author: HUFF, C. J.

text:
    MEDLIN v. COMMONWEALTH BONDING & CASUALTY INS. CO.

    (No. 484.)
    (Court of Civil Appeals of Texas. Amarillo.
    Feb. 7, 1914.
    Supplemental Opinion April 4, 1915.)
    1. Judgment @=3427 — Suit to Set Aside— Grounds fob Belief.
    That the judgment defendant failed to appear and present a meritorious defense in reliance on 'an oral agreement between the attorneys that the case should be postponed, and the court adjourned without any opportunity being afforded to file a motion to set aside the judgment at that term, was grounds for equitable relief, even though the trial court could not have been required to enforce an oral agreement for postponement, especially where an agreement to change the venue, dependent on the agreement for a postponement, was reduced to writing and duly signed and forwarded to the clerk, but not received by him until after the court adjourned.
    [Ed. Note. — For other cases, see Judgment, Cent. Dig. §§ 805-807; Dec. Dig. @=*427.]
    2. COBPOBATIONS @=?80— STOCK SUBSCEIPTION — Bepbesentations — Sufficiency op Evidence.
    Evidence, in a suit to set aside a judgment; canceling a note and deed of trust given as part of a stock subscription, held to show that the subscription was not procured by representations that the proposed corporation would loan the subscriber $50,000, or that the purpose of its organization was to make such loans.
    [Ed. Note. — For other cases, see Corporations. Cent. Dig. §§ 244, 246-264, 1407, 1407%; Dec. Dig. @=380.]
    3. COBPOBATIONS @=83 — STOCK SUBSCEIPTION
    —Avoidance of Liability — Gbounds.
    A subscriber to the stock of a corporation to be organized under the laws of Texas, with a certain amount of paid-up capital stock, may avoid his liability on the subscription contract, where the company is incorporated under the laws of Arizona with a less paid-up capital than that agreed upon, unless he has waived, or by his conduct estopped himself from relying on, such conditions of his subscription contract.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 328-336; Dec. Dig. @=83.]
    4. COBPOBATIONS @=8l — STOCK SUBSCEIPTION Contbact — Waives of Conditions.
    Where a subscriber to the stock of a corporation to be organized under the laws of Texas, with a paid-up capital stock of $200,000, on being notified of a stockholders’ meeting to be held to determine under what state law the corporation should be organized, appointed a representative, who acted for him at the meeting, at which it was determined to incorporate under the laws of Arizona with less than $200,000 of paid-up capital stock, and thereafter accepted an agreement by the new corporation as chartered under the laws of Arizona to underwrite real estate loans to be made by him, he waived the conditions of his subscription contract as to the law under which the corporation should be organized and the amount of paid-up capital stock.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 266-284; Dec. Dig. @=81.]
    5. COBPOBATIONS @=329 — LEGALITY OF INCOB-pobation — Collateral Attack by STOCKHOLDER.
    A corporation cannot be attacked collaterally by a stockholder upon call for payment of stock subscriptions.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 77-79, 2504; Dec. Dig. @=29.]
    6. COBPOBATIONS @=391 — STOCK SUBSCEIPTION —Note and Deed of Trust — Validity.
    A note and deed of trust, given as part of a subscription to the stock of a corporation to be organized and to secure its payment on call, were not void on the ground that they were given in payment of stock.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 365, 366; Dec. Dig. @=91.]
    Appeal from District Court, Hemphill County; B. M. Baker, Special Judge.
    Suit by the Commonwealth Bonding & Casualty Insurance Company against L. L. Medlin. From judgment for plaintiff, defendant appeals.
    Affirmed.
    Jas., A. Stephens, of Benjamin, H. E. Hoover, of Canadian, and J. T. Montgomery, of Wichita Falls, for appellant. Capps, Cantey, Hanger & Short, and Stephens & Miller, all of Ft. Worth, and Cooper, Merrill & Lumpkin, of Houston, for appellee.

      Writ of error pending in Supreme Court.

   HUFF, C. J.

This suit was instituted originally in the district court of Hansford county, Tex., by the appellee, Commonwealth Bonding & Casualty Insurance Company, against the appellant, L. L. Medlin, to set aside a judgment rendered in the district court of Hansford county, on the 16th day of April, 1912, in the case of L. L. Medlin against the Commonwealth Bonding & Casualty Insurance Company, numbered on the docket 112. By agreement of all parties the venue was changed from Hansford county tc Hemphill county, and a judgment rendered in that court on the 28th day of January, 1913, canceling and setting aside the judgment obtained by appellant in cause No. 112. The appellee, in his petition to set aside and cancel the judgment, set up in effect that the judgment was obtained through fraud on the part of appellant, in that, prior to April 16, 1912, which was appearance day of the district court of Hansford county, appellant, acting by and through his attorney, L. W. Dalton, and the appellee entered into an agreement and understanding, by the terms of which it was agreed that said cause would be passed until the 18th or 19th day of April, 1912. Appellant disregarded said agreement, and, without notice to appellee, after he had acknowledged that said agreement was made, procured the court to overrule the appellee’s plea of privilege to be sued in Tarrant county, Tex., and thereupon took a judgment by default against appellee for the sum of $645, and canceled the note for $4,375, as well as a deed of trust given to secure the same, together with a certain contract of subscription for stock in the appellee company and the cancellation of certificate of stock in said company, and further setting up the fact that it had a meritorious defense to appellant’s alleged cause of action, setting out in detail the defense thereto.

It will be impossible for us to set out the pleadings iaDjything like in full, as they cover over 50 pages of the record in this case. A recitation of the facts will sufficiently designate the issues presented in the court below and in this court. The case was tried in the court below before the judge without the intervention of a jury, who rendered judgment for appellee, therein setting aside the former judgment, and he did not file findings of fact and conclusions of law, and the case is before us alone upon the statement of facts.

The appellant brought suit in the district court of Hansford county, in the spring of 1912, by which he sought to cancel a certain note for $4,375, a deed of trust, and to recover the sum of $645, paid, and .to cancel the subscription contract and certain stock certificate, issued by said corporation for 125 shares, alleging a number of grounds .for such cancellation, among others that one 0. S. McDonald, acting for himself and as co-conspirator with appellee company, made to the appellant false and fraudulent representations that all of the stock in the then proposed corporation had been sold and paid in; and that said company would be organized and in the business of loaning money and discounting the notes to stockholders within a short time; and that they had about $800,-000 ready to loan on application as soon as the charter was procured, and that plaintiff would be able to procure a loan of $50,000 from said corporation, said loan to be made upon interest at the rate of not to exceed 7 per cent, per annum; and that said company or corporation then had arrangements made by which they would have on hand money to make the loan of $25,000 to plaintiff — further alleging that he subscribed to the stock on the condition that it was to be a Texas corporation, and that its charter was to be obtained in Texas, under the laws of the state, but instead thereof that it was organized under the laws of the territory of Arizona, and for a different purpose than that which had been represented to him it would be organized, and that under its organization it was not authorized to loan money, etc.

The Hansford county district court convened on the 15th day of April, 1912, and on that day the appellee insurance company filed its plea of privilege to be sued in Tar-rant county. On the 16th day, which was appearance day, appellee was not present in person or by any representative or attorney, and the appellant, Medlin, took judgment, the court finding against, the plea of privilege filed by appellee and rendering judgment by default, canceling the note, deeds of trust, etc.

The petition of appellant in cause No. 112, was signed by James A. Stephens and L. W. Dalton, as attorneys for appellant, who were in fact the attorneys representing appellant in that cause. The facts warranted the court in finding that in the week previous to the convening of the district court of Hans-ford county, R. T. Stuart, vice president of appellee company, entered into an agreement with L. W. Dalton, to pass the case until Friday of the first week of court, some time, either the 18th or 19th of April. This agreement was effected by Stuart wiring Dalton that he desired to get in communication with him over the long-distance phone, and which resulted in Dalton and Stuart over the phone agreeing to pass the case until the 19th of April, in order that they might settle or compromise the case. Dalton made the agreement, provided his associate counsel, Jas. A. Stephens, would consent. He phoned Stephens of the proposed agreement to pass the case and the object for passing it, and Stephens said that it would be all right, and op receiving Stephens’ assent, Dalton made the agreement to pass the case, and confirmed the agreement by letter to Stuart, dated April 13, 1912, in which it was stated substantially that the case would be passed until Friday, and that if the court should not last sufficient length of time, or for any reason they could not get a trial at that court, then the venue should be changed to Lipscomb county. It seems, also, that L. W. Dalton wrote a letter to Judge F. P. Greever, the presiding judge of the court, that they had entered into an agreement to postpone the case until April 19th, and that if the court should adjourn before the case could be tried, they agreed to change the venue to Lipscomb county. Judge Greever being unable to preside over the court, Judge W. D. Fisher was selected to preside during that term. Dalton, learning of that fact, wrote a letter to him on the 15th, stating that he had written to Greever about the case being postponed, but it appears this letter was received after judgment was taken, and after the court adjourned. The business for the term of the Hansford court was disposed of by the 16th of April, on appearance day, and, no other business appearing after the judgment was taken, the court adjourned. Mr. James A. Stephens was present at that court, and insisted upon taking the judgment. It also appears that an agreement was made, signed by Dalton, that the venue should. be changed to Lipscomb county, but it did not reach the hands of the district clerk until after the adjournment of the court. The facts warranted the trial judge in finding that the agreement between Dalton and tbe representatives of tbe appellee Corporation were entered into in good faitb and bona fide, and that appel-lee, relying on the agreement made with Dalton, did-not, by representative or otherwise, appear on appearance day.

