Case Name: WYLIE v. STATE et al.; JACKSON et al. v. SAME
Court: Texas Courts of Civil Appeals
Jurisdiction: Texas
Decision Date: 1937-02-10
Citations: 108 S.W.2d 291
Docket Number: No. 8480; Motions Nos. 8599, 8641, 8704
Parties: WYLIE v. STATE et al. JACKSON et al. v. SAME.
Judges: 
Reporter: South Western Reporter Second Series
Volume: 108
Pages: 291–296

Head Matter:
WYLIE v. STATE et al. JACKSON et al. v. SAME.
No. 8480; Motions Nos. 8599, 8641, 8704.
Court of Civil Appeals of Texas. Austin.
Feb. 10, 1937.
On Rehearing March 24 and June 23, 1937.
Rehearings Denied April 21, 28, May 26, and July 28, 1937.
Hill & Bath, of Henderson, for appellant A. C. Wylie.
Wm. McCraw, Atty. Gen., and W. J. Holt, C. M. Kennedy, Earl Street, Joe Sharp, and Wm. C. Davis, Asst. Attys. Gen., for the State.

Opinion:
BAUGH, Justice.
Suit was originally filed by the state against V. E. Jackson and others for penalties for alleged violations, by the several defendants, of the conservation laws of Texas (Vernon's Ann.Civ.St. art. 6004 et seq.) and of the rules of the Railroad Commission in numerous respects; for injunction, and for appointment of receivers for numerous properties in Upshur county, Tex., including refineries, pipe lines, oil wells, storage pits and tanks, and quantities of oil located therein. On October 25, 1935, the trial court entered its order appointing two receivers, ordered the defendants to turn over - to them numerous designated properties therein specified, and appointed an attorney to represent the receivers. Thereafter on November 20, 1935, the attorney so appointed by the court filed an unverified motion in said cause to require the defendants to turn over to the receivers, in addition to the properties described in the original order of the court, and among others not in issue here, approximately 60,000 barrels of fuel oil, more or less, located in a described earthen pit, known as the Farris pit, in Upshur county. This oil was designated in said motion as that described "in cause No. 947-C styled' 'A. C. Wylie v. East Texas Oil & Refining Company,' in the Special District Court of Gregg County, Texas."
On December 4, 1935, under leave granted by the court, A. C. Wylie intervened in said suit, setting up title in him to 101,680 barrels of oil alleged to be located in the Farris pit, which plea was amended by petition filed December 9, 1935, on which the matters here in controversy were tried, wherein he asked the court to dissolve the receivership as to the oil in the Farris pit on the following grounds:
a. That the motion of the receivers on which the court placed said Farris pit oil in the receivership was insufficient to sustain the court's order in so doing,
b. That said motion was granted ex parte without notice or hearing upon an unverified application therefor.
c. That intervener was owner of the oil in said pit and was not a party to the original suit in which the receivers were appointed.
d. That the original order appointing the receivers did not authorize them to seek or acquire possession of this pit of oil.
Intervener also pleaded his title to the oil and the method and manner of its acquisition, the judgment of the district court of Gregg county decreeing title and possession of said oil to him, that same was a final judgment, and prayed that as to this pit of oil the receivership be discharged.
On December 18, 1935, there was filed what purports to be an answer of the receivers to Wylie's motion. This purported answer is not signed by any one, but no question is raised as to this and the hearing appears to have proceeded on the issues made by it. In addition to general demurrer and general denial to Wylie's motion to vacate the receivership as to this particular property, the receivers alleged that the defendants in the state's suit had an undisclosed partnership with one R. B. Farris in said earthen pit; that Farris leased this pit to the East Texas Refining Company; and that the latter named company had on October 28, 1935, conveyed the oil therein to thé defendants named in the state's suit. Neither Farris nor the East Texas Refining Company was party to the state's suit.
Hearing was had on Wylie's motion on December 18, 1935, and on December 20, 1935, the trial court entered its order, finding that the oil in the Farris pit was legally in the possession of the receivers, awarded title and possession of the oil in question to the receivers as against Wylie, and denied his motion to vacate the receivership as to the Farris pit of oil. From this order Wylie has appealed.
