, held not subject to general demurrer. son (Tex. Civ. App.) 222 S. W. 267.
[6, 7] Plaintiff next complains of the fail. 4. Joint-stock companies and business trusts ure of the court to give him a judgment for
Om 17-Member of board of directors of the value of his improvements. This propo
joint-stock association, and officer thereof, sition is without merit. Plaintiff does not
occupied fiduciary position of trust, agency,
and confidence. allege that the improvements added anything
A member of board of directors of jointto the value of the land. The measure of stock association, and officer thereof, occupies recovery for improvements by the defendant fiduciary position of trust, agency, and confi
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
(273 S.W.) dence, and, where intrusted with management such circumstances as made the loss a fraud and control, must discharge his duties with the on the association, held not entitled to apporutmost care and good faith.
tion or qualify his wrong. 5. Joint-stock companies and business trusts 17-Rule that action at law against part
Appeal from District Court, Tarrant Counnership does not lie without previous ac ty; Ben M. Terrell, Judge. counting held not applicable in suit by joint Suit by the Bankers' Petroleum & Retin. stock association against its director and of. ing Company against L. B. Haines. Judgficer, for his alleged fraud.
ment for plaintiff, and defendant appeals. Rule that action at law, by one partner Affirmed. against another, does not lie without previous accounting, held not applicable in suit by joint
John W. Wray, Max K. Mayer, and E. L. stock association against its director and offi. Gilbert, all of Fort Worth, for appellant. cer, to recover money lost through his fraudu Smith & Smith and Jonas Kizer, all of lent and tortious acts.
Fort Worth, for appellee. 6. Joint-stock companies and business trusts Om 17-Right of joint-stock association to
COBBS, J. Appellee, a joint-stock associasue its director and officer for torts and fraud tion, sued appellant, stockholder and officer held not dependent upon prior accounting therein, for the recovery of the sum of $3,and dissolution of association.
301.85, being a balance due on the sale of cerWhere a joint-stock association suffered pe- tain refined and petroleum products made by cuniary losses through the tortious acts and him to the Associated Producing & Refining fraud of its director and officer, it was not nec- Company and never accounted for, and for essary, as a condition to suing the director to the further sum, denominated “lease money,” recover such losses, that an accounting be first growing out of the leasing of a certain rehad and the association dissolved.
finery alleged to have been sold by appellee 7. Joint-stock companies and business trusts to the Associated Producing & Refining CorOm 17-Evidence held to show want of care poration, who, after the purchase, and while and fraud of director and officer of joint in the possession of the property, leased the stock association resulted in damages to lat- refinery for the period of 4 months to the ter.
Texahoma Company. There was an acceleraEvidence held to show want of care and tion clause in the transfer papers from apfraud of director and officer of joint-stock association resulting in damage to the association pellee to said company, and the proposed within Rev. St. 1911, art. 1985.
lessee, Texahoma Company, refused to ac
cept the lease unless appellee would agree 8. Appeal and error Cowo 1026 – Matters not that during the period of the lease to the hurtful will not be considered reversible.
Texahoma Company it would not take adMatters not shown to be hurtful will not be vantage of the acceleration clause to foreconsidered reversible.
close on the property. Appellant agreed 9. Joint-stock companies and business trusts thereto, and because of such agreement the
fm 17--Director and officer of joint-stock as- $8,000 was lost to appellee through the fault sociation held liable in damages to associa- and neglect of appellant. tion, resulting proximately from his act or The cause was tried with a jury upon speomission of duty, inconsistent with good cial issues, and, in accordance with the anfaith,
swers thereto, judgment was rendered in faDirector and officer of joint-stock associa
vor of appellee against appellant for the sum tion, to whom had been intrusted the manage- of $11,301.85, with 6 per cent. interest from ment and control of association's financial affairs, held liable in damages to association re
date of judgment. sulting proximately from his acts or omissions,
[1, 2] Under an agreement of facts filed in inconsistent with good faith.
lieu of a statement of facts, between the par
ties, we are not permitted to consider any 10. Joint-stock companies and business trusts question in the case not embraced therein.
w 17-Duty of director and officer, intrusted However, when there is any finding of fact with management of joint-stock association, to obey instructions of board of directors.
necessary to support the judgment not in the It is the duty of a director and officer, in- agreement, we will presume there was testrusted with management of joint-stock associ- timony sufficient, independent of the agreeation, to obey instructions of board of directors ment, to support the judgment. At the very in regard to management and distribution of outset we will say that this joint-stock asassociation property and collection of moneys sociation agreement does not constitute a
pure trust, operated free from any manage11. Joint-stock companies and business trusts ment of the directors, but does constitute a Emo 17-Director and officer of joint-stock as
common-law agreement, controlled by a board sociation, guilty of fraud towards it, held not of directors. Sometimes such associations entitled to apportion or qualify his wrong.
are called partnerships. See Cattle Raisers' Director and officer of joint-stock associa- Loan Co. et al. v. Sutton, 271 S. W, 233, an tion, who lost money for the association under opinion by this court.