The facts upon which the appellee founded its defense against 'appellant’s alleged cause of action are substantially that C. S. McDonald, acting as agent for Stuart, Hark-rider & Co., sold to the appellee 125 shares in the proposed corporation, and obtained appellant Medlin’s application to purchase said stock. McDonald substantially told Medlin that the corporation would be a Texas corporation. McDonald told Medlin that practically $1,000,000 of the stock had been sold, and that the company would be incorporated under the laws of Texas. The representations made by McDonald were that:

“The insurance company would, at its option, either handle or become the guarantors for purchasers of capital stock at least 10 times as much negotiable real estate securities as he had capital stock, at a rate of interest not to exceed 1 per cent, more than the money actually cost them; that is the statement I made to Mr. Medlin, and the contract, I understand, was delivered to Mr. Medlin to this effect.”

The contract signed by Medlin is as follows :

“Commonwealth Bonding & Accident Insurance Co.
“Capital $10.00. Surplus $30.00.
“Subscription to Capital Stock.
“No. 1475. J — 68.
“Whereas, the Commonwealth Organization Co. of Ft. Worth, Texas, are promoting the organization of the Casualty Bonding & Accident Insurance Company, to be incorporated in pursuance of the laws of the state of Texas, under the name of Commonwealth Bonding & Accident Insurance Company, or such other name as may be selected, with an authorized capital stock of $300,000.00, _ and paid-up capital of at least $200,000.00, paid up and free from organization expenses, all in accordance with the printed prospectus issued by them and delivered to me; and, whereas, by their acceptance of this subscription', said Commonwealth Organization Co. agree to endeavor with all reasonable diligence to accomplish on or before December 31, 1910, the organization of said corporation with capital stock fully paid as aforesaid, they to defray all expenses of the organization and incorporation: Now, therefore, I do hereby subscribe for 125 one-tenth shares of the par value of $10.00 each, of the capital stock of said Commonwealth Bonding & Accident Insurance Company and agree with the said company and the said Commonwealth Organization Company to pay therefor the sum of $5,000, as follows: The sum of$4,375.00 I agree to pay in money or securities satisfactory to the insurance department with six per cent, interest to said Commonwealth Bonding & Accident Insurance Company or its trustees at Ft. Worth, Texas (which goes to capital and surplus), at any time after November 1,' 1910, immediately upon receipt of notice from said Commonwealth Organization Company that its capital stock has been subscribed in good faith in amounts and at rates netting the company at least $200,000, with capital in the aggregate when paid. The remaining sum of $625.00 I agree to pay and do pay concurrently with this subscription to the said Commonwealth Organization Company, in consideration of their agreement hereinbefore recited and in lieu of any further or othef contribution to expense of organization incorporating said company. No conditions, representations or agreements other than those printed herein shall be binding on the Commonwealth Organization Company or the Commonwealth Bonding & Accident Insurance Company.
“Witness my hand this the 12th day of December, 1912.
“L. L. Medlin, Name of Subscriber. “Witness: C. 8. McDonald.” ■

Tbe Commonwealth Organization Company appear to have delivered to subscribers for stock the following contract:

“Memorandum of agreement this day entered into by and between the Commonwealth Organization Company fiscal agents for the Commonwealth Bonding & Casualty Insurance Company of Ft. Worth, Texas, party of the first part, and - of -, party of the second Dart withesseth: That the party of the first part hereby agrees and guarantees to the party of the second part for the consideration of his subscription to the capital stock of the Commonwealth Bonding & Casualty Insurance Company, to the amount of $-, and for the full payment of said subscription agrees with the party of the second part to handle for him or become his guarantor at first party’s election on negotiable real estate paper to the amount of at least ten times the amount of his subscription at the current rate of interest that can be secured at the time of the loan through Eastern or Western capital, with an additional one per cent, per annum for securing or guaranteeing such loan. Said paper to be secured by real estate to be worth at least double the amount of the loan, and subject to the approval of the finance committee. Said party of the first part agrees and guarantees to secure for the party of the second part a duplicate of this contract with the Commonwealth Bonding & Casualty Insurance Company within thirty days after the organization is in full force and effect. All expenses for securing said loan to be paid by the party of the second part. No statements or agreements other than printed in this contract shall be binding on the Commonwealth Organization Company or Commonwealth Bonding & Casualty Insurance Company.
“This contract is made in duplicate, etc.
“Commonwealth Organization Co.

The following agreement was introduced in evidence:

“Memorandum of agreement, this day entered into by and between the Commonwealth Bonding & Casualty Insurance Company, with offices at Ft. Worth, Texas, party of the first part, and L. L. Medlin, party of the second part, witness-eth: Whereas, party of the first part hereby agrees and guarantees to the party of the second part for and in consideration of $1.00 in hand paid, the receipt of which is hereby acknowledged, to handle for him or to become his guarantor at the first party’s election, on negotiable real estate paper to the amount of $50,000, at the current rate of interest that can be secured through Eastern or Western capital, with an additional one per cent, per annum for securing or guaranteeing such loan; said papers to be secured by real estate to be worth at least double the amount of the loan and subject to the approval of the finance committee. All expenses for securing said loan to be paid by the party of the second part. This contract is made in duplicate.
“Witness our hands this the 27th day of June, 1911.”

The following letter was introduced in evidence, dated, Ft. Worth, Tex., March 8, 1911:

“Mr. L. L. Medlin, Hansford, Texas — Dear Sir: The Commonwealth Bonding & Casualty Insurance Company is now ready to file its charter and enter the field for business and to facilitate the execution of bonds in transacting business, as well as to cover some other features of a general casualty business, it is necessary to have a by-law passed, authorizing. the president or active vice president to appoint from time to time as the business of the company may demand, a resident vice president, resident assistant secretary and attorney in fact to represent and to act for and on behalf of the company. For this purpose and for the further purpose of deciding under what state laws this company shall incorporate a meeting of the stockholders is called by the president and executive committee to be held in the home office of the company in the Flat Iron Building at Ft. Worth, Texas, at ten o’clock a. m., on the 20th day of March, A. D. 1911. All stockholders are requested to be represented either in person or by proxy. Should it not be possible for you to be present, kindly sign one of the two forms of proxy which are inclosed herewith. One authorizes the name selected by the executive committee to act; the other is blank and can be filled in as you may elect. Morris H. Mills, Secretary.”

The following proxy was introduced, signed by Mr. Medlin:

“State of Texas, County of Hansford.
“Know all men by these presents that I, L. L. Medlin, do hereby constitute and appoint John Scarborough, H. B. Branham, and M. H. Mills, jointly and severally, my attorneys and agents for me in my name, place and stead, to vote as my proxy at any annual or special meeting of the stockholders of the Commonwealth Bonding & Casualty Insurance Company, for the election of directors and upon such other questions as may come before such annual or special meeting to the number of votes I shall be entitled to if then personally present. This proxy can be revoked or canceled at any time by giving written notice.
“In witness whereof I have hereunto set my seal this the 15th day of March, 1911.
“[Signed] L. L. Medlin.
“Signed in presence of F. B. Kennedy.”

On January 29, 1911, the following letter was written to L. L. Medlin:

“L. L. Medlin, Hansford, Texas — Dear Sir: We are now adjusting balance due from stockholders preparatory to filing our charter and as the necessary amount of stock has already been subscribed it is of the utmost importance that this matter receive prompt attention. . By return mail kindly indicate just how you desire to secure the deferred payment on your subscription. It will be our desire to conform with your wishes as far as the requirements of the state department at Austin will permit. As you perhaps know, our list of stockholders includes a large number of bankers, and successful business men, which should enable us to file our charter and be ready for business at an early date — not later than February 1st, we hope.
“Yours truly,
“Commonwealth Bonding & Casualty Ins. Co.
“By M. H. Mills, Secretary.”

The appellant introduced a certificate from B. L. Gill, commissioner of insurance and banking of the state of Texas, and the annual statement and affidavit as to the correctness of the same, of the Commonwealth Bonding & Casualty Insurance Company of Phmnix, Ariz., dated the 28th day of September, A. D. 1911:

Commonwealth Bonding & Casualty Insurance Company.
Organized under the laws of the territory of Arizona made to the commissioner of insurance and banking of the state of Texas, .pursuant to the laws thereof.
Incorporated March 23, 1911, Commenced business-.
Home Office -
(Street and number)
Phoenix, Ariz.
(City or town and state.) General Offices, Ft. Worth, Texas.
Officers.
President, John Scharbauer; secretary, Morris H. Mills; vice-presidents, Coke W. Hark-rider, R. T. Stuart; treasurer, H. P. B'ranham.
Directors: John Scharbauer, Morris I-I. Mills, H. P. Branham, Ooke W. Harkrider, R. T. Stuart, W. B. Harrison, L, T. Lester, J. D. Hagler, C. H. Boedeker.
I.Capital Stock.
1. Amount of capital paid up in
cash . $300,000 00
Extended at. $300,000 00
II.Income.
No business transacted. Total . $300,000 00
III. Disbursements.
Total disbursements.. Balance . $300,000 00
IV. Ledger Assets.
2. Mortgage loans on real estate, per Schedule B, First liens $113,975.00; other than first, $72,629.71. $186,604 61
3. Loans secured by pledge of bonds, stocks or other collat-erals, per Schedule 0 . 49,005) 00
4. Book value of bonds, $50,-000.00 . 50,000 00
6. Deposits in trust companies and banks not on interest... 9,352 89
7. Deposits in trust companies and banks on interest. 5,037 50
30. Ledger assets as per balance on page 3.$300,000 00
Nonledger Assets.
41. Notes .$290,696 54
43. Gross Assets.$590,696 64
V.Liabilities.
47. Capital actually paid up in cash . $300,000 00
48. Surplus over all liabilities.... $390,696 64
50. Total liabilities.$590,096.54
State of Texas, County of Tarrant.
Coke W. Harkrider, vice president, M. H. Mills, secretary, of the Commonwealth Bonding & Casualty Insurance Company, being duly sworn, each for himself deposes and says that they are the above-described officers of the said company, and that on the thirty-first day of December last, all of the above-described assets were the absolute property of the said company, free and clear from any liens or claims thereon, except as above stated, and that the foregoing statements, with the schedules and explanations therein contained, annexed, or referred to, are a full and correct exhibit of all the assets, liabilities, income, and disbursements and of the condition and affairs of the said company on the said 31st day of December last and for the year ending on that date, according to the best of their information, knowledge, and belief, respectively.
This company has in addition to capital stock shown in this statement, after paying all obligations, assets in the form of notes amounting to $290,606.64.
Coke W. Harkrider, President.
M. H. Mills, Secretary.
Subscribed and sworn to before me this the 26th day of May, 1911.
F. L. Kennedy,
Notary Public,
Tarrant County, Texas. [Seal.]
Certificate. State of Texas, Department of Insurance and Banking.
I, B. L. Gill, commissioner of insurance and banking of the state of Texas, do hereby certify that the instrument which is hereto attached is a true, full, and correct copy of certificate of authority issued to the Commonwealth Bonding & Casualty Insurance Company of Phoenix, Ariz., now on file in and forming a part of the records of this department.
In testimony whereof I have hereunto subscribed my name officially, and have hereon impressed my seal of office at the city of Austin, in the state of Texas, on this 28th day of September, A. D. 1911. B. L. Gill,
Commissioner of Insurance and Banking.
[Seal.]
Office of Commissioner of Insurance and Banking.
This is to certify that the Commonwealth Bonding & Casualty Insurance Company of Phcenix, Arizona, having complied with all requirements of law relating thereto, is hereby authorized to pursue the business of Surety, Fidelity, Liability, Guaranty, Plate Glass, Burglary, Theft, Steam Boiler, Accident and Casualty Insurance within this state for the year ending February 29, 1912.
In testimony whereof, I hereunto sign my name and affix my official seal, at Austin, Texas, this 13th day of June, 1911.
[Signed] B. L. Gill, Commissioner.

Article IX of the incorporation of the charter of appellee company is as follows:

Art. IX. — The largest amount of indebtedness for which the corporation is at any time to subject itself is $200,000.00 and the following certificate to the charter was offered:

“Territory of Arizona, Office of Territorial Auditor.
“United States of America, Territory of Arizona — ss.:
I, G. A. Mauk, territorial auditor of Arizona, do hereby certify the inclosed is a true and complete transcript of the Articles of Incorporation of the Commonwealth Bonding & Casualty Insurance Company and wore filed in this office on the 29th day of March, A. D., 1911, at 3:45 o’clock p. m., as provided by law.
“In testimony whereof I have hereunto set my hand and affixed my official seal. Done at the city of Phoenix, the capital, this the 16th day of October, A. D., 1911.
“G. A. Mauk, Territorial Auditor.”

Appellant introduced in evidence sections 767, 788, 789, and 797 of the Revised Statutes of the state of Arizona, as follows :

“767. (See. 7.) Every corporation organized under the provisions of this title shall file a copy of its articles of incorporation, certified to by the county recorder of the county where said articles are recorded, in the office of the secretary of the territory and have the same recorded by him in a book kept for that purpose. Such articles of incorporation must specify the highest amount of indebtedness and liability, direct or contingent, to which the corporation is at any time to be subject, which must in no case exceed two-thirds of the amount of the capital stock.”
“788. (See. 28.) If any insurance corporation is under liabilities for losses to an amount equal to its capital stock, and the president or directors, after knowing the same, make any new or further insurance, the estates of all who make such insurance or assent thereto are severally and jointly liable for the amount of any loss which takes place under such insurance.
“789. (Sec. 29.) No corporation shall be formed for the transaction of business in any kind of insurance except on live stock, without a subscribed capital equal to at least one hundred thousand dollars in United States gold coin, twenty-five per cent, whereof must be paid in previous to the issue of any policy, and the remainder by monthly or quarterly installments within twelve months from the day of filing the articles of incorporation. Nor shall any individual or person transact business as agent of any non-resident person or corporation, whether foreign or domestic, in any kind of insurance, except on live stock, unless such person or corporation possesses available cash assets, exclusive of stock notes, to the amount of at least one hundred thousand dollars in United States gold coin over and above all liabilities.”
“Laws of Arizona.
“Article III.
“Mutual Life, Health and Accident Insurance Oorporations.
“797. (Sec. 37.) Every corporation formed under the laws of this territory for the purpose of mutual insurance * * * to persons for life or any fixed period of time, or'to purchase and sell annuities, must have a capital stock of not less than one hundred thousand dollars. It must not make any insurance upon any risk or transact any other business as a corporation until its capital stock is fully paid up in cash, nor until it has also obtained a fund, to be known as a ‘guaranty fund,’ of not less than two hundred and fifty thousand dollars, as hereinafter provided. If more than the requisite amount is subscribed, the stock must be distributed pro rata among the subscribers. Any subscription may be rejected by the board of directors or the committee thereof, either as to the whole or any part thereof, and must be, so far as rejected, without effect.”

The appellant testified that McDonald represented to him that:

“When they got things on foot and got into business, their money was almost unlimited, and they would loan us $10 for every dollar we subscribed in stock. I had right-smart confidence in the fellow. I don’t know that I explained to him in that way that the object of my going into the company was cheap money. I said this to him, I know, that I had been wanting to get some one to stand to my back for some while. I remember that remark. I meant that, and he understood it that I would like to have things in shape to get money any time I wanted it, or needed it, and he represented that I could do that if I would take stock in this concern. That was the substance so far as I know of all that was said * * * Tes, I guess I did rely upon what McDonald told me the company would do and could do. He made his story stick pretty straight through. I am not sure that he told me about any particular amount of money that they had on hand, but more than enough money than he thought was needed. He told me about others that he had, and he thought he might be a little bit late. My recollection is that he had stock subscribed to about $800,000, and that I had to be in a hurry.”

In testifying about signing the proxy, the appellant stated:

“I expect the most likely way was I gave it to Mr. Branham on account of his being better acquainted. I saw him about that time at Ft. Worth, and I may have given him the proxy personally. I cannot say whether I did or not for certain. I cannot say as to that — I may have given it to him. I was with Mr. Bran-ham a day or two. In all probability if I sent it by mail I sent it to him. If he had asked for it there, I would have given it to him.”

1-Ie further testified:

“If I did give any one a proxy or authorize anybody to use my name with this company for which I subscribed stock might be chartered under the laws of Arizona, I do not remember it at all. The proxy Stuart showed me did, I think, authorize him to vote the thing as he saw proper in the matter of incorporating under the Arizona law; that is my recollection of it. I know I read it when Stuart showed it to me. I don’t believe I would have signed this proxy if I had known it was to incorporate under the laws of some state except Texas.”

He further states:

“I do not think I would have agreed to have been incorporated with a paid-up stock of $16,-000 or $17,000. Xcs, I think McDonald said something to me about a surplus fund they were going to create, but if he ever gave me the figures in regard to the surplus, or anything of that kind, I do not know.”

Appellant testified he was well acquainted with Mr. Branham, one of the parties named in the proxy, to whom he thinks he delivered the proxy, .and that he knew him well and had confidence in his honor and integrity, and regarded him as an honest man, knowing him more than 25 years. The assistant secretary, F. L. Kennedy, testified that he had since August 7, 1911, been in charge of the accounting department, and also had charge of the company’s assets, such as notes, etc.; that there were about $16,000 received in payment for the capital stock in said company on and prior to the 23d day of March, A. D. 1911; that there was paid in actual cash, for capital stock in said company, about $16,000 at that time; that the company did not receive any cash for the capital stock of its company prior to the 23d day of March, A. D. 1911, in actual cash as much as $25,000. About $75,000 in cash had been received to the present date in paying for the capital stock of said company. He testified that no actual cash had ever been loaned by the Commonwealth Bonding & Casualty Insurance Company, to its stockholders, but the notes taken in payment for stock have, at all times, been regarded as loans by this company, and so considered by the commissioner of insurance and banking of the state of Texas, as we understand it. The treasurer of the company testified:

“After the charter was obtained from the territory of Arizona, on the basis of the capital stock of $200,000, the authorities at Austin refused to give a permit to do business in Texas, unless the entire authorized capital of $300,-000 was paid. Our attorneys advised us that it would be right and legitimate for us to transfer from the surplus as much as was needed to make up the $300,000 capital, and this we did. The certificate of stock on a basis of $200,000 had already been issued, and up to the time I left the company the amount taken from the surplus, which was a little over $100,000 had never been issued and distributed. The reason why the stock was issued was because there was a difference of opinion as to the best disposition of it. The fact that it was a little over $100,-000 made it very difficult of distribution among the stockholders, and some of the directors, I among the number, thought it would be best to issue it to trustees and sell it to outside purchasers.”

