Case Name: SANGER v. FIRST NAT. BANK OF AMARILLO et al.
Court: Texas Courts of Civil Appeals
Jurisdiction: Texas
Decision Date: 1914-10-24
Citations: 170 S.W. 1087
Docket Number: No. 648
Parties: SANGER v. FIRST NAT. BANK OF AMARILLO et al.
Judges: HENDRICKS, J., not sitting.
Reporter: South Western Reporter
Volume: 170
Pages: 1087–1096

Head Matter:
SANGER v. FIRST NAT. BANK OF AMARILLO et al.
(No. 648.)
(Court of Civil Appeals of Texas. Amarillo.
Oct. 24, 1914.
On Motion for Rehearing, Nov. 14, 1914.
On Second Motion for Rehearing, Nov. 28, 1914.)
1. Appeal and Error (§ 928 ) — Review—Presumptions — INSTRUOTIO NS.
Under Rev. St. 1911, art. 1973, as amended by Acts 33d Leg. c. 59 (Vernon’s Sayles’ Ann. Civ. St. 1914, art. 1973), which requires requested instructions to be presented to the court and submitted to the opposing counsel, it is the duty of the court, and not of the party making the request, to submit them to the op1 posing counsel, and it will be presumed that the court performed its duty.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3749-3754; Dee. Dig. § 928. ]
2. Bills and Notes (§ 132 ) — Operation-Collateral Agreement — Liability op Maker — “Placed.”
Defendant gave a note to B. in payment for 100 shares of the stock of a corporation; the certificate being issued to defendant. An agreement was made at that time by which the note should not be binding until the rest of the 250 shares subscribed for by B. was “placed” for the purpose of completing the plant. After the issuance of the stock plaintiff bank, with knowledge of the collateral agreement, advanced $4,500 to the corporation on the note. Part of the balance of the stock subscribed by B. was paid for in cash by different parties and issued to them, but a certificate for 20 shares of it was issued in defendant’s name, to which was attached another note signed by him for $2,000, and also payable to B., which note was delivered by B. to the corporation, and another certificate for five shares of stock was issued in the name of' a subscriber thereto, with draft for the purchase price attached, which draft was never paid. Neither of these certificates was ever delivered. Held, that the certificates, not having been legally issued under Const, art. 12, § 6, forbidding the issuance of corporate stock except for money paid, labor done, or property received, could not be considered as having been “placed” within the meaning of defendant’s agreement, so that his note was not binding as to the plaintiff bank or as to other parties which had knowledge of the collateral agreement.
[Ed. Note. — For other cases, see Bills and Notes, Cent Dig. §§ 316-324; Dee. Dig. § 132. For other definitions, see Words and Phrases, First and Second Series, Place.]
3. Appeal and Error (§ 934 ) — Presumptions — Statutes.
The presumption created by Vernon’s Sayles’ Ann. Civ. St. 1914, art. 1985, that, where special issues are submitted, the failure to submit a particular issue does not require a reversal, but it will be presumed that the court found on such issue the facts necessary to support the judgment, does not apply where the pleadings of the successful party do not contain allegations which are necessary to support the judgment.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3777-3781, 3782; Dec. Dig-. § 934. ]
4. Trial (§ 215 ) — Instructions—Necessity —Submission of Special Issues.
Even where a case is submitted on special issues, the court, if requested, should charge with reference to the rules of law applicable to such issues, including a charge on the burden of proof.
[Ed. Note. — For other cases, see Trial, Cent. Dig. § 481; Dec. Dig. § 215. ]
5. Judgment (§ 243 ) — Parties — Dismissal as to One Party.
Where the original defendant asked to have others made defendants, and all of the parties appeared and answered except one, who was no't a necessary party, and thereafter defendant’s motion to dismiss as to the party not answering was granted, it was error to render judgment for that party.
[Ed. Note. — For other cases, see Judgment, Cent. Dig. § 428; Dee. Dig. § 243. ]
On Motion for Rehearing.
