CITY OF CORPUS CHRISTI, Appellant, v. A. W. GREGG et al., Appellees.
No. 12716.
Court of Civil Appeals of Texas, San Antonio.
Nov. 24, 1954.
Rehearing Denied Jan. 19, 1955. Further Rehearing Denied Feb. 16, 1955.
The plain and unequivocal testimony of Mr. Dubose showed conclusively that plaintiffs had not claimed the land in controversy for ten years. The deed to the railway company conveyed the land, not a mere easement. It is, therefore, evident plaintiffs were not entitled to recover on either of the theories on which they relied.
The judgment is affirmed.
See also, Tex.Civ.App., 267 S.W.2d 478.
Dan Moody, Dan Moody, Jr., Austin, B. D. Tarlton, Corpus Christi, C. E. Bryson, Houston, John Miller, Sinton, Wm. E. Nichols, Aransas Pass, J. C. Tenrus, William B. Moss, Sinton, Lewright, Dyer, Sorrell & Redford, Corpus Christi, for appellees.
NORVELL, Justice.
This suit was brought by A. W. Gregg to validate four oil and gas leases held by him and purportedly executed for and on behalf of the City of Corpus Christi. By way of cross-complaint, the City sought a decree cancelling the leases and named A. W. Gregg, Sam Susser and Leslie Wasserman as cross-defendants. Upon motion, Wasserman was dismissed from the suit over the City‘s objections.1 At the
conclusion of the evidence, the court instructed the jury to return a verdict in favor of Gregg and Susser, whereupon judgment was rendered validating the four oil and gas leases in question and decreeing that the City take nothing against Gregg and Susser.
The City by its first point urges that the evidence was sufficient to take the case to the jury upon the pleaded theory that Gregg had obtained the oil and gas leases by fraud. It is specifically contended that the evidence if credited was sufficient to show that Gregg had paid some $30,000.00 to Wasserman, who was Mayor of the City of Corpus Christi, and that such sum was paid for Wasserman‘s corrupt services in influencing the action of the city council in executing the leases.
It appears that Gregg had known Susser for some time prior to December, 1949, and that the two had been jointly interested in certain oil and gas operations in West Texas. Largely at the instigation of Susser, Gregg decided to investigate oil and gas production opportunities in the Corpus Christi area and entered into an agreement with Susser that should any leasehold interests be acquired they would be held jointly, Gregg owning a two-thirds interest and Susser a one-third interest therein. Gregg came to Corpus Christi some time during the month of December, 1949, and became acquainted with Leslie Wasserman, the Mayor of Corpus Christi, who was a friend of Susser‘s for many years. Wasserman was then engaged in the upgrading of Mexican cotton, that is, mixing domestic cotton with that which he had imported and selling the combined product. He applied to Gregg for a loan of $20,000.00 and represented that he expected to make a $30,000.00 profit in his cotton activities. Gregg did not loan this money to Wasserman direct, but on January 4, 1950, he signed a note which was also executed by Wasserman and his wife, for the principal sum of $20,000.00, payable to the order of the City National Bank of Houston. Wasserman received the proceeds of this note,
During the month of January, 1950, there was drilling activity on a lease adjacent to certain property owned by the City of Corpus Christi, near Mathis, Texas, where the City maintained a storage reservoir as a part of its water works system. The well then being drilled near the City‘s property was known as the Ella Wade No. One. Susser attempted to get information in regard to this well and by entering upon the premises with city employees who were entitled to go upon the Wade property, he managed to see the record of the Schlumberger test. The showing of the Ella Wade was favorable, and a lease upon the adjoining property owned by the City of Corpus Christi thereupon became highly desirable. On January 14, 1950, the Manager of the City of Corpus Christi advised that bids for an oil and gas lease upon property owned by the City of Corpus Christi near the Ella Wade lease would be considered. The time limit for the receiving of bids was set at 5 o‘clock P.M. on January 19th. The Ella Wade was completed as a producer on the fifteenth and fourteen bids for an oil and gas lease upon the city property were received by the nineteenth. No paid advertisements were inserted in newspapers with reference to the call for bids, but wide publicity was given to the proposed letting of a lease by the Corpus Christi daily papers. The various bids received were discussed by the city commissioners
It appears that the estimated cost of drilling the proposed well upon the city property, plus the $30,000.00 bonus, amounted to about $80,000.00. Susser informed Gregg that he was unable to pay one-third of this amount and, after negotiations between the two, Gregg finally agreed to assign to Susser an oil payment of $100,000.00 out of a certain percentage of the oil from the well, as, if and when produced.
The above briefly states the evidence relied upon to carry the case to the jury. In our opinion it is insufficient as a matter of law. The rules relating to the necessary quantum of proof in fraud cases are variously stated. It is conceded that an extensive latitude should be exercised in admitting circumstantial evidence where the existence of a conspiracy is in issue. Jernigan v. Wainer, 12 Tex. 189; Vittitoe v. Junkin, Tex.Civ.App., 54 S.W.2d 166, 15 C.J.S., Conspiracy, § 29,3 p. 1043, but despite the latitude applicable to the admission of evidence, the rule as to the sufficiency of the evidence to meet the requisite standard of proof has been rather strictly stated. Some cases hold that in order to show conspiracy or fraud it is necessary that the evidence be full, clear and satisfactory. Selari v. Selari, Tex.Civ.App. 124 S.W. 997; S. Cantu & Son v. Ramirez, Tex.Civ.App., 101 S.W.2d 820; Fernandez v. Cano, Tex.Civ.App., 108 S.W.2d 310; Elick v. Schiller, Tex.Civ.App., 235 S.W.2d 494, reversed on other grounds, Schiller v. Elick, 150 Tex. 363, 240 S.W.2d 997. It is likewise said that fraud will not be presumed, Paxton v. Boyce, 1 Tex. 317; Whitsel v. Hoover, Tex.Civ.App., 120 S.W.2d 930, but that, on the contrary, there is a presumption in favor of honesty and fair dealing. Turner v. Lambeth, 2 Tex. 365; Giddings v. Steele, 28 Tex. 732, 733; Fletcher v. Ely, Tex.Civ.App., 53 S.W.2d 817; Hawkins v. Campbell, Tex.Civ.App., 226 S.W.2d 891. For the purposes of practical application, perhaps the most satisfactory statement of the rule is that evidence which raises no more than a conjecture, suspicion or surmise of fraud is insufficient to take the case to the jury. Joske v. Irvine, 91 Tex. 574, 44 S.W. 1059; Green v. Texas & Pacific Ry. Co., 125 Tex. 168, 81 S.W.2d 669; Cole v. Missouri-Kansas-Texas R. Co., Tex.Civ.App., 179 S.W.2d 343, 344; Hayter v. Hudgens, Tex.Civ.App., 268 S.W. 480; Smith‘s Heirs v. Hirsch, Tex.Civ.App., 197 S.W. 754; Metropolitan Cas. Ins. Co. of New York v. Texas Sand & Gravel Co., Tex.Civ.App., 68 S.W.2d 551. A corollary to this rule, as stated by the Waco Court of Civil Appeals in Perren v. Baker Hotel of Dallas, 228 S.W.2d 311, 317, is that, “Where circumstances are equally consistent with the existence and nonexistence of an ultimate fact (fraud in this case) sought to be established, such circumstances
are wanting in probative force as any evidence tending to establish the existence of the ultimate fact.”
In applying the rules above stated to the record before us, it is well to consider those necessary elements of a fraudulent conspiracy which are not shown by direct evidence and hence must be supplied by inference. There are also certain matters established by the undisputed evidence which can not be ignored. Although there is evidence that Wasserman and Susser were friends, there is no direct evidence that Susser ever talked to Wasserman about Gregg‘s obtaining a lease upon the city property. Similarly there is no direct testimony that Wasserman urged or suggested to any member of the city council that the oil and gas lease be awarded to Gregg. It is undisputed in the evidence that the bid made by Gregg for the oil and gas lease in question was the highest and best bid made for the lease. Likewise, it is undisputed that the Ella Wade was a known producer prior to the time the bidding for the City lease was closed. It does not appear that Susser‘s attempts to gain information relating to the Ella Wade well resulted in his obtaining any particular informational advantage. Appellant‘s position in its brief, as we understand it, is not that Susser and Gregg were possessed of information superior to that possessed by others in the Corpus Christi area, or that Gregg‘s bid was not the highest and best received, but rather that the city council, being corruptly influenced, had acted with unseeming haste in awarding the lease upon the property, and that had the time been extended beyond January 19th, other and larger oil producing companies may have been induced to bid for the lease.
We may assume that the making of the $20,000.00 loan to Wasserman by Gregg, upon a relatively short acquaintance, constituted a suspicious circumstance and that Gregg on January 4th desired the assistance of Wasserman in securing leases from the City of Corpus Christi in the future. But from this circumstance it can hardly be inferred that Wasserman attempted to and was successful in corrupting the members of the city council and thus caused them to set an unreasonably short period of time for the receiving of bids. In order to arrive at such conclusion, it is necessary to employ surmise and conjecture and thus violate the rule which demands a higher quality of probative force. No reversible error is presented by appellant‘s first point and it is accordingly overruled.
By its second point, the City complains of the action of the trial court in sustaining a special exception which resulted in the striking from the petition of all allegations relating to the complaint that the leases in question violated the provisions of Article 5400a, Vernon‘s Ann.Tex.Stats. This point squarely raises the question of whether or not said Article 5400a is applicable to oil and gas leases executed by a city or town.