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
 We overrule appellant's first assign-, in Texas, proposed, through appellant, to ment of error, complaining that the court purchase from appellee its refinery, and aperred in not sustaining appellant's general pellee delegated appellant to make an investidemurrer, The petition stated a good cause gation; whereupon thereafter appellant recof action.
ommended the sale on the terms proposed, We overrule the second assignment of er- which were no cash but the promise to pay ror, complaining of the refusal of the court $135,000, to be evidenced by the notes of the to instruct a verdict for appellant. In this said Associated Corporation to appellee, paythe court did not err.
able in installments of $12,000 each 6 months, We overrule the third assignment of error, all to be paid in 18 months, and to be secured claiming that the trust agreement itself ex- by vendor's lien and deed of trust upon the empted the shareholders from personal lia- refinery, and by pledge and delivery to the bility as between themselves, because each appellee $67,500 par value of the Associated shareholder of the organization and each Corporation's first mortgage, 8 per cent. gold member thereof so understood it, and was bonds, and by the acceleration clause that, also charged with knowledge of the contents in the event of default in any payment when of the declaration of the trust which created due, the whole indebtedness would, at the opthe exemption, hence the court was without tion of the holder of the note, mature. power, under such circumstances, to render All the matters in respect to the sale and any judgment against the appellant in the collection of the money and management absence, first, of an accounting to show lia- thereof were placed with, and left completebility, and that therefore there was and is ly in the hands of, appellant to care for, for a complete defense against the cause of ac- the benefit of appellee. He was to collect tion, and by holding to the contrary it is all moneys, notes, etc., and sell to the best contended the court committed error. This advantage the refined products, and generalassignment seems somewhat involved and ly preserve the interests of the company. really "hoists appellant on its own petard," Without the knowledge of appellee, or its in that it says the trust agreement entirely consent, appellant became interested in the exempts him from such a suit, then, in effect, said Associated Corporation, and became a says such a liability might be created by an stockholder therein; and, while so interestaccounting.
ed, appellant delivered to the said AssociatThe fourth and fifth and all the assigned Corporation the refined products belongments are practically to the same effect, ing to appellee, of the reasonable market valgrounding the defense upon the severalue of not less than $5,301.85. Appellant drew grounds: (1) That there can
suit a draft in the name of appellee, by himself against appellant to recover against him at as president, on the said Associated Corpoall; (2) that there can be maintained no suit ration, at St. Louis, Mo., for $5,301.85, and against him until after an accounting; and deposited it as a cash item in the bank at (3) that there can be no suit maintained | Wichita Falls, Tex., with which bank appelagainst him at all upon a tort.
lee did business, and it was placed to the  From the beginning appellant occupied credit of appellee on the books of said bank. a fiduciary position of trust, agency, and The draft was not paid but in due course confidence, as he was a member of the board dishonored. Appellant knew the facts, and of directors of the association, and at the at the meeting of January 9, 1922, was elesame time was its secretary and treasurer, vated from the position of secretary and and on January 9, 1922, became its president treasurer to that of president and treasurer and treasurer. He drew, by express author of Bankers' Petroleum & Refining Company; ity of the board, and was paid, a salary of and he did not make known, as it was his $300 per month, as secretary and treasurer: duty to do, the dishonor of the draft, but lle paid himself out of the funds of the com- approved at such meeting an audit of the pany without authority $200 per month, as company's affairs to December 31, 1921, president and treasurer. His drafts on the showing cash on hand, inclusive of the $5,funds of that company during that period of 301.85; and falsity of the statement and time were without signature of any other audit was not made known to appellee until member but himself.
