HENDERSON, Circuit Judge:
Reliance Insurance Company (hereinafter referred to as "Reliance") was the surety on a statutory bond in the sum of $500,000.00, on which American Grain and Cattle, Inc. (hereinafter referred to as "American") was principal. The bond was procured by American in compliance with Texas licensing requirements for public grain warehouse facilities. Texas Grain Warehouse Act, Tex.Rev.Civ.Stat.Ann. art. 5577b (Vernon) (Supp.1977) (current version...
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