Court Opinion

ID: 9777270
Source: CourtListenerOpinion
Date Created: 2023-08-29 20:05:20.037852+00
Date Added: 2024-06-11T07:32:51.249496
License: Public Domain

On motion for rehearing
Mr. Justice Calvert
delivered the opinion of the Court.
Texas Company’s motion for rehearing points up some in*509accuracies in our opinion on original submission which should be corrected.
1. The opinion recites that it was “admitted that Breeding was acting as agent of Texas Company” when he took the quoted conveyance from Duval. The statement is immaterial to the decision and is withdrawn.
2. In connection with our discussion of the liability of Texas Company for interest before judgment as damages we made the following statement: “Under any view of the matter Texas Company knew the amount of the net proceeds from the sale of the oil and gas produced from the land.” Complaint is made that “the record contains no evidence indicating that a sale of such oil was made.” The statement is not material to our holding that Texas Company is liable for interest before judgment as is made clear by our approval of the rule laid down in Watkins v. Junker, 90 Texas 584, 40 S.W. 11, that interest as damages is recoverable as a matter of law when the principal damages are fixed by conditions existing at the time the injury is inflicted. The good faith of Texas Company in converting the 14/16ths of the oil and gas to its own use, the reasonable market value of the oil and gas, and the reasonable cost of producing the same, were fixed by conditions existing at the time of the conversion and liability for interest as damages would follow as a matter of law.
3. We were in error in inferring that the only item on which interest was disallowed in Keystone Pipe and Supply Co. v. Zweifel, 127 Texas 392, 94 S.W. 2d 412, was “an item which was the subject of a continuing tender.” A re-examination of the opinion of the Court of Civil Appeals (60 S.W. 2d 1065) and the opinion of this court in the Zweifel case, as well as an examination of the record in that case on file in this court, discloses that there was another item of damages, not the subject of a tender, on which this court disallowed a recovery of interest as damages. However, there was no contention before this court or the Court of Civil Appeals that the interest should be disallowed because the principal damages were unliquidated. Neither party briefed that question. Neither Watkins v. Junker, supra, nor Ewing v. Wm. L. Foley, Inc., 115 Texas 222, 280 S.W. 499, 44 A.L.R. 627, nor any of the other cases cited in our original opinion on this issue, were called to the attention of the court. This court’s statement that the “value of the pipe was unliquidated and a matter of proof” as a basis for denying interest as damages was a gratuitous statement and was supported by *510the citation of no authority. It was contrary to the well-reasoned rule of Watkins v. Junker which had been followed in many other cases prior to the Zweifel decision (as an example see Simmonds v. St. Louis, B. & M. Ry. Co., 127 Texas 23, 91 S.W. 2d 332, 335) and has been followed in many others since that decision. (For example see Texas & N. O. Ry. Co. v. Dingfelder & Balish, 134 Texas 156, 133 S.W. 2d 967). A glance in Shepard’s Southwestern Citator shows that the Watkins case has been cited on the point in more than fifty cases, many of which we have examined and found to be in harmony. We cannot recognize the statement in the Zweifel case as binding authority for abandoning the rule of the Watkins case.
Many cases from other jurisdictions are cited for the proposition that the allowance of interest as damages is discretionary with the trial court, particularly in equity actions. No Texas cases in point are among those cited. Jones v. Mitchell, Texas Civ. App., 47 S.W. 2d 371, writ refused, was a true accounting suit following the dissolution of a partnership of twenty-three years duration. In Ingham v. Harrison, 148 Texas 380, 224 S.W. 2d 1019, interest as damages was denied because tender was made on the due date and rejected. Many cases could be cited from other states for the proposition that interest as damages is recoverable as a matter of right. See collation of cases in 96 A.L.R. 18, et seq., and 36 A.L.R. 2d 337, et seq.
This case well illustrates the wisdom and the justness of the rule laid down in Watkins v. Junker, supra. Texas Company has converted to its own use and benefit the 14/16th of the oil and gas which was the property of the State of Texas. The oil and gas had a market value at the time it was converted. The reasonable cost of producing it was also fixed at that time. To the extent of the difference between these two items it has had the use of the State’s money. As a good faith trespasser it has been permitted credit for its expenditures in producing the oil and gas, according to its own records. We can perceive of no reason for holding that because it was a good faith trespasser it should also have the free use of the State’s money. Texas Company has been made whole by giving it credit for all it expended. In addition it retains whatever profit it may have relized from the conversion of the oil and gas. The State can be made whole only by allowing it a recovery of interest on the net money value of its property. That it was necessary to require an incidental accounting to arrive at the principal sum due the State is no reason for permitting Texas Company to have the free use thereof or for denying the State a recovery *511of interest thereon. Public Market Co. of Portland v. City of Portland, 171 Ore. 522, 138 P. 2d 916, 918.
4. Texas Company’s points of error complaining of the judgment of the Court of Civil Appeals in failing to award it damages for breach by Duval of the warranty of title to the l/16th of production purchased from Duval were overruled on the ground that this right of recovery was waived by failure to present such points of error in the Court of Civil Appeals. Texas Company asserts there was no occasion for presenting such points of error in the Court of Civil Appeals since its prayer for recovery of such damages was upon the condition that the State should be awarded judgment against Texas Company for the value of the 1/16th, a condition which did not occur in the trial court.
It may be correct to say that the right of Texas Company to complain of this matter arose only under the judgment of the Court of Civil Appeals which decreed to the State a recovery against Texas Company of the value of this l/16th. If that be correct, then the right of Texas Company to complain was lost when this court reversed the judgment of the Court of Civil Appeals on this phase of the case and affirmed the judgment of the trial court. On this phase of the case the judgment of this court is the same as the judgment of the trial court. If Texas Company had a right to complain of the trial court’s judgment, it waived that right. If it had no right to complain of the trial court’s judgment, it has no right to complain of this court’s affirmance of that judgment.
All assignments of error briefed on motion for rehearing have been carefully considered, and being convinced that the judgment heretofore rendered is correct, the opinion is corrected as herein set out and the motion for rehearing is overruled.
Opinion delivered July 13, 1955.