its meeting in April, 1923. By October 1, 1921, the company had By January 9, 1922, appellant had become amassed considerable assets, and at that time a large stockholder in the said Associated was the owner of a refinery in Wichita coun- Corporation and a director and employee, ty, Tex., together with certain refined prod- and was familiar with, and had knowledge ucts consisting of gasoline, kerosene, and fuel of, the affairs and financial standing of the oil. Also the owner of bills and accounts re- said Associated Corporation. On that day ceivable, aggregating on their face $3,500, the said Associated Corporation leased the and a bank account of about $25,000. refinery to the Texahoma Oil Company for
The Associated Producing & Refining Cor- the period of 4 months, for a rental of $8,poration, organized under the laws of Dela- 000, payable in cash in advance. During the ware, never having a permit to do business negotiations, the Texahoma Company discov
(273 S.W.) ered the appellee's lien on the refinery and distinct, and ascertainable without any acdemanded, as a condition precedent, that ap- counting. pellee consent to the lease, which it refused This suit is not to be treated as one of to do, and instructed appellant not to consent contribution by one partner against another. thereto without the payment to him for the He is not called upon to pay an indebtedness account of appellee to be applied on the note against a partnership, but is called upon of the said Associated Corporation, the sum alone to make good his tortious acts and of $8,000 rental, which appellant agreed to fraud in which no other member participatdo. Notwithstanding the instructions to the ed. This was his wrong, and he alone can contrary, the appellant permitted the rental be called upon to rectify it, because it was to be paid to the said Associated Corpora- his own misconduct and individual bad faith tion instead of to the appellee, and no part and fraud perpetrated upon his associates, thereof has ever been paid to or received by to which no other was a participant or liable appellee.
at all. No good result would be attained here At the time of the lease, appellee held the in requiring appellee to file proceedings for advantage that only $4,000 had been paid on an accounting or for a receivership to try the note secured by a lien on the refinery issues undisputed that have already been and bonds which were then subject to fore-tried. Victor Refining Co. v. Bank (Tex, Civ. closure. By the exercise of reasonable care | App.) 263 S. W. 622. and diligence and effort the appellant was A joint-stock association is now an instiin a position to have collected for appellee, tution quite as well known and understood in and applied on the note, the full rental of the business world as a partnership, con$8,000. Appellee, trusting appellant, did not cerning liability of its members to third pardiscover the dereliction of appellant, and ties or in respect to their mutual rights, duthat the rental on the lease had not been ties, and liabilities to each other. The reapaid prior to the meeting at Wichita Falls son of the rule that an action of law by a on April 9, 1923, and that the money was partnership against one of its members will paid to the said Associated Corporation in- not lie without a previous accounting among stead of to appellee. By reason of the neg- its members does not exist in this case. lect and want of care and attention to these Worley y, Smith, 26 Tex. Civ. App. 270, 63 matters, the appellee lost its debts, and the S. W. 903; 20 R. O. L. 1076, 1078. said Associated Corporation became a bank Even in a partnership matter one partner rupt. Appellant neglected and failed to call may maintain his action against his partners meetings of the board of directors, to give for damages arising from an injury caused notice and make reports of his acts and do- to the business by the dishonest practice of ings in the matters intrusted to him, by rea- a copartner, resulting from his gross neglison of which misconduct, neglect, and want gence, unskillfulness, fraud, or wanton misof care appellee lost its debt. The said As- conduct. sociated Corporation became hopelessly in  There was evidence to show, and it solvent and unable to pay any of its indebt- was in the jurisdiction of the court to find edness.
from the evidence before it, and as the court Special issues were submitted to the jury, has done, that the negligence, want of care, and every issue of fact was found in favor of and fraud on the part of appellant (also appellee.