The receivers have filed no brief. The state has filed a copy of the brief filed by it in cause No. 8599, State v. Jackson (Tex.Civ.App.) 101 S.W.(2d) 346, which was an appeal by writ of error from the order of the district court entered in the main suit in June, 1936, directing the receivers to sell the oil in the' Farris pit. After the appeal in cause No. 8599 was perfected, however, it was made to appear that said oil had already been sold and the proceeds paid into the registry of the district court. That appeal was on January 13, 1937, dismissed by us because the subject-matter thereof had become moot. The brief of the state in that case consequently has little application to the issues presented by this appeal.
Manifestly the judgment of the trial court cannot be sustained. The unverified motion of the receivers after they had qualified as such to bring into their possession property for which the state did not sue, and which was not included in the properties sought to be impounded by the State in its original penalty suit, shows upon its face that this very oil was in litigation in the district court of Gregg county between A. C. Wylie and the East Texas Oil & Refining Company, neither one of whom was a party to the original suit of the state. Not only so, but the judgment in the Gregg county case was in said motion specifically referred to for a description of the oil in question. The terms of that judgment were not pleaded by the receivers; but said judgment was pleaded and introduced in evidence by Wylie upon his intervention hearing. No attack was or has been made upon that judgment. It was rendered on October 2, 1935, awarding title and possession of 101,680 barrels of oil in .the Farris pit to Wylie as against the defendants named in that suit. In addition to said judgment of the district court of Gregg county, Wylie offered testimony to show that he had captured waste and abandoned oil on nearby lands which he had caused to be stored in this pit. The defendants in the suit of the State filed no pleadings as against Wylie's claim herein, and made no claim to any part of said oil. Nor do we find any competent testimony offered by the receivers that said defendants owned any title whatever in said oil.
The result of this proceeding was, therefore, that under order of the dis trict court in a summary proceeding the receivers took from the possession of a third person, not a party to the state's suit, the property in possession of such third person under judgment of another district court; and that, too, without any showing upon the trial of intervener's claim to it, that either the original defendants in the suit of the state, or the receivers appointed in that suit, had any right or title to it whatever.
The general rule is well settled that a receiver cannot through a summary proceeding take into custody property found in ' the possession of strangers to the record claiming same adversely. If the property belonged in the receivership in such case, the receivers should have brought a separate suit against such claimant; or the state should have had Wylie made a party to the original proceeding and had the receivership extended to him. Ex parte Renfro 115 Tex. 82, 87, 273 S.W. 813, 40 A.L.R. 900; Nelson v. Thompson (Tex.Civ.App.) 64 S.W.(2d) 373, 375; 36 Tex. Tur. p. 185, § 89. Neither method was resorted to in the instant case.
The receivers' motion alleged that there was approximately 60,000 barrels of oil in said Farris pit, and appellant's plea of intervention alleged there were 101,680 barrels located in same. Though the state ⅝ filed no further pleading in the matter of Wylie's intervention, the Attorney General contested his claim on said hearing on the ground that said oil was contraband and was placed in said pit in violation of law and the rules of the Railroad Commission. Since this appeal was perfected, the oil involved has been sold by the receivers. Appellant filed in this court a motion to have the proceeds therefrom paid into the registry of the district court. This motion was granted and the trial court was instructed to hear evidence and ascertain the quantity of oil in said pit at the time same was ordered sold. A hearing was had by the trial court on that question on December 18 and 19, 1936, and a transcript of the evidence then taken has been returned to this court. No finding, however, was made as to the quantity of such oil in. said pit at the time; and we are unable to determine from that record the correct quantity of oil in the pit at that time. Under these circumstances, we are not in position to render a proper judgment here; but think the case should be reversed and remanded to the trial court for further hearing in that regard, without prejudice to the rights of the state to assert its contention by proper pleading and proof that all or any part of the oil in question was illegal oil.
Reversed and remanded.