The appellant, in his petition, sought to cancel the note executed February 1, 1911, and deed of trust executed February 24, 1911. The judgment canceling the note recites that the deed of trust executed on the 24th day of February, A. D. 1911, which was recorded in volume 4, Deed of Trust Records, was to secure a note executed February l, 1911, made by appellant to appellee, for the sum of $4,375.

The facts in this case show that Stuart, Harkrider & Co. were a partnership operating as the Commonwealth Organization Company, and that they solicited the subscriptions for stock from parties throughout the country; that some time previous to the incorporation of the appellee there were letter heads procured, representing that certain parties were presidents and certain parties directors and stockholders in the concern, but as a matter of fact no business of the corporation was transacted further than a short time before the organization certain of the subscribers to the stock took charge of the affairs to collect up the subscription or to secure the payment of the same, and in doing so were necessarily out some expense. Stuart, Harkrider & Co. were, according to some of the testimony, required to pay all the organization expenses, and such seems to be the terms of the contract of subscription, but a misunderstanding or disagreement between Stuart, Harkrider & Co. and the stockholders who took charge to organize the company after subscription resulted in the fact that the stockholders themselves proceeded to the organization of the company, electing their secretaries, treasurers, etc., and the letters written to the various stockholders were done by these parties under the informal organization of some of the stockholders.

Appellant assigns error to the action of the court in overruling special exceptions to the petition of appellee, to the effect that the alleged agreement to postpone the case, originally brought by appellant in the district court of Hansford county, until the 19th day of April, 1912, and after the appearance day of said court, was not alleged to have been in writing or made in open court and entered of record. We think if the agreement was made by appellant’s attorney to pass the case for trial to a day subsequent to appearance day, a judgment on appearance day, in violation of the agreement, would permit appellant to take advantage of his‘own agreement, and in law was a fraud upon appellee. Traveler’s Ins. Co. v. Arant, 40 S. W. 853; Thompson v. Railway Co., 31 Tex. Civ. App. 583, 73 S. W. 29. It certainly appears from tlie allegation of tlie pleading that at the time the judgment was taken appellant, as well as his attorneys, knew that the agreement had been made to pass the case until the 19th of April, 1912, and that for that reason the ap-pellees were not then in court to present their defense. The court having adjourned on that day, there was no opportunity offered appel-lee to file a motion to set aside the judgment at that term of the court. It is also alleged that an agreement was entered into to change the venue from Hansford county to Lipscomb county and reduced to writing, and signed by the attorney for appellant, and by the ap-pellee, and that the same was forwarded to the clerk of the district court of Hansford county, but was received after the court adjourned. We cannot set out all the allegations in the petition on this point, but believe under the facts as alleged it would be inequitable to permit the judgment to stand if the appellee otherwise alleged a meritorious defense, even though the rule did not require the trial court to enforce the agreement, if not in writing or made in open court. If, by reason of a verbal agreement thus made, appellee was deprived of the right to present its defense through the wrong or fault of appellant, a court of equity should, we think, set aside the judgment if the other necessary facts are alleged. We also think the facts sufficient in this case to support the judgment of the trial court in finding that appellee did not present its defense because of the fault of appellant and his attorneys, and that appellee was not negligent in the matter, and had the right, under the circumstances, to rely upon the promise and agreement of the attorneys to pass the case until the 19th and to rely upon the agreement to change the venue to Lipscomb county, without prejudice to its plea of personal privilege to be sued in Tarrant county, in ease a settlement of the case was not reached or the case compromised. Appellee’s assignments 1, 2, 4, and 5 are overruled.

The facts are sufficient to support the judgment of the court and the findings that appellant was not induced to subscribe for the shares in the proposed corporation by representations that it would loan to him $50,000 as a stockholder, or that the purpose of its organization was to make such loans. It appears from the evidence the proposition made by the promoters was that the company would underwrite real estate loans equal to 50 per cent, of the real estate value, which were to be approved by the finance committee, at a cost of 1 per cent, to the stockholder. There is no evidence that appellant ever requested the company to so' underwrite real estate notes, or that it had ever refused to do so for him.

Appellant, by signing the subscription contract, proposed to become a stockholder in the corporation to be formed under the laws of the state of Texas, with a paid-up capital stock of $200,000. Before participating in the organization, or if he did not waive such proposition, or by acts or by Ms conduct estop himself, he could avoid his liability on the subscription contract. It is doubtless true that by a failure to form the prospective corporation according to the terms of his subscription contract he would be entitled to recover back the money paid and cancel his subscription. The trial court, however, must have found that appellant waived the above provisions and remained a stockholder in the corporation, and was thereby estopped from canceling his subscription. The evidence in this case shows that the appellant was notified of the stockholder’s meeting at Ft. Worth, held for the purpose of determining under what state law they should incorporate. He appointed as his representative a man whom he had known for 25 years to act for him in the meeting. He thereafter accepted, the evidence indicates, an agreement by the new corporation as chartered under the laws of Arizona, to underwrite any real estate loan he might make at 1 per cent, on the amount. If his subscription contract should be treated as a conditional one, we think the conditions could be waived by him. Cook on Corporations, § 88 (6th Ed.). If the appellant subscribed with the understanding that there should be actually paid in $200,000 by the stockholders before the charter could be obtained, this provision could also be waived. Cook on Corporations §§ 181, 188; Karnpmann v. Tarver, 29 S. W. 1144; Olcott v. I. & G. N. Ry. Co., 28 S. W. 728, 10 Cyc. 399f. The appellant in this case having, through his agent, consented to incorporate under the laws of Arizona,, with a less paid-up capital than he formerly agreed ■ the corporation could be incorporated for, should not, it occurs to us, be permitted to recover from his associates, with whom he acted in forming the corporation, the money he paid therein, and also cancel his obligation to pay his stock subscription. This would take from the corporation the funds and obligations upon the faith of which third parties have dealt with the corporation.' It occurs to us that sound public policy ought not to permit one to participate in the organization of a corporation and then, after its organization, seek to withdraw the money he has placed in it because of the failure of the company to organize in the manner stipulated by some past agreement.

Appellant attacks the act of incorporating. Under the evidence in this case the corporation is a de facto corporation. We do not think the corporation can be attacked collaterally by a stockholder upon call for payment of stock subscriptions. A stockholder who subscribes for stock is not only estopped from setting up irregularities in the formation of a corporation, but he is also bound by the rule that the existence of a corporation cannot be inquired into except by direct proceedings in bebalf of tbe state. Cook on Corporations, §§ 183 to 186.

It is also asserted that tbe note and deed of trust is void because given in payment of stock. Tbe facts in tbis case do not warrant that conclusion. Tbe contract of subscription was given before organization, and tbe note and deed of trust were also executed before its organization. Upon call appellant was liable for his stock subscription. His note and deed of trust were a part of tbe subscription and to secure its payment upon tbe call. Tbe fact that other subscribers were required to secure their stock subscriptions evidenced the fact that the subscription was made in good faith. The fact that appellant gave bis note to evidence bis indebtedness created by such subscription and executed a deed of trust to secure it, we do not think, should relieve him from his obligation upon call. We are of the opinion that the evidence is sufficient to support the judgment of the court

The judgment is therefore affirmed.

Supplemental Opinion.

The attorneys in this case request us as a matter of justice to the attorney who took judgment in cause No. 112, mentioned in the original opinion, to find that he had only consented to postpone the case and did not agree to continue it. We simply find that it appears from the record that after Mr. Stephens talked with Mr. Dalton over the phone, he, Stephens, wired the appellee company, April 12, 1912, the following: “What is your offer to compromise in the Medlin case? If you want to settle it I will pass it but will not continue.”- This wire ap-pellee company did not answer but relied alone upon the agreement with Dalton. The. facts, we think, warranted the trial court in finding to the effect stated by us in our findings in support of the judgment
      @=»For other oases see same topic ana KEY-NUMBER in all Key-Numbered Digests and Indexes


source: Caselaw Access Project

author: WILLSON, O. J.

license: Public Domain

text:
    ARMINGER v. CITY NAT. BANK OF PARIS.
    (No. 1503.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 11, 1915.)
    Account Stated <&wkey;20 — Evidence — Question for Jury.
    In an action for damages for a breach of contract, where defendant counterclaimed, evidence held to warrant the submission of plaintiff’s claim to the jury, it not conclusively establishing an accounting by which plaintiff agreed to his liability.
    [Ed. Note. — For other cases, see Account Stated, Cent. Dig. §§ 9, 40, 94, 95, 97-99; Dec. Dig. <®=^20J
    Appeal from District Court, Lamar County; A. P. Doaoney, Judge.
    Action by Elmer L. Arminger against the City National Bank of Paris, which counterclaimed. From a judgment for defendant, plaintiff appeals.
    Reversed and remanded.
    October 30, 1912, appellee, while operating a box manufacturing plant in Paris, which, being a creditor of the bankrupt, it had purchased at the trustee’s sale of property belonging to the Paris Box & Lumber Company, bankrupt, contracted with appellant to sell and deliver to him on board the cars at Paris, on orders therefor to be made by him before May 1, 1913, 50 carloads of egg cases. Appellant, who was the plaintiff below, claimed that appellee after delivering 19 carloads of the cases as agreed upon, failed and refused to deliver the remaining 31 carloads thereof, to his damage in the sum of $2,480. He further claimed that in an accounting had between him and appellee in February, 1914, the latter agreed it was liable to him for said sum of $2,480, less $749, representing his indebtedness to it for cases it had delivered to him and then promised to pay him the sum of $1,731, the amount of his, said damages, less said sum of $749. The suit was to recover of appellee said $1,731. Ap-pellee denied that it had breached the contract as charged against it, or had promised to pay appellant said sum of $1,731 as charged by him, and alleged that in October, 1913, an accounting was had between it and appellant of the matters connected with the contract between them, and that it was then agreed that appellant was indebted to it in the sum of $749, which he promised to pay to it. By pleading in the nature of a cross-action appellee sought a recovery against appellant of said sum of $749. After hearing the testimony the trial court told the jury that appellee had failed to prove any breach of the contract by appellant, that the undisputed evidence showed that appellant was indebted to appellee in the sum of $749 and interest, and instructed them to find against appellant for said sum of $749 and interest. The appeal is from a judgment rendered on a verdict returned in accordance with said instructions.
    Wright & Patrick, of Paris, and Walter H. Eckert, of Chicago, Ill., for appellant. Park, Moore & Hardison, of Paris, for appellee.
   WILLSON, O. J.