found by the jury) resulted in the damage [5, 6] It is true, as a general rule, that no to appellee in the amount of the judgment. suit can be maintained by one partner The testimony is very full that the loss ocagainst another partner until the partnership curred by reason of the negligence, want of is wound up, or until after an accounting care, and fraud of appellant. Article 1985, has been had, but that rule is not applicable R. C. S. 1911. here. This is a suit by the company itself to  In regard to the charges of the court, compel the member who has committed tort we think all the issues were fairly submitted La wrong-to account for his mala fides. It and covered the case. If any matters were is not necessary to primarily have either an immaterial and irrelevant, they have not accounting or à dissolution of the partner- been shown to be hurtful, and will not be ship before a suit can be brought on a tort considered as reversible error, Appellant such as this. The alleged agreement against did not object to the failure of the court to personal suits, which attempts to relieve submit additional issues, and no specific mamembers from any judgment or recovery, terial issues were requested by appellant and has no application to the tortious acts and refused. wrongs that members perpetrate upon the [9-11] Under this trust agreement the manassociation itself. Just as well say, in a agement and control of the company's afcase of theft or embezzlement of the associa- fairs were placed in the hands of seven dition's funds, the association is helpless to pro- rectors, but, by the action of the board of tect itself without first dissolving the corpo- ! directors themselves, the possession and conration, which the members desire to continue trol of its financial affairs were placed unin business. The demand here is specific and der the management and sole control of ap
pellant, one of its members, who was at dif-, tual possession of well, casings, and fixtures, ferent times the secretary, treasurer, and and was using gas production therefrom, defendpresident. He owed to the directors and his ant was not an innocent purchaser. company, in such agency and trust capacity, the utmost care and good faith. Therefore,
Appeal from District Court, Erath County; as a proximate result of any act or omission J. B. Keith, Judge. on the part of appellant, inconsistent with Suit by the Orfic Gasoline Production Comgood faith, causing appellee to be damaged, pany against S. C. Herring to restrain dehe is answerable in damages therefor. It fendant from pulling casing out of gas well, was his duty to obey the instructions given and to quiet title therein in plaintiff. Judghim in regard to the management and dis- ment was entered en joining defendants from position of the property and collection of the removing casing or fixtures while well is promoneys due the appellee. Instead of that he ducer, but defendant was given title to casdealt with the said Associated Corporation, ings and fixtures, with right to remove them and failed to collect the moneys from it, and when well ceased to be producer, and plain. became a stockholder and officer in that com- tiff appeals. Reversed and rendered in part, pany antagonistic to the interest of appel- and affirmed in part. lee, and lost all the money it owed appellee,
Allen K. Swann, of Tulsa, Okl., and Oxunder such circ mstances as made it a fraud ford & Johnson, of Stephenville, for appelupon the part of appellant. He cannot be
lant. heard to apportion or qualify his wrong.
Smith & Birge, of Desdemona, and R. L. We have carefully considered appellant's Thompson, of Stephenville, for appellee. brief, all assignments of error and propositions, and find no reversible error assigned. The judgment of the trial court is affirmed.
BARCUS, J. This suit was instituted by appellant, seeking an injunction to restrain appellee from pulling the casing out of a gas well and appropriating same, and to quiet title in appellant to the casing and fixtures in
and connected with said well. ORFIC GASOLINE PRODUCTION CO, v. HERRING. (No. 240.)
In 1918, Joseph Terry and others executed
an oil and gas lease contract to J. A. Mercer (Court of Civil Appeals of Texas. Waco. to 160 acres of land in Erath county. The May 28, 1925.)
lease provides that it shall remain in force 1. Fixtures w15--Casings, derricks, and ma
for a term of two years from its date, Sepchinery placed on land by lessee do not be. tember 3, 1918, and as long thereafter as oil come part of realty.
or gas, or either of them, is produced from Where lessee, in seeking to explore for oil said land by lessee. It further provides that and gas, places casing in well and erects der- the lessor is to have one-eighth of the oil and ricks and machinery, it does not become part $200 a year for each gas well, and provides of realty.
that lessee shall have the right at any time 2. Fixtures Cw32—Neither owner of well nor to remove all machinery and fixtures placed
owner of land can withdraw well casing so on said premises, including the right to draw long as well is producer.
and remove casing. The lease on 15 acres of As long as a well is a producer, neither own the tract was transferred to the Jasamine er of land nor owner of well can withdraw cas Oil & Production Company, which drilled ings and thereby destroy well.
a well, and used in the drilling thereof the 3. Fixtures Cw32—Lessee, owning casings and casing and other fixtures involved in this
fixtures, may remove them after producing litigation. The well was dug to about 3,000 well becomes a nonproducer.
feet in March, 1920, and proved to be a gas Where a well is a producer and thereafter well, and same has been a producer of gas becomes a nonproducer, lessee, who owns cas
from said time to the date of trial. After ing and fixtures, may within a reasonable time the well was brought in, the Jasamine Oil & remove them.
Production Company sold the well, its pro4. Mines and minerals Ow74-Sale of oil and duction and all of the casing, derrick, and fir
gas lease does not convey interest in well tures, to W. A. Letson, in May, 1920, and by a casings or fixtures.
regular chain of sales same were conveyed to Sale of oil and gas lease does not convey appellant in August, 1921. Gas was used in any interest in, or to casings in well, or fixtures small quantities from the well from the time used in connection therewith.
it came in until November, 1921, when the 5. Sales Om235 (2)-One purchasing oil well production was materially increased, and be
casings and fixtures from landowner, while ginning with November, 1921, the owners of another was in actual possession and control, the royalty for the first time obtained payheld not an innocent purchaser.
ments thereon. After the Jasamine Oil & Where, at time defendant purchased well Production Company sold the well to Letson, casings from owner of land, plaintiff was in ac- they abandoned their claim in the balance of
For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes