Pereira v. Gulf Electric Company

343 S.W.2d 334, 1960 Tex. App. LEXIS 1913
CourtCourt of Appeals of Texas
DecidedDecember 29, 1960
Docket3783
StatusPublished
Cited by14 cases

This text of 343 S.W.2d 334 (Pereira v. Gulf Electric Company) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Pereira v. Gulf Electric Company, 343 S.W.2d 334, 1960 Tex. App. LEXIS 1913 (Tex. Ct. App. 1960).

Opinion

McDONALD, Chief Justice.

The principal question in this case is whether the Trial Court correctly found and enforced a Mechanic’s and Material-man’s lien against a tract of land on which was constructed a dwelling house. Parties will be referred to as in the Trial Court or by name.

McCaine Development Company, (whose principal officers were J. M. McCaine and Edward Keeton), built the house involved in this case. Such house was completed prior to 15 August, 1956, and McCaine Development Company was in possession of the property at all times material to this *335 case up to 31 October, 1956. Pereira Plumbing Company and Security Lumber Company furnished labor and materials for such house for which they were not paid. Gulf Electric Company (one of whose officers was Ernest Keeton), furnished labor and material for the electrical work for such house, and they were not paid.

On 13 June, 1956, McCaine Development Company deeded the property to John Pereira, Jr. and Allen Showers, Trustees for benefit of Pereira Plumbing Company and Security Lumber Company (in satisfaction or security of moneys owed to them). Such deed was held by Trustee Showers (attorney for McCaine Development Company) until 9 October, 1956, when same was filed for record.

On 4 October, 1956, Gulf Electric Company filed its Materialman’s and Mechanic’s lien in the amount of $4,346.35, for record.

On 31 October, 1956, Trustees Pereira and Showers sold the property to Crawford C. Jackson. When sale was made to Jackson, $5,000 was withheld from the purchase price, and held in escrow by American Title Company, until Gulf Electric Company’s lien could be released of record by judgment or payment.

This suit was filed on 19 December, 1957, by Pereira Jr., Trustee, Crawford C. Jackson, Security Lumber Company, and Pereira Plumbing Company, as plaintiffs, against Gulf Electric Company, McCaine Development Company, Edward Keeton, J. M. McCaine, and Ernest Keeton, as defendants, as a suit to quiet title to the property in Jackson, and for cancellation of the record lien in favor of Gulf Electric Company. (Such suit was in 2 counts: 1) conventional trespass to try title; 2) for cancellation of the mechanic’s lien of record on the ground that such was false, fraudulent, and fictitious by reason of the facts).

Defendants were all served with citation. McCaine Development, J. M. McCaine and Edward Keeton filed no answer and from the record it appears that they are insolvent. Gulf Electric and Ernest Keeton answered by a plea of Not Guilty, various denials, and filed cross action on 13 August, 1958 against the original plaintiffs, McCaine Development, J. M. McCaine, Ernest Kee-ton, and American Title Guaranty Company, asserting an indebtedness against McCaine Development (J. M. McCaine and Edward Keeton), for $4,346.65 for the electrical work on the house, and mechanic’s and materialman’s lien for such amount on the premises. Gulf Electric and Ernest Keeton as cross plaintiffs, prayed for judgment in the sum of $4,346.65, and for the foreclosure of said lien. Pereira, Trustee, Jackson, Security Lumber, and Pereira filed denials; American Title Guaranty Company filed a pleading stating that it was a stakeholder as to the $5,000, and prayed for $250 attorney’s fees, and instructions as to whom to deliver the $5,000. McCaine Development, Edward Keeton, J. M. McCaine were never served and entered no appearance in the case.

Trial was to a jury which found:

1) Gulf Electric and McCaine Development entered into an agreement under which Gulf Electric was to furnish labor and materials to be used in construction of the house here involved.

2) As a part of such agreement, indebtedness for such labor and materials should become due when the house sold, but no later than 15 August, 1956.

3) On 4 October, 1956, McCaine Development Company was indebted to Gulf Electric Company for such labor and materials furnished.

4) Such indebtedness amounted to $4,-346.65.

The Trial Court, on 11 Jcmuary, 1960, rendered judgment on such verdict for Gulf Electric on its cross action for $4,346.-65, and in addition, $779.54 as interest at the rate of 6% from 1 January, 1957; decreed that Gulf Electric’s lien was a paramount lien on the property; decreed that American Title Guaranty deliver the $5,000 (less *336 $250.00 for attorney’s fees) in its possession to Gulf Electric; decreed that Jackson owned the property subject to Gulf Electric’s lien; and decreed foreclosure on the property to satisfy some $376.19 remaining unsatisfied and due Gulf Electric.

Original Plaintiffs and Cross Defendants, Pereira, Jr., Trustee, Jackson, Security Lumber and Pereira Plumbing Company appeal, contending:

The Trial Court committed fundamental and reversible error:

1) In decreeing foreclosure in favor of Gulf Electric for its alleged debt when McCaine Development Company, J. M. McCaine, and Edward Keeton were not served and were not before the court.

2) In rendering judgment when the alleged debt and purported lien were barred by the Two Years Statute of Limitations.

3) In permitting Gulf Electric to recover $779.54 interest.

4) In not submitting certain special issues requested by them.

5) In rendering judgment when the undisputed evidence shows the electric materials and labor were charged to Edward Keeton and not the McCaine Development Company.

We revert to Cross Defendants’ (Appellants’) 1st contention. Appellants here assert that a lienholder cannot waive personal judgment against the creators of a lien on real property, (who have subsequently transferred the property), and proceed directly “in rem” against the property. The law does not require the inclusion of the landowner who has entered into a contract for improvements, and later divests himself of all title, to be made a party to an action to foreclose such lien. It is not mandatory to secure a personal judgment before obtaining a judgment of foreclosure against the property involved. One holding such a lien has the right to elect to seek personal judgment and foreclosure, or to elect to rely on an “in rem” proceeding subjecting only the security as payment of the debt. This was done and properly so. A former owner is a proper party, but is not a necessary party in such an “in rem” proceeding. See: Hartfield v. Greber, Tex.Com.App., 207 S.W. 85, opinion adopted; Sterling National Bank & Trust Co. v. Ellis, Tex.Civ.App., 75 S.W.2d 716, W. E. Dis.; Knott v. Mount, Tex.Civ.App., 103 S.W.2d 1060 no writ; Pennoyer v. Neff, 5 Otto 714, 95 U.S. 714, 24 L.Ed. 565.

Appellants’ 2nd contention is that the debt and purported lien were barred by the 2 Year Statute of Limitations. The debt was due not later than 15 August, 1956. Cross Plaintiffs’ cross action was filed on 13 August 1958.

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Bluebook (online)
343 S.W.2d 334, 1960 Tex. App. LEXIS 1913, Counsel Stack Legal Research, https://law.counselstack.com/opinion/pereira-v-gulf-electric-company-texapp-1960.