Title: Richardson v. First National Life Insurance Co.
Citation: 419 S.W.2d 836
Docket Number: A-11613
State: Texas
Issuer: Texas Supreme Court
Date: July 26, 1967

419 S.W.2d 836 (1967) Kent W. RICHARDSON, Petitioner, v. FIRST NATIONAL LIFE INSURANCE COMPANY, Respondent. No. A-11613. Supreme Court of Texas. July 26, 1967. Rehearing Denied November 1, 1967. *837 Colunga &amp; Wennermark, John D. Wennermark, San Antonio, for petitioner. Heath &amp; Davis, Dudley D. McCalla, Austin, for respondent. GRIFFIN, Justice. Petitioner, as plaintiff below, filed suit in a district court of Bexar County, Texas, against respondent, as defendant, for commissions due him as agent for the defendant. He alleged "that plaintiff believes that at least the amount of Three Hundred Fourteen and 37/100 Dollars ($314.37) is due him for commissions from the policies sold under said contract." He further asked for an accounting. Defendant filed its plea to the jurisdiction of the court because it appeared "from the face of the petition that the matter in controversy, exclusive of interest, amounts in value to less than $500.00," etc. The trial court sustained this plea and dismissed the suit at plaintiff's costs. On appeal, the Court of Civil Appeals affirmed. 408 S.W.2d 525. We affirm the judgments of the courts below. Petitioner says that his suit was one for an accounting and that it was properly brought in the district court, as that court is a court of general jurisdiction. The allegations of plaintiff's petition are that on February 13, 1961, plaintiff entered into a contract with defendant to sell insurance policies in defendant's company as defendant's agent; that plaintiff has in all things complied with the "stipulations, conditions, and agreements" placed on him by the contract, but that defendant has failed and refused to pay plaintiff the commissions due him on the policies "pursuant to the provisions of said contract." Plaintiff further alleged that he has "demanded an accounting for said commissions" and has been refused such accounting by defendant at all times. Then follows the only allegation of any sum due plaintiff by defendant: "That plaintiff believes that at least the amount of Three Hundred Fourteen and 37/100 Dollars ($314.37) is due him for commissions from the policies sold under said contract." In his prayer plaintiff prays that defendant be required to make an accounting, "that plaintiff have judgment against the defendant for at least $314.37, and for such other sums as shall be found due on such accounting," and for general relief. Petitioner's contention is based upon the fact that the constitutional and statutory provisions confer upon the district court general residuary jurisdiction. This contention has application only when considered in connection with the language of Art. V, Sec. 8 of our State Constitution, Vernon's Ann.St. That language does not say the district court has jurisdiction of all suits that may be brought. The exact language of the residuary clause is, "The District Court shall have original jurisdiction * * * [in enumerated cases] when the matter in controversy shall be valued at or amount to five hundred dollars exclusive of interest * * * and shall have general original jurisdiction over all causes of action whatever for which a remedy or jurisdiction is not provided by law or this Constitution * * *." Art. 1909, Revised Civil Statutes 1925, as amended, contains language of similar import. The residuary clause of the Constitution applies only to those cases "for which a remedy or jurisdiction is not provided" by law or the Constitution. The jurisdiction given by this language is not concurrent with the jurisdiction of the other courts, but is an exclusive *838 jurisdiction within its field. (All emphasis is that of this Court.) The only way the district court's jurisdiction could be sustained would be to hold that this is a suit in equity. That is not correct. This suit is an ordinary suit on a written contract of employment which plaintiff attaches to his petition. Plaintiff's demand is a money demand. The residuary clause of Art. V, Sec. 8 applies only to causes of action for which a remedy or jurisdiction is not provided by law or the Constitution. The Constitution provides that suit must be brought in the county court for a debt that exceeds $200.00 and does not exceed $500.00. Rule 172, Texas Rules of Civil Procedure, provides among other things that when an investigation of accounts or examination of vouchers is necessary in any suit, the trial court "shall appoint an auditor or auditors to state the accounts between the parties," etc. This plaintiff's cause of action herein is not an equitable action; it is not an action for which no remedy nor jurisdiction is provided by the Constitution and the law. Therefore, it is not entitled to be heard in the district court, but must be heard in the county court. With regard to the contention that the allegation seeking an accounting makes an equitable action of plaintiff's demand and also makes the residuary clause of Art. V, Sec. 8 controlling, there is an excellent annotation in 3 A.L.R.2d 1310, entitled "Availability of Equitable Remedy of Accounting Between Principal and Agent." In this annotation there is quoted from Restatement of Agency, Vol. 2, Sec. 399, the rules governing an accounting suit between principal and agent: These same rules apply to an action of an agent against his principal. 3 A.L.R.2d 1369 et seq., § 19. This annotation also quotes from 4 Pomeroy Equity Jurisprudence, 5th Edition, Sec. 1421, *839 From the above annotation and the excerpts we have cited, we find that this suit does not qualify as an equitable proceeding for which our Constitution and statutes provide no remedy or jurisdiction. The general rule is that the allegations of the plaintiff's petition must state facts which affirmatively show the jurisdiction of the court in which the action is brought. Brown v. Peters, 127 Tex. 300, 94 S.W.2d 129 (1936); Smith v. Horton, 92 Tex. 21, 46 S.W. 627 (1898); Texas &amp; N. O. R. R. Co. v. Farrington (Tex.Com.App., 1905), 40 Tex.Civ.App. 205, 88 S.W. 889. "The rule of law seems to be well settled in this state that, if plaintiff pleads generally a state of facts, and goes further and pleads specifically and particularly on the same subject, he cannot rely upon the general allegations, but is confined in his recovery to those specifically and particularly pleaded. Specific allegations will control those of a general character." (Citing authorities.) Houston Printing Company v. Hunter (Tex.Civ.App. 1937), 105 S.W.2d 312, 318, aff'd 129 Tex. 652, 106 S.W.2d 1043. In our case the Constitution and statutes do give jurisdiction to various courts to determine suits for debt, based on the allegations in the petition as to the amount in controversy. Also, in our case the only allegation as to a definite debt is $314.37, and that amount is not within the jurisdiction of a district court. We affirm the judgments of both courts below. CALVERT, C. J., concurs in the result. SMITH, Justice. I respectfully dissent. This case presents the narrow question of whether the district or county court has jurisdiction to entertain the suit. In order to determine this question, the nature of the relief sought must be first determined. This is a suit for equitable relief in a situation where the terms of the contract reveal a close fiduciary relationship between Richardson and First National. Richardson alleged in his petition facts showing that he was seeking an accounting. The contract attached to the petition reflects that First National was under a duty to keep an accurate account of all commissions due Richardson. The contract specifically states that "[t]he ledger account of the Company shall be competent and conclusive evidence of the state of accounts between you [Richardson] and the Company." It is clear that any records kept by Richardson would be of no avail in the event of the failure of First National to divulge the contents of its ledger accounts pertaining to Richardson. First National collected all premiums, but, according to Richardson's pleadings, "* * * failed and refused, and still fails and refuses, to perform said contract on its part, in that Defendant, notwithstanding said contract, did collect monies on the policies sold by Plaintiff pursuant to said contract, and has failed and refused to pay Plaintiff the commissions due on said policies to him pursuant to the provisions of said contract. That Plaintiff has demanded an accounting for said commissions from Defendant repeatedly since May 1st, 1964, and has been refused such accounting by Defendant at all times." Then, follows the allegation: "* * * Plaintiff believes that at least the amount of Three Hundred Fourteen and 37/100 Dollars ($314.37), is due him for commissions from the policies sold under said contract." Then, follows the prayer: There are certain provisions of the contract which conclusively demonstrate that Richardson by the decision of this Court has been deprived of his constitutional right to a trial. His petition alleges that "Defendant is a foreign Life Insurance Company, having its home office at * * * Phoenix 14, Arizona, which has designated * * * Commissioner of Insurance, State Board of Insurance, * * * as its duly authorized agent and attorney in fact, etc." So far as this record indicates, all accounts and records of premium collections are kept by the Company at its home office in Phoenix, Arizona. Regardless of where such records are kept, Richardson can never successfully obtain a judgment until First National is compelled to perform its part of the agreement. It follows that he could not at the time of filing suit know the exact amount due him. Consider the following provisions of the contract in determining whether this is a suit for an accounting, an equitable action, or is, as stated by this Court, "* * * an ordinary suit on a written contract of employment." To be found in the contract are provisions that all life policies written by Richardson, the face amount of which is $50,000.00 or more, First National has the right to fix the amount of the first year commission. The contract provides that this commission shall not be reduced below the commission provided in Paragraph A, Section 4 by more than 10% of the first year premium. To further complicate the matter of accounting and to point up the error of this Court's holding, there appears as a part of the contract a "supplement to agent's agreement", dated June 2, 1959, which reads: Finally, I point to the provision of the contract dealing with "Commissions on Conversions.": Under the record in this case, Richardson's suit should be classed as a proceeding in equity. He has clearly brought a suit where all of the essential facts are peculiarly within the knowledge of First National. Therefore, Richardson was required only to allege, as he did, with reasonable certainty the employment as agent for First National, the Manner of Compensation, the performance of services showing some commissions to be due, and the facts and circumstances demonstrating that the correct amount could not be ascertained without an accounting. See Brea v. McGlashan (1934) 3 Cal. App. 2d 454, 39 P.2d 877; Arbuckle v. Clifford F. Reid, Inc. (1931) 118 Cal. App. 272, 4 P.2d 978; Shepard v. Brown (1863) 9 Jur.NS (Eng) 195; Williams v. Finlaw, Mueller &amp; Co. (1928) 292 Pa. 244, 141 A. 47; Miller v. Russell (1906) 224 Ill. 68, 79 N.E. 434. This latter case emphasizes the fact that the agent in that case, as here, was without adequate means of ascertaining the true status of the accounts. The Supreme Court of Illinois in Miller, supra, a case factually similar to the present case, held against the contention of Miller that the cause of action was an ordinary suit on a contract. The Court rejected Miller's contention that the Company occupied no fiduciary relation to Russell and that the Company did not hold *841 the money received by it in trust for Russell. The Court also rejected Miller's contention that Russell had "an ample and adequate remedy at law". The Court, after stating that Russell's "objections go to the jurisdiction of a court of equity", held: If Courts of equity have general jurisdiction, we turn to the question we have before us. In determining whether the district or county court has jurisdiction to entertain this suit in equity, I pose the hypothetical question: What would happen if, under *842 the same allegations, suit had been brought in the county court? In deciding this question, it should be kept in mind that, disregarding certain types of suits (none of which are involved here) where jurisdiction is determined by the subject matter of the case, the county court has potential jurisdiction when the amount in controversy is between $200 and $1,000. See Texas Constitution, Article V, Section 16; Vernon's Annotated Texas Statutes[1], Article 1949; Article 1950. Jurisdiction in the district court, on the other hand, commences at $500 and is without limit. See Tex.Const., Article V, Section 8, Vernon's Ann.St. Article 1906. Thus, between $500 and $1,000 the county courts and the district courts have concurrent jurisdiction. To be considered in connection with the above provisions are the statutory and constitutional provisions which confer upon the district court general, residual jurisdiction. Thus, by Article V, Section 8 of the State Constitution, it is provided in part: Article 1909, provides: First National argues that it affirmatively appears from the pleadings that the amount in controversy is less than $500 and therefore jurisdiction for this case is not in the district court. I disagree with this conclusion. It does not affirmatively appear from the pleadings that this cause falls within the jurisdiction of the county court. In fact, if the suit had been brought in the county court, the sustaining of a plea to the jurisdiction would have been proper. As the county court is a court of limited jurisdiction, it is without power to render a judgment which exceeds its constitutional limit of $1,000. If, of course, jurisdiction in the instant case were improperly placed in the county court an entry of a judgment exceeding $1,000 would be void. No authority need be cited for the proposition that a void judgment is an absolute nullity and, as such, confers no rights and binds no one. These propositions are elementary. As was stated in Freeman v. Freeman, 160 Tex. 148, 327 S.W.2d 428 (1959): Thus, if the present case were brought in the county court, and if a plea to the jurisdiction was not sustained and if subsequently developed that Richardson was entitled to a judgment of more than $1,000, the court would be powerless to enter the judgment. The point is that an allegation that Richardson is entitled to at least $314.37 plus whatever an accounting may reveal he is entitled to could yield a total of more than $1,000. The county court being unable to enter a judgment for more than $1,000, Richardson would then be forced to seek his relief in a district court. This Court should refuse to countenance such a spectacle. As I read the pleadings, Richardson believes he is entitled to at least $314.37, and such additional sums to which an accounting may reveal he is owed. As the case has not gone to a trial on its merits and there is no statement of facts, this Court has no way of knowing what, if anything, First National may owe Richardson under the contract, although it should be pointed out that the contract contains the usual provisions *843 for commissions for the sale of policies. In my view of the case, however, this is immaterial as this Court is here concerned solely with determining the proper court in which this lawsuit should be maintained on the basis of the pleadings. The proper forum for this case is in the district court pursuant to Article V, Section 8 of the State Constitution, supra, and Article 1909, supra. The judgments of the trial court and the Court of Civil Appeals should be reversed and the cause remanded to the district court for a trial on the merits. WALKER and STEAKLEY, JJ., join in this dissent. [1] All statutory references hereinafter contained are to Vernon's Annotated Texas Civil Statutes.