(after stating the facts as above). We think the contention of appellant that the testimony made an issue for the jury as to whether, in an accounting had between him and appellee in October, 1913, it was found that he was indebted to appel-lee in the sum of $749, which he then promised to pay, or not, and if there was not whether there was an accounting between them in February, 1914, when it was found that appellee was liable to him in the sum of $1,731, which it then promised to pay, or not, and that the action of the trial court in peremptorily instructing the jury as he did therefore was erroneous, should be sustained. Appellee’s claim that the account between it and appellant was stated in October, 1913, that a balance of $749 was then found to be due it, and that appellant then promised to pay that balance, is disputed in the testimony, as we understand it, of appellant as a witness, and by appellee’s letter of November 6, 1913, to him. If the account between the parties was not then stated and a balance which appellant agreed to pay found to be due to appellee, as it claimed was true, whether appellee was entitled to recover of appellant as determined by the court below, or not, depended upon whether there was an accounting between them in February, 1914, in which it was ascertained that there was a sum due appellant by appellee which it promised to pay, or not. From testimony given on behalf of appellant, which will not be discussed, we think the jury might have found there was such an accounting and promise on the part of appellee. The judgment will be reversed and the cause remanded for a new trial, so that, if the testimony is the same, the issues referred to may be determined by a jury.

Assignments in appellant’s brief presenting other questions for review are overruled.

The judgment is reversed and the cause remanded for a new trial.
      —.For Other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: LEVY, J.

text:
    BAKER v. GRIFFIN.
    (No. 1552.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 25, 1915.)
    Appeal and Error <&wkey;373 — Bonds—Necessity.
    Under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 2113, declaring that the transcript shall contain a copy of the final judgment and notice of appeal bond, an appeal from an order denying a temporary injunction must be dismissed, where the transcript does not show or contain the appeal bond and none was filed within 15 days from the order of refusal.
    [Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 2001-2004; Dec. Dig. <&wkey; 373.]
    Appeal from District Court, Cass County; H. F. O’Neal, Judge.
    Action between A. T. Baker and W. H. Griffin. From an order refusing a temporary injunction, the former appeals.
    Appeal dismissed.
    A. T. Baker, of Linden, for appellant. Elmer ,L. Lincoln, of Linden, and Hugh Carney, of Atlanta, for appellee.
   LEVY, J.

The appeal is from an order of the district judge, made October 5, 1915, refusing to grant a temporary injunction. The transcript was filed in this court on October 16, 1915, and an appeal bond was separately and later filed in the office of the district clerk October 27, 1915, and in this court October 28, 1915. Appellee makes a motion to dismiss the appeal because the transcript does not show and contain an appeal bond (article 2113, Vernon’s Sayles’ Stat), and because no appeal bond has been filed within 15 days from the order of the district judge refusing the injunction. Cited: Hicks v. Murphy, 150 S. W. 955; Electric Co. v. Park, 155 S. W. 965.

It is believed the matter is jurisdictional, and the motion must be sustained, and the appeal dismissed.


author: WILLSON, C. J.

text:
    PALMER et al. v. JAGGAERS et ux.
    (No. 1520.)
    (Court of Civil Appeals of Texas. Texarkana.
    Dec. 10, 1915.
    Rehearing Denied Dec. 16, 1915.)
    1. Venue <&wkey;5 — Tbust Deed — Suit to Avoid —Injunction.
    Where plaintiff sought to have a trust deed declared void as an attempt to create a lien on his homestead and prayed an injunction against the trustee to prevent a sale of the land to satisfy the debt secured, the action was properly brought in the county where the land lay under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 1830, subd. 14, laying the venue of suits involving title to lands in the county where the land lies, instead of being brought in the county of the residence of the trustee, or that of the beneficiary, under the requirement of Vernon’s Sayles’ Ann. Civ. St. 1914, art. 4653, that certain writs of injunction be brought in the county of defendant’s domicile, since the injunctive relief sought was merely ancillary to the main purpose of avoiding the deed.
    [Ed. Note. — For other cases, see Venue, Cent. Dig. §§ 4-11; Dec. Dig. <&wkey;>5.]
    2. Homestead <&wkey;216 — Trust Deed — Ques- ■ tion eor Jury.
    In an action to set aside a trust deed securing a debt, evidence held to require submission to the jury of the issue as to whether land was a homestead.
    [Ed. Note. — For other cases, see Homestead, Cent. Dig. §| 400-403; Dec. Dig. &wkey;216.]
    Appeal from District Court, Franklin County; J. A. Ward, Judge.
    Suit by J. M. Jaggaers and wife to restrain the sale of real estate by Ed I. Palmer as trustee under a trust deed to secure a debt owing to the North Texas Dry Goods Company, and to have the deed declared void. Cross-action by the Dry Goods Company for foreclosure of the trust deed. From judgment of foreclosure as to part of the land only, but granting plaintiffs the relief sought as to the remainder, defendants appeal.
    Reversed.
    By a deed dated November 20, 1911, ap-pellee J. M. Jaggaers conveyed 50 by 120 feet of land in the town of Winfield, Titus county, and 55 acres in Franklin county, to appellant Palmer, in trust to secure the payment of his (Jaggaers’) promissory note for $2,458.39, dated said November 20, .1911, and payable January 1, 1912, to the order of appellant North Texas Dry Goods Company. This suit, commenced by Jaggaers, and prosecuted by him and his wife, who intervened and made herself a' party plaintiff, was to enjoin a sale of the 55 acres, which Palmer as trustee was proceeding to mate by virtue of the trust deed, and to have said trust deed declared to be “void and of no effect,” on the ground that the land at the time the deed was made was a part of their homestead. By a plea filed in due order appellants alleged that a temporary writ of injunction, which, it seems, the court granted, “does not,” quoting, “pertain to a suit in this court, but is a separate and independent action, and said writ has been improperly returned to this court, but should have been re^ turned to either the district court of Lamar county, Tex., or the district court of Hopkins county, Tex., under the provisions of article 4653 of the Revised Civil Statutes of Texas of 1911”; further alleged the residence of Palmer to be in said Hopkins county, and that of the dry goods company in Lamar c'ounty, and, negativing the existence of facts which might entitle appellees to sue them in Franklin county, asserted a privilege they claimed to be sued in either Hopkins or Lamar county, and asked that the cause be transferred as provided by the statute to one or the other of those two counties. This plea was overruled, and the action of the cburt in overruling it is assigned as error. By a cross-action the dry goods company sought judgment against Jag-gaers for the amount of the note and a foreclosure of the lien of the trust deed on the 55 acres of land and also on the lot in Win-field. The appeal is from a judgment (based on a verdict returned by the jury as directed by the court) granting appellees the relief they sought, and awarding the dry goods company a recovery against appellee J. M. Jaggaers for the amount of the note, and foreclosing the lien of the trust deed made to secure it so far as it was on the lot in Winfield.
    A. P. Park, of Paris, R. B. Keasler, of Sulphur Springs, and H. L. Wilkinson and R. T. Wilkinson, both of Mt. Vernon, for appellants. T. C. Hutchings, of Mt. Pleasant, for appellees.
   WILLSON, C. J.

(after stating the facts as above).

The trial court did not err when he overruled appellants’ plea claiming a privilege to be sued in either Hopkins county, where Palmer resided, or in Lamar county, where the dry goods company resided. The main purpose of the suit was to obtain a decree declaring the trust deed of no effect because void as an attempt to create a lien on appellees’ homestead. The relief sought in the prayer for the writ of injunction was ancillary merely to that purpose, and therefore the statute invoked (article 4653, Vernon’s Statutes) did not apply to the suit. Royal Amusement Co. v. Columbia Piano Co., 170 S. W. 278; Parsons v. McKinney, 133 S. W. 1085. Its venue was, we think, controlled by the fourteenth subdivision of article 1830, Vernon’s Statutes, as follows:

“Suits for the recovery of lands or damages thereto, suits to remove incumbrances upon the title to land, suits to quiet the title to land, and suits to * * * stay waste on lands, must be brought in the county in which the land, or a part thereof, may lie.”

But we are of opinion it did not appear from the testimony as a matter of law that the 55 acres were a part of appellees’ homestead at the time same were conveyed to Palmer, and therefore that the court erred when he peremptorily instructed the jury to find that the land was then homestead. Whether it was or not should have been submitted to them for determination.

