Summary of Producers Lumber v. Olney Bldg. Co, Court of Civil Appeals Texas (1960)
Facts: Producers brought suit to recover damages for demolishing the dwelling property situated on Lot 8. Lot 8 was owned by Orts, who executed warranty deed to Producers for consideration of $1,428, Feb 1956. Feb 1958 Orts and Elliot began construction of 9 homes, one on Lot 8. Orts checked with his secretary as to whether Lot 8 had been sold and was informed negatively. April 1, 1958 construction began. A title search April 14, 1958 unearthed the true owner, of Lot 8, as Producer. The house was almost complete without the knowledge or consent of the legal owner and against their wishes. Orts and Montgomery tried to settle to no avail. Orts broke off negotiations and sent his crew to demolish the house which they did. Orts admitted to such during discovery.
Legal Issue: Whether the building on Lot 8 was done in good faith, and whether the destruction is compensable?
Holding: The building was not done in good faith when the builder trespasses and destroys the building.
Rule: If the building upon the land of another was done in good faith the court will issue equitable relief. When a person erects upon the land of another without knowledge or consent the building belongs to the owner of the land, the builder is without remedy. IF the builder trespasses onto the land and destroys the building he commits waste.
Procedure: Jury awarded 300 in specials and 600 in general. Amended to include $5,000, the stipulated value of the dwelling, as amended the judgment will be affirmed.
Court Rationale: The builder admitted to the destruction of the dwelling resulting from his mistake. The builder claimed good faith, but after the destruction the builder has unclean hands and has committed waste. He cannot prevail claiming improvement in good faith, because of his malicious destruction of the dwelling.
Plaintiff: The builder entered the land without permission and built a dwelling without permission, then re-entered and destroyed the dwelling without permission.
Defendant: Producers should only be able to recover for the damage to the lot, not to a house they did not possess title and does not exist.