Article 5400a was adopted by the Forty-fifth Legislature, Acts 1937, p. 568, ch. 279. This Act and the earlier statute relating to the leasing of lands belonging to cities and towns, Article 1267, Vernon‘s Ann.Tex.Stats., are set out in the margin in order to facilitate comparison.4 By its terms, the 1937 Act applies to “political subdivisions which are bodies corporate with recognized and defined areas.” It purports to authorize political subdivisions of the State of Texas to lease lands owned by them for mineral development purposes and prescribes the procedure to be followed in the making of such leases. One of the requisites set forth in the Act is the giving of notice of an intention to lease, which shall be published in some newspaper of general
circulation for a period of three consecutive weeks. Appellees concede that in awarding the leases here involved the City of Corpus Christi did not advertise the proposals in the detail set forth in Article 5400a, but strongly urge that said article has no application to cities and towns. Their argument is that long prior to 1937, the Legislature had adopted an Act which authorized cities and towns to lease lands owned by them for mineral purposes. Acts 1919, p. 183, Article 1267, Vernon‘s Ann.Tex.Stats.5 It is pointed out that said Article 1267 is specific in two particulars, in that it relates to cities and towns and to the execution of oil, gas and mineral leases. In other words, it specifically authorizes cities and towns to execute oil and gas
the Act was to either confer or make abundantly clear the power of political subdivisions to execute oil and gas leases.
To say, however, that the 1937 Act applies only to those political subdivisions which prior thereto possessed no authority to execute leases is to run afoul of the decision of the Eastland Court of Civil Appeals in Culver v. Miears, 220 S.W.2d 200, in which the Supreme Court refused a writ of error. In the cited case the controlling question was whether or not Article 5400a applied to an oil and gas lease executed by a common school district. The Court held that such school districts were authorized to execute oil and gas leases prior to the enactment of Article 5400a. The particular statutory provision mentioned was
The only distinction we find between the present case and Culver v. Miears is that here we have an earlier specific provision relating to the execution of a mineral lease, while in the Miears case the provision was one relating generally to sales, which was construed as embracing the authority to execute an oil and gas lease. This difference seems an insufficient basis upon which to logically base a contrary holding. The issue therefore is whether or not Culver v. Miears should be followed. There is some discussion in the briefs as to the effect of the Supreme Court‘s refusing a writ of error in the cited case. It is said that the Supreme Court, by refusing the writ, did not necessarily approve the holding of the Court of Civil Appeals [220 S.W.2d 202] to the effect that prior to the enactment of Article 5400a, “there was nothing to prevent the trustees from leasing land belonging to the district.” It is then argued that the Miears case is consistent with appellees’ contention that
We think the refusal of the writ in the Miears case was at least an indication by the justices who then composed the Supreme Court, that they would probably follow the holdings set forth in the opinion of the Court of Civil Appeals in a future case presenting a similar factual situation. Furthermore, it seems reasonably clear to us that common school districts were possessed of authority to execute oil and gas leases prior to 1937, when Article 5400a was adopted and consequently we see no reasonable basis for making a distinction between common school districts, on one hand, and cities and towns, on the other, insofar as the applicability of Article 5400a is concerned.
The cardinal rule of statutory construction is to ascertain the intention of the Legislature, 50 Am. Jur. 200, Statutes, § 223, and when a statutory enactment contains plain and unambiguous language and conveys a clear and definite meaning, there is no occasion for resorting to other rules of statutory interpretation. 50 Am.Jur, 204, Statutes, § 225. The Legislature is presumed to mean what it says. Article 5400a, by its wording, applies to “political subdivisions which are bodies corporate with recognized and defined areas.” “Certainly a city, just as an irrigation district (or a school district) is a political subdivision of the State for such governmental purposes, as are given in charge to it.” Supreme Forest Woodmen Circle v. City of Belton, 5 Cir., 100 F.2d 655, 657; Ex parte Ernest, 138 Tex.Cr.R. 441, 136 S.W.2d 595. The crucial portion of Article 5400a here involved is that relating to notice. Obviously, there is no conflict between the provisions of Article 5400a, prescribing notice by newspaper publication and Article 1267, which contains no provisions relating to notice. In the cases cited by appellees in support of the proposition that a specific
“By the terms of the unemployment compensation law it is made applicable ‘to any individual or type of organization.’ This language, on its face, would include fraternal benefit societies, but by the application of well settled principles of statutory construction the conclusion follows that this law, being a general statute, did not operate to repeal the special law above referred to exempting fraternal benefit societies from excise taxes. The special law will be regarded as an exception to the general law.”