At the time the trust deed to Palmer was made appellee J. M. Jaggaers was in the mercantile business in Winfield. He was then, and during the 18 years immediately preceding that time had been, living with his family on 128 acres he owned, situated in the country, about 1% miles from Winfield. Before engaging in the mercantile business he had operated a meat market in Winfield, and had rented the 55 acres in controversy and used same as a pasture for cattle owned by him in connection with his meat market He purchased the 55 acres about three years before he conveyed same to Palmer, and about the time he purchased same ceased to operate the meat market. The 55 acres were distant, “straight through” and over lands he did not own, about % of a mile, and by the traveled road about 2% miles, from the 128 acres. He testified, and so did his wife, that he bought the 55 acres for a homestead, intending as soon as he “got a chance” to build a dwelling house on it and then move to and live on it; that when he bought same he “went to. putting stock on there and hogs on there,” and had his 18-year old boy to grow a crop of cotton on it; that one of his married sons lived on the land; that his said married son was sickly, and he “got him to live there and gave him a living out of it”; that the land was not fenced when he bought it, and he “had it all fenced and fixed up.” He further testified that within a month or two after he made the trust deed he and his family m'oved to a house which was on the land at the time he bought it, and there-afterwards to the date of the trial (about three years) lived on and used it as their home. The testimony recited would, we think, have supported a finding by the jury that the land was homestead at the time the trust deed was made, had a question as to whether it was or not been submitted to them. But there was other testimony which, it seems to us, would have supported a contrary finding. The witness Palmer testified:

“I was sent to Winfield about the 18th or 19th of November, 1911, with the understanding to make some kind of settlement with Mr. Jag-gaers, and he suggested that he had a piece of land. Mr. Jaggaers told me he had a piece of land that he would give us a deed of trust to. He said it would be impossible to pay the bill, and if we would extend just a little time lie would gladly give us this deed of trust for this tract of land, and I asked him if it was part of his homestead. He said it was not. He said, ‘I bought it for one reason, for an investment; it was cheap and I use it in connection with my meat market. It is close to Winfield and I have to have a place to put my beef cattle;’ and with that understanding he gave me the deed of trust. He told me his homestead was something like three or four miles from Winfield, and he told me there was something like 128 acres in it, and that they had been living on it for a number of years. He told me the 128 acres was about 2% miles from this land. I had two conversations with him with reference to whether or not this was his homestead; the one I have just related was the first one, and it occurred at Winfield. That is the one in which he proposed to give me the deed of trust. The next conversation I had with him on the subject was at Sulphur Springs, Hopkins county. In that conversation 1 asked him again was it his homestead, and he said, no, it was not a part of his homestead. He told me again that his homestead was 2% miles from this land involved. He said he did not use it in connection with his homestead or claim it as a part of his homestead. He said that he used it for grazing purposes for his beef cattle and also rented it out to individuals at Winfield for cattle at 50 cents a month. He said that this was largely grass land, that it was mostly bermuda, and was used for a pasture. In that connection he stated for what purposes he used it. He said he had had that land about three or four years. I did not know anything about the facts in reference to his land and his property. I did not know exactly where the 128 acres was; I knew somewhere in the neighborhood of where it was located. I knew personally the facts with reference to the location of the 55 acres. I knew that what he said about his home and where he lived ■ was true. I believed his statements with reference to where his homestead was and with reference to his not claiming this 55 acres as any part of his homestead. I acted upon his statements in agreeing to take the deed of trust and extending the time of payment of his indebtedness to the North Texas Dry Goods Company. It was on the strength of his statement that I made this settlement with him.”

The witness Keasler testified:

“I had occasion to write a deed of trust for Mr. Palmer signed by Mr. Jaggaers about November 20, 1911. I was at my office in Sulphur Springs. Those parties came up to my office. My recollection is that Mr. Palmer brought Mr. Jaggaers up into my office. It was the first time I had ever seen Mr. Jaggaers, and Mr. Palmer asked me to write a deed of trust for him. I prepared to do it, and the thought came into my. mind that I ought to find out whether or not it was his homestead, and I asked him if it was his homestead. When I got ready to prepare and write the instrument I asked him if it was any part of his homestead, and he said, no, that he did not claim it as any part of his homestead at all, that his homestead was on another tract he had about 2% miles distant from there. And during the course of the conversation he stated that he had lived on this other piece as his homestead for a number of years, and that he had not had this last tract a great while. The last tract, he stated, the tract of 55 acres, he had not had many years. He said he had bought it for use principally in his meat market business. He stated that he was in the mercantile business at Winfield and was running a meat market in connection with it, as I recollect now, and that he needed some land on which to put his stock. It was largely bermuda, he said, and good pasture. He said he had lived on the 128-acre tract a number of years as his homestead, and at- that time was claiming that as his homestead, and that this 55 acres formed no part of his homestead. He also stated that it was some 2% miles from his home tract. I will not be positive as to whether or not Mr. Jaggaers at that time offered to make a deed to the land; I do not recall that positively.”

It seems to us the use made by appellees of the land after they purchased it, and before it was conveyed to Palmer, as stated, was as consistent with the purpose for which the witnesses quoted testified J. M. Jag-gaers told them he purchased it, as it was with the purpose for which appellees testified it was purchased, and that a finding that the land was or was not homestead would not have been without the support of testimony. Therefore it was, we think, error not to submit to the jury a question as to whether it was homestead or not.

The judgment will be reversed and the cause will be remanded to the court below for a new trial.
      <©=5>For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


text:
    MINOR v. BISHOP.
    (No. 1530.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 18, 1915.)
    1. Witnesses ^3208— ‘Privileged Communications” — ATTORNEY AND CLIENT.
    A communication to an attorney was not a privileged one, where the parties had the same attorney and made communications in the presence and hearing of all for the information of all.
    TEd. Note. — For other cases, see Witnesses, Cent. Dig. §§ 761, 764, 765; Dec. Dig. <&wkey;>206.
    For other definitions, see Words and Phrases, First and Second Series, Privileged Communication.]
    2. Trial <&wkey;25 — Right to Open and Close.
    It is the province of the court alone to determine the right to open and conclude the argument.
    [Ed. Note. — For other cases, see Trial, C&nt. Dig. §§ 44-75; Dec. Dig. &wkey;>25.]
    Appeal from Hopkins County Court; Dan R. Junell, Judge.
    Action by G. W. Bishop against J. K. Minor and others. From the judgment for plaintiff, defendant J. K. Minor, appeals.
    Judgment as to appellant reversed and remanded, and judgment otherwise undisturbed.
    J. A. Dial and A. W. King, both of Sulphur-Springs, for appellant. D. Thornton and E. Thornton, both of Sulphur Springs, for appellee.
   LEVY, J.

On October 15,1913, T. W. Melton, J. K. Minor, O. D. Cawthron, and seven others executed and delivered to G. W. Bishop á promissory note for $275, due October 15, 1914. After the maturity of the note G. W. Bishop, as owner, brought suit on the note. Judgment by default was taken against all the signers of the note except C. D. Cawthron and J. K. Minor. J. K. Minor, who alone appeals, pleaded in confession and avoidance, that lie liad been released by ap-pellee as a joint obligor and maker of the note under and in virtue of an agreement made upon a valuable consideration in August, 1914. There was a trial before a jury, and verdict in favor of appellee.

Upon the trial of the case the appellant testified that he and appellee made an agreement of release, as pleaded by him, and that it was done in the office and in the presence of Mr. O. E. Sheppard, an attorney. The evidence of appellee Bishop was in denial of any agreement of release. Appellant called as a witness Mr. Sheppard—

“for the purpose,” as the bill of exception reads, “of proving a conversation that took place in the said Sheppard’s office by and between the said Sheppard, plaintiff, and J. K. Minor, wherein it was contended by said Minor that the said Sheppard would testify that plaintiff had agreed to release the said Minor if the said Minor would make bail bonds to release plaintiff’s two sons, who were charged with crime.”

The appellee interposed objection to Mr. Sheppard testifying upon the ground that the conversation was privileged communication between attorney and client. The court sustained the objection of appellee, and that ruling of the court is assigned as error. It is concluded that the offered evidence cannot be pronounced incompetent on the ground that the communication to the attorney was a privileged one, for there can be no privilege, among themselves, where both parties having the same attorney make communications in the presence and hearing of all, intended for the information of all. Henderson v. Terry, 62 Tex. 281; Cady v. Walker, 62 Mich. 157, 28 N. W. 805, 4 Am. St. Rep. 834; Hanlon v. Doherty, 109 Ind. 37, 9 N. E. 782 ; 40 Cyc. p. 2368; 1 Greenleaf, Ev. (Ed. 1899), § 245. The error is sufficient in the record to cause reversal.

The third assignment of error is overruled, as it was not error to refuse to so instruct the jury. It is the province of the court alone to determine the right to open and conclude the argument. Therefore the question made by appellant in his propositions cannot be considered and must be left open, in view of the form of the assignment and exception presented.

The judgment is reversed and the cause remanded for a new trial as to appellant. The judgment as to the other defendants, not being appealed from, will remain undisturbed.

        ®s>For other cases see same topic and KEY-NUMBER, in all Key-Numbered Digests and Indexes


text:
    SPAULDING MFG. CO. v. TRAMMEL et al.
    (No. 1529.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 18, 1915.)
    COURTS <&wkey;247 — JURISDICTION— COTJBT 03? CIVIL Appeals — Amount Involved.
    Under Vernon's Sayles’ Ann. Civ. St. 1914, art. 1589, authorizing an appeal from the county court to the Court of Civil Appeals only where the amount exceeds $100 exclusive of interest and costs, an appeal by plaintiff from a judgment in the county court for a party claiming a bale of cotton levied on under attachment, and worth $48, was unauthorized, though the action, which was brought against claimant’s husband, was to recover $124 on a note.
    [Ed.’Note. — Eor other cases, see Courts, Cent. Dig. §§ 487, 757; Dec. Dig. &wkey;247.]
    Appeal from Shelby County Court; Hoya B. Short, Judge.
    Action by the Spaulding Manufacturing Company against G. I. Trammel, in which Mrs. G. I. Trammel intervened as a claimant of property attached. From judgment for claimant in the county court on appeal from justice court, plaintiff appeals.
    Appeal dismissed.
    K. W, Stephenson, of Center, for appellant. S. H. Sanders, of Center, for appellee.
   WILLSON, C. J.

Appellant sued appellee G. I. Trammel, seeking a recovery against him of $124, alleged to be due it on a promissory note made by him, and, having procured the issuance of a writ of attachment out of a justice court, caused it to be levied on a bale of lint cotton of the value of $48. Ap-pellee Mrs. G. I. Trammel, wife of said G. I. Trammel, claimed that the bale of cotton belonged to her as a part of her separate estate, and presented to the officer who levied the writ on it an affidavit and claim bond, entitling her to a trial of the right of property in the cotton as between her and appellant. In the justice court, and also in the county court, on an appeal thereto prosecuted by appellant, judgment was rendered in her favor for the cotton. This appeal is from the judgment rendered by the last court mentioned.

We are of opinion appellee’s motion to dismiss the appeal, on the ground that this court has not power to hear and determine it, should be sustained. The jurisdiction of this court does not extend to cases “of which the county court has appellate jurisdiction, when the judgment, or amount in controversy, or the judgment rendered,” does not exceed $100, exclusive of interest and costs. Article 1589, Vernon’s Statutes. The “amount in controversy” in the trial of the right of property suit was the value of the bale of cotton, to wit, $48. Erwin v. Blanks, 60 Tex. 583; Harris v. Hood, 1 White & W. Civ. Cas. Ct. App. § 573. The judgment appealed from was for that bale of cotton.

The motion will be granted, and the appeal dismissed.
      cgrsjFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


author: HODGES, J.

text:
    DUKE et ux. v. TRABUE.
    (No. 1515.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 25, 1915.)
    1. Lis Pendens <&wkey;26 — Parties <&wkey;40 — P urchasebs — Intervention.
    The purchase of a cause of action during the pendency of a suit does not vest the purchaser with the right to intervene, though he has the right to have the cause proceed in the name of his assignor; the judgment rendered inuring to the benefit of the purchaser.
    [Ed. Note. — Eor other cases, see Lis Pendens! Cent. Dig. §§ 58-62; Dec. Dig. <©=>26; Parties, Cent. Dig. §§ 60-63, 65-67; Dec. Dig. @=>40.]
    2. Appeal and Error @=>79 — Review—“Final Judgment.”
    Action was originally brought in justice court, and appealed by defendants to the county court, where a different plaintiff appeared, and judgment was rendered in his favor without disposing of the original plaintiff. Held that, though the second plaintiff was an assignee of the cause of action, yet the judgment, not having disposed of the original plaintiff, was not final, and so an appeal therefrom will be dismissed.
    [Ed. Note. — Eor other cases, see Appeal and Error, Cent. Dig. §§ 484-493; Dec. Dig. @=>79.
    For other definitions, see Words and Phrases, Eirst and Second Series, Final Judgment.]
    Appeal from Panola County Court; Geo. Harkrider, Judge.
    Action by R. E. Trabue against C. B. Duke and wife; begun in justice court, and appealed by defendants to the county court. There R. C. Trabue appeared as plaintiff. Prom a judgment in his favor, defendants again appeal.
    Appeal dismissed.
    Prank Lawson and H. N. Nelson, both of Carthage, for appellants. P. P. Long, of Carthage, for appellee.
   HODGES, J.

This appeal is from a judgment rendered in the county court of Panola county in favor of R. O. Trabue against Mrs. O. B. Duke. The record shows that the suit was originally instituted in the justice court by R. E. Trabue, as plaintiff, against C. B. Duke and his wifé on a promissory note executed by Mrs. Duke alone, payable to the Guaranty State Bank of Carthage, Tex. In that court the plaintiff, R. E. Tra-bue, recovered a judgment against “the defendant” (singular) for the amount of the note, interest, and the attorney’s fee. That judgment was rendered on January 31, lul3. On the 3d day of February following Duke and wife filed an appeal bond payable to R. E. Trabue. In the county court R. C. Trabue, admittedly a different party, appears as the plaintiff. The recital of the pleadings in the county court shows that R. C. Trabue, as the plaintiff, pleaded an ordinary promissory note for $162.52, with interest and attorney’s fees, signed by Mrs. Duke, dated June 29, 1912, due on the 1st day of the following October, and payable to the Guaranty State Bank of Carthage, Tex., or order; that the note bore the following indorsement: “Pay to R. E. Trabue. [Signed] Guaranty State Bank.” C. B. Duke pleaded that he never executed the note and was in no way liable for its payment. Mrs. C. B. Duke pleaded that she was a married woman living with her husband at the time she executed the note, and for that reason it was void as against her. By way of reply to this plea of coverture the then plaintiff, R. C. Trabue, alleged that the note was executed by Mrs. C. B. Duke for and in payment of an account for $162.52 due to R. E. Trabue from Mrs. C. B. Duke for lumber and other merchandise furnished her before her marriage with her present husband. It was further alleged that R. E. Trabue was declared a bankrupt, and that he (the plaintiff R. C. Trabue) bought the note from the trustee in bankruptcy, and, as the note had been accepted by R. E. Trabue in payment of the account, he (the plaintiff) sued for the amount of the account, which was $162.52. To this plea exceptions were filed by Mrs. C. B. Duke, which were overruled by the court. The ease was submitted on special issues, and upon the findings of the jury a judgment was rendered in the county court in favor of R. C. Trabue for the amount of the original debt. No mention of R. E. Tra-bue, the original plaintiff, was made in the judgment;

It is suggested in the briefs of counsel for the appellant that after the appeal to the county court R. C. Trabue intervened and prosecuted the suit in his own name. Conceding that to be true, we are of the opinion that all of the parties before the court were not disposed of, and that no final judgment has been entered in the case from which an appeal will lie to this court. R. E. Trabue was the sole original plaintiff, and had recovered a judgment in the justice court. If during the pendency of the suit his interest was assigned to R. O. Trabue, the latter had the right to have the cause proceed in the name of R. E. Trabue, and the judgment rendered would inure to his benefit as the assignee. Smith v. Olsen, 92 Tex. 181, 46 S. W. 631. The purchase of a cause of action during the pendency of a suit thereon does not vest the purchaser with a right to intervene. Sherrod v. Terrell, 97 Tex. 97, 76 S. W. 442; Hearne v. Erhard, 33 Tex. 61. But, assuming that he does, that proceeding alone does not ipso facto displace the original plaintiff. The latter may deny the truth of what the intervener alleges. But, whether he admits or denies those facts, there is a new issue presented for the court to determine. The judgment is not final till the original plaintiff’s claim is disposed of. Jackson v. Coombs, 65 S. W. 385; Mignon v. Brinson, 74 Tex. 18, 11 S. W. 903; Patton v. Bender, 103 S. W. 690.

The appeal will be dismissed.
      ©cxoFor other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


text:
    MORGAN v. WASHBURN LUMBER CO. et al.
    (No. 1440.)

    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 26, 1915.
    Rehearing Denied Dec. 9, 1915.)
    1. CORPORATIONS <©=>404 — AUTHORITY OB Peesident — Contract to Sell Lands.
    Under the law of Louisiana as well as this state, the president of a corporation has no authority to contract for the sale of corporation lands, in the absence of authority conferred on him by the directors.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1626-1628, 1633-1639; Dec. Dig. i&wkey;>404.]
    2. CORPORATIONS <&wkey;432 — Authority ox President — Evidence.
    Evidence held insufficient to show that defendant corporation held out its president as its agent having authority to contract for the sale of its lands.
    [Ed. Note. — For other cases, see Corporations, Cent. Dig. §§ 1717, 1718, 1726-1735, 1737,1743, 1762; Dec. Dig. <®==v432.]
    3. Corporations <&wkey;432 — Contract by President — Ratification—Knowledge.
    The evidence did not show ratification by a corporation of a contract by its president to sell its lands, where it did not show knowledge of the corporation, through some other officer or agent beside the president, of the facts relating to the transaction.
    [Ed. Note. — For other cases, see Corporations* Cent.'Dig. §§ 1717, 1718, 1724, 1726-1735, 1737, 1743, 1762; Dec. Dig. &wkey;432.]
    Appeal from District Court, Panola County; W. C. Buford, Judge.
    Action by W. Hi Morgan against the Washburn Lumber Company and others. From a judgment for defendants, plaintiff appeals.
    Affirmed.
    This was a suit for the specific performance of a contract, made in the state of Louisiana, to convey land in this state, or, in the alternative, for damages for a breach of the contract. It was by appellant as plaintiff against appellees, the Washburn Lumber Company, a corporation under the laws of Louisiana, T. E. Stephenson, and Paul J. Leidigh. The contract, dated September 8, 1913, was as follows:
    “We have this day agreed to sell to W. H. Morgan the Francis Jordan and P. R. Wilson survey in Texas (640 acres, more or less), now owned by us, for the sum of $2,040.00, to be paid as follows: $1,040 cash, balance of $1,000 in one note, due two years from date, with 8 per cent, interest. $5.00 paid on the above which is hereby acknowledged.
    “Washburn Lbr. Co.
    “T. E. Stephenson.
    “W. H. Morgan.”
    The contract was executed on behalf of the. lumber company by Stephenson, the president thereof. As we understand it, appellant is not in the attitude of contending on this appeal that Stephenson personally was liable on the contract. Leidigh, it seems, was made a party defendant because the lumber company, subsequently to the date of the instrument set out above, conveyed the land in question to him.
    The trial was to the court without a jury. The appeal is from a judgment determining that appellant was not entitled to judgment decreeing a specific performance of the contract, nor to a recovery of damages for its breach, because it appeared that Stephenson was without authority to make it on behalf of the lumber company, but further determining that the lumber company was indebted to appellant in the sum of $782 “for timber and $5 advanced on the contract for amounts before and since the making of said contract by Stephenson,” and awarding a recovery in appellant’s favor against the lumber company for said sum of $782.
    Brooke & Woolworth, of Carthage, for appellant. H. N. Nelson, of Cartilage, and J. C. Pugh, of Shreveport, La., for appellees.

      Writ ot error pending in Supreme Court.

   WILLSON, C. J.

(after stating the facts as above). In support of his first assignment, that the judgment is erroneous in so far as it denied him relief by specific performance, or, in the alternative, by damages, appellant insists:

1. That the undisputed evidence showed that Stephenson was the president of the lumber company — ■

“and had full power and authority to sell lands and make contracts with reference to lands belonging to said company at the time the written contract was entered into.”

The contention is supported by the record to this extent only: That it was shown that Stephenson was the lumber company’s president, and as such acted for it in making the contract. It was not shown that as such president he was authorized to bind the company by a contract to sell its lands. On the contrary, it was shown that under the laws of Louisiana, in the absence, as was the case, of authority conferred_ upon him by the company’s board of directors, he was without power, merely because he was the president of the company, to bind it by such a contract. And such is the rule in this state. Fitzhugh v. Franco-Texas Land Co., 81 Tex. 311, 16 S. W. 1078; Hurlbut v. Gainor, 45 Tex. Civ. App. 591, 103 S. W. 409; Aransas Pass Harbor Co. v. Bank, 28 Tex. Civ. App. 372, 67 S. W. 906. It was not pretended that he was the agent of the company in any other way than as its president and general manager of its sawmill business.

2. That the undisputed evidence showed that the lumber company held Stephenson out as its agent with power and authority to sell its lands and to make contracts binding it to sell same. This contention is based on testimony showing that Stephenson was the president and general manager of the lumber company’s business, which was the operation of a sawmill, and as such, a witness testified, “looked after the whole business around there.” It was not shown, however, that Stephenson ever, either before or after he entered into the contract with appellant, undertook to bind the company by a contract to convey its lands, or that the company ever did or said anything which justified appellant in believing it was in the attitude of holding Stephenson out as possessing such authority, unless it was the transaction with one Luttrell. With reference to that transaction Luttrell testified:

“I have had dealing with Mr. Stephenson in the buying of land from him and contracting with him to buy land from the Washburn Lumber Company. These contracts were afterwards performed. First we had an understanding in regard to a piece of timber — the land with the timber — I was to pay him a certain price for it; and after we cut the timber, some time, possibly a year, Mr. Stephenson and Mr. Leidigh and myself were riding around over the woods one day, and we got back on this piece of land; and I called their attention to it and told them that I would like to buy this land; that I would like "to have a deed to it., Of course, there were several remarks made about it. They questioned me as to what I wanted to do with it — I had theretofore entered into a verbal contract with them. So, after going over the thing at some length, Mr. Leidigh remarked to Mr. Stephenson that he guessed ‘we had better sell it to him,’ or words to that effect; that is, he gave his consent, you know, and showed to Mr. Stephenson that he was willing to make this transfer. That was before making the deed. The deed was not made on the same terms as the original agreement. The first agreement was $2.50 an acre, and the next one was $4.50. They refused to carry out the agreement so far as the $2.50 was concerned, but agreed to sell it for $4.50. The Washburn Lumber Company made me a deed, and so the transaction was completed.”

On Ms cross-examination Luttrell further testified:

“I did not get my deed then. It was through the unanimous vote of the board of directors that I got the deed.”

It is obvious, we tMnk, that the testimony referred to — and there was none other of greater probative force — did not raise an issue as to whether the lumber company was in the attitude of being estopped -from denying that Stephenson, as its agent, was authorized to bind it by a contract to sell its lands or not. The trial court should, as he did, have determined as a matter of law that the lumber company was not in that attitude.

3. That the undisputed evidence showed that at the time the contract was entered into the lumber company owed appellant $787, which it then agreed to apply as a cash payment on the land, and which it refused thereafterwards to pay to appellant. It is argued from this alleged state of the evidence that it appeared that the lumber company had ratified and made its own the act of Stephenson on its behalf when he executed the contract. While it, perhaps, is of no importance in determining the question made, it may be said, in passing, that the evidence was not undisputed that the lumber company owed appellant $787 at the time stated. The testimony was, by Stephenson, that the company then owed appellant $446, and by appellant that it owed him “some $400 or $500.” Nor was it undisputed that it was then agreed that the sum due appellant by the company should be applied as a cash payment on the land. While appellant testified it was so agreed, Stephenson testified that:

“There was nothing said about applying the money we owed him [appellant] as a cash payment. The paper shows it to be a cash transaction.”

There was no evidence that any other officer or agent of the lumber company than Stephenson ever knew, until appellant’s suit was commenced, that Stephenson had entered into the contract in question with appellant, or had received for it from appellant anything as a payment on the land. In the absence of evidence of knowledge on its part, through some other of its officers or agents than Stephenson, of the facts in regard to the transaction, an issue as to its ratification of the contract did not arise. Cowan v. Sargent Mfg. Co., 141 Mich. 87, 104 N. W. 377; 1 Corpus Juris, 476.

The other assignments in the brief have been, in effect, disposed of by the rulings made.

There is no error in the judgment, and it is affirmed.
      &wkey;jRor other oases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes


text:
    W. K. HENDERSON IRON WORKS & SUPPLY CO. v. WILKINS.
    (No. 1519.)
    (Court of Civil Appeals of Texas. Texarkana.
    Nov. 11, 1915.)
    1. Principal and Agent <&wkey;23 — Pact or Agency.
    Testimony that some one who answered-defendant’s telephone call for plaintiff company stated he was a manager, and that repairs would be made at the same prices the factory, at which the machinery was bought, would charge is insufficient to show that plaintiff contracted to make the repairs at factory price.
    [Ed. Note. — Por other cases, see Principal and Agent, Cent. Dig. § 41; Dec. Dig. <&wkey;>23.]
    2. Judgment &wkey;>255 — Coneoemity to Evidence.
    Where there was no evidence as to the reasonableness of a charge for repairs other than plaintiff’s testimony that the charge was reasonable, the court cannot find a smaller sum to be a reasonable charge.
    [Ed. Note. — Por other cases, see Judgment, Cent. Dig. § 445; Dec. Dig. &wkey;>255.]
    Appeal from Franklin County Court; O. L. Reaves, Judge.
    Action by the W. K. Henderson Iron Works & Supply Company against J. M. Wilkins. There was a judgment for plaintiff for part of its claim, and it appeals.
    Reversed and. remanded.
    H. L. Wilkinson, of Mt. Vernon, for appellant. R. T. Wilkinson, of Mt. Vernon, for appellee.
   HODGES, J.

The appellant, a private-corporation domiciled at Shreveport, La., sued the appellee to recover the sum of $225.-15 on account for repairing some machinery.. The appellee admitted that the appellant had performed the services, but claimed that according to a contract previously made he only owed the sum of $150. In a trial before the court without a jury a judgment for the latter sum was rendered in favor of the appellant. Prom that judgment the appellant has appealed, claiming that it should have recovered the full amount sued for.

The evidence shows that the appellee was operating an ice and light plant at Carthage, Tex., and, desiring to have his machinery repaired, called for the W. K. Henderson Iron Works & Supply Company over the long distance telephone. In a conversation with some one who answered and represented himself to be the manager of that company appellee stated the extent of the repairs he wished made, and had an agreement with that party that the charges would be the same as the factory prices for the same work.

The court found that there was a contract on the part of the appellant by which it was to charge the factory price for the work, and he further found that $150 was a reasonable price for the services performed. The appellant contends that both conclusions are unsupported by the evidence.

The only testimony as to the contract regarding the price was that of the appellee. I-Ie stated, in substance, that after his machinery was broken he went to the long distance telephone ■ and called for the W. K. Henderson Iron Works & Supply Company, and, after explaining what was wanted, asked if it would repair the shaft for the same price that would be charged by the factory at Canton, Ohio; and that he was informed that the charges would be the same. He admits that he did not know the party with whom he talked, or whether that party had any connection with the appellant. He supposed the party was the manager because he said he was. This evidence is too unsatisfactory to support the conclusion that the appellant had contracted to repair for the factory price.

The only testimony regarding the reasonableness of the claim was that of the appellant’s witness W. S. Dunklin, who was the secretary of the company. He testified that the services rendered were reasonably worth the sum charged, $225.15. Under this evidence the court had no right to find that a smaller sum was a reasonable charge.

The judgment is therefore reversed and the cause remanded.
      &wkey;>For other eases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes