Court Opinion

ID: 5003785
Source: CourtListenerOpinion
Date Created: 2021-10-01 01:42:27.98363+00
Date Added: 2024-06-11T08:17:11.883541
License: Public Domain

On Appellee’s Motion for Rehearing.
Appellee urges that the case of Bigham v. Talbot & Cropper, 63 Tex. 271, decides this case, and that we did not discuss said case in our original opinion. In the cited case, plaintiff filed a petition, as shown in Bigham v. Talbot, 51 Tex. 450, based on this order:
“‘Mr. S. Bigham — Dear Sir: You will please pay to Cropper & Talbot all moneys due and will be on mail contract route from Camp Colorado to Meridian and from Hamilton to Comanche up to July, 1875. This, 14th of November, 1874.
“ ‘Yours truly, W. H. Woodburn.’
“Which was accepted, as follows:
“ T accept the within order for all amounts that may be due from and after the 30th of September, 1874. This, October 28, 1874.
“ ‘Sam W. Bigham.’ ”
Bigham was a subcontractor himself on these routes. He sublet to W. H. Woodburn. Woodburn transferred the contract for a portion of the time to Overstreet & Bonner, and he transferred the remainder of the time to Overstreet & Talbot. Overstreet transferred his interest therein to Talbot & Cropper, and on the 14th day of November, 1874, Wood-burn gave an order to Talbot & Cropper on Bigham for all moneys due and to be due on the contract between them, which order was accepted by Bigham as to all amounts that might be due after September 30,1874. Plaintiffs below, Talbot & Cropper, asked judgment on amount of contract and liquidated damages for $1,000.
Bigham, who was á resident citizen of Cor-yell county, the suit being filed in Comanche county, demurred to the jurisdiction of the court because the petition did not state affirmatively such facts as would give it jurisdiction over his person. This was in effect his plea of privilege to be sued in Coryell county. Judge Bonner, speaking for. the Supreme Court, held that there were some general allegations in the petition which, abstractly considered, would have given the court jurisdiction, yet the pleadings, taken as a whole, in connection with the exhibits made a part thereof, did .not present such a case as, over the objection of the defendant, authorized the court to take jurisdiction over his person, and, in the court’s opinion, there *785was error in the judgment overruling the demurrer. Therefore the court reversed the judgment below and remanded the cause for a new trial.
On a third trial, 63 Tex. 271, Commissioner Watts held the facts to be that the plaintiffs below, Talbot & Cropper, brought suit on July 13, 1876, to recover certain moneys claimed to be due them as the assignees of a contract made and entered into between appellant and W. H. Woodhouse [Woodburn], concerning the transportation of the United States mail upon certain routes named. The cause was tried and appealed, and was by the Supreme Court reversed and remanded. After the reversal, appellees filed their first amended original petition, to wit, February 9, 1880, and on the same day took judgment by default. Upon appeal, it was held that the amendment set up a new cause of action, and that it was necessary to have service upon Bigham, and the cause was again reversed and remanded. On September 3, 3883, appel-lees filed their second original petition, reasserting the cause of action asserted in their original petition, with elaborate allegations as to their intention in filing the first amended petition. Appellant specially excepted to the amended petition, upon the ground that the cause of action therein asserted appeared from the allegations to be barred; this was overruled. The court held that if, as claimed by appellant, the second amended petition asserted a new cause of action, which would be subject to the operation of the statute of limitation, then the exception was certainly well taken, and the court erred in overruling the same; that the cause of action distinctly asserted by the first amended petition was for an amount of money claimed to be due appellees from appellant for carrying the United States mail on certain designated routes, by reason of a contract made and entered into by and between appellees and appellant on the 28th day of October, 1874; while that asserted by the second amended petition was for an amount of money claimed to be due them from appellant for carrying the United States mail upon the same routes, by reason of the contract made and entered into by and between appellant and Woodburn, and assigned by Woodburn to Overstreet and Talbot, and by Overstreet to Talbot & Cropper. This was also the same cause of action that was asserted by the original petition. The Supreme Court held that there were distinct causes of action alleged, and, if there had been any allegations in the first amended petition in any way retaining, even as part of the cause of action therein asserted, that which was asserted by the original petition, and afterwards reasserted by the second amended petition, that it would have been sufficient to prevent the running of the statute after the original petition was filed, but that such was not the case; that the Woodburn contract was entirely abandoned in the first amended petition as constituting the cause of action, except alone as an inducement for the $192 claimed by reason of the acceptance; that such contract was not declared on as constituting the cause of action asserted by the first amendment, so as to retain it before the court as such. The effect of the first amended petition upon that cause of action was the same as if a nonsuit had been entered. In other words, the statute commenced to run when the money became due, and continued to run until the filing of the second amended petition. From the allegations in this second amended petition, it affirmatively appears that about eight years had elapsed between the accrual of the cause of action and the filing of the amendment. Therefore the Supreme Court sustained the plea of limitation.