When there is conflict, the specific enactment may be construed as controlling over the general,6 but when there is no conflict between two statutes the legislative intent must be ascertained by construing the two acts together. “‘All acts in pari materia’ said Lord Mansfield, ‘are to be taken together as if they were one law.’ (Sedg. 247.) There is no doctrine in relation to the construction of statutes more certainly settled than this: that all acts in relation to the same subject are to be taken in pari materia and considered as one act.” Cain v. State of Texas, 20 Tex. 355, 362; United States v. Borden Co., 308 U.S. 188, 60 S.Ct. 182, 84 L.Ed. 181; 39 Tex. Jur. 253, Statutes, § 135; 2 Sutherland, Statutory Construction, 3rd Ed., § 5204. This was the rule applied by the Eastland Court in Culver v. Miears, and is deemed controlling here. The trial court erred in sustaining the special exception and striking from the petition the allegations relating to a non-compliance with the provisions of Article 5400a.
The trial court also sustained certain special exceptions which resulted in striking all allegations of the petition alleging a non-compliance with the provisions of Sections 17 and 18 of Article 2 of the City Charter, and Article 1112, Vernon‘s Ann.Tex.Stats. As we understand the charter sections referred to, they require publication of ordinances relating to grants of easements and franchises which involve the use of streets, highways, public thoroughfares and property of the city, its avenues, parks, bridges and other public places and property, but do not apply to the execution of oil and gas leases. Likewise,
For the error pointed out, the judgment of the trial court must be reversed. We have herein discussed such matters as may arise upon a retrial of the case. Other points contained in the briefs raise questions which need not and probably will not arise upon a second trial, and hence discussion of them is pretermitted.
The judgment appealed from is reversed and the cause remanded.
The CHIEF JUSTICE concurs in the foregoing, but remains of the opinion that
appellees’ motion to affirm on certificate should have been sustained. See dissenting opinion, City of Corpus Christi v. Gregg, Tex.Civ.App., 267 S.W.2d 478, 481.
On Motion for Rehearing
By separate arguments filed in support of their motion, Gregg and Susser urge that Article 5400a, Vernon‘s Ann. Civ. Stats., does not apply to a home rule city, because a municipality when acting in a proprietory capacity can not be properly classified as a “political subdivision.”
It is well settled that a city performs both governmental and proprietory functions. As pointed out in the arguments, the case cited by us as authority for the proposition that a city is a political subdivision of the State, expressly recognized this dual capacity. Supreme Forest Woodmen Circle v. City of Belton, 5 Cir., 100 F.2d 655. We are also cited to the 1953 Act relating to oil and gas pooling agreements which refers to “Cities and towns chartered or organized under the General Laws of Texas, or by special act or charter,” and to “Political subdivisions which are bodies corporate with recognized and defined areas“, thus suggesting that the Legislature recognized two species of public or political subdivisions, namely, cities and towns, on the one hand, and counties, water districts and the like, on the other. Acts 1953, 53rd Leg. p. 686, Ch. 262,
In view of these historical distinctions, it would have been appropriate to have referred to both cities and other political subdivisions in providing for a general preliminary notice of an intention to execute an oil and gas lease. An Act containing such references could probably have been more accurately indexed and catalogued with reference to the Revised Statutes as relating to “Cities, Towns and Villages,” as well as to the general subject of “Lands-Public.” The draftsmen who prepared the 1953 bill (now
A school district, when engaged in educating the children of the State, may be said to be exercising a governmental function. Similarly a city, when enforcing a health regulation, is exercising a governmental function. Ex parte Ernest, 138 Tex.Cr.R. 441, 136 S.W.2d 595. Money is required to carry out either function and the end purpose sought to be obtained by the execution of an oil and gas lease is the procurement of funds necessary for the operations of the organization. Insofar as the nature of the act is concerned, it is difficult to draw a logical distinction between the execution of an oil and gas lease
In determining the intent of the Legislature our primary guide must of necessity be the wording contained in the statute. Article 5400a is admittedly a statute which is wide in its scope of operation. It has for its purpose the safeguarding of the properties of political subdivisions of the State by requiring a notice of intention to lease for oil and gas. The scope and purpose of the statute is well within the legislative authority and we may not properly restrict its operation to something less than that prescribed by its wording. Such a construction would defeat the announced legislative intent and contribute to confusion rather than lessen it.
Furthermore, in view of the Supreme Court‘s refusal of the application for writ of error in Culver v. Miears, we are not at liberty to depart from the holding contained therein. Agnew v. Coleman County Electric Co-operative, Tex.Sup., 272 S.W.2d 877; Bennett v. Brown County Water Improvement District No. 1, Tex.Sup., 272 S.W.2d 498; Mitchell v. Town of Refugio, Tex.Civ.App., 265 S.W.2d 261, wr. ref.; 21 C.J.S., Courts, § 197, p. 343.
We adhere to the holdings announced in our original opinion and appellees’ motion for rehearing is accordingly overruled.