We do not think that the cause asserted in the instant case was upon two causes of action. All three suits, as stated in the original opinion, were brought by the corporation, but in the second amended petition the plaintiff alleged that the beginning of the negotiations between plaintiff and defendant were made at a time when a partnership existed, and that subsequently the two partners, together with their brother, organized and formed the corporation. We think that the tWQ eases present a state of facts entirely different from the case cited.
Appellee also urges that we erred in overruling appellee’s third assignment of error, and that we erred in holding that in a collateral attack there can be no challenge as to the illegality of the formation of a corporation on account of there being no statutory provision authorizing such a corporation to be formed. Appellee admits that, where there is a de facto or ostensible corporation, any irregularities in the incorporation thereof cannot be raised in a collateral proceeding, but that there is always a question of what constitutes a de facto corporation, and that this corporation was neither a corporation de jure or a corporation de facto. He cites 14 Corpus Juris, 214, where it is said the general rule is that there is a de facto corporation so that the legality of its corporate existence cannot be attacked collaterally where (1) there is a special act or general law under which a corporation may lawfully exist; (2) a bona fide attempt to organize; (3) actual user. Actual user means the actual enjoyment of a thing or the actual enjoyment of a privilege. 3 Bouvier’s Law Dictionary, p. 3380. The quotation from Corpus Juris used, under subdivision 3, “actual user or exercise of corporate powers in pursuance of such law and attempted organization.” Certainly there was an attempted user of the corporate powers in the instant case, and we hold that its corporate existence was not subject to collateral attack.
The case of Hunt v. Atkinson, 12 S.W.(2d) *786142, 145, by the Commission of Appeals and approved by the Supreme Court, was a suit for mandamus by G. O. Hunt and others against Norman Atkinson, county judge of Harris county, and the city of Houston. The court said: “Having determined that article. 1265 prescribes the only method whereby the city of Houston is authorized to extend its boundaries to include territory such as that in controversy, we come to consider whether or not the rule forbidding collateral attack upon existing corporations is applicable. The rule itself is well recognized and rests upon the soundest public policy. But an examination of the numerous cases supporting it will show that it applies only in those instances 'where the corporation attacked is at least a de facto corporation by virtue of an attempted organization under ‘color of law.’ A corporation, for the existence of which de jure there is no law, cannot be a de facto corporation; and its existence may be attacked directly or collaterally, or even ignored since it is in law nothing. It affords no rights and presents no defenses at any time, or as to any person. See Empire Mills v. Alston, etc., Co. (Tex. App.) 15 S. W. 200; Lum v. City of Bowie (Tex. Sup.) 18 S. W. 142; Parks v. West, 102 Tex. 11, 111 S. W. 726. Before an attempted organization can be said to be under ‘color of lqw,’ there must have been a good-faith attempt to organize in the method prescribed by existing law, and at least a color-able compliance with that law. McLeary v. Dawson, 87 Tex. 524, 29 S. W. 1044; Allen v. Long, 80 Tex. 266, 16 S. W. 43, 26 Am. St. Rep. 735; Finnegan v. Noerenberg, 52 Minn. 239, 53 N. W. 1150, 18 L. R. A. 778, 38 Am. St. Rep. 552; 14 C. J. 217, § 225. Where such attempt is made and the concern functions in the manner usual to such corporations, it becomes a corporation de facto, if not de jure, whatever the irregularities in the method of pursuing the statutory authority. This distinction abundantly appears from an examination of the authorities forbidding collateral attacks upon corporate existence, and to cite authorities would be to catalogue those numerous decisions.”
The appellee did not quote all that was said and especially that part which stated: “Where such attempt is made and the concern functions in the manner usual to such corporations, it becomes a corporation de facto, if not de jure, whatever the irregularities in the method of pursuing the statutory authority.”
We think that the opinion cited sufficiently answers the question raised by appellee on original hearing and in the motion for rehearing.
It is also urged that we erred in our original opinion in overruling appellee's second cross-assignment of error, and in holding that, where a brokerage contract for the sale of land is assigned or delegated or transferred to a corporation, the question cannot be raised in a collateral attack. We think we have sufficiently answered that objection in our original opinion.
The motion for rehearing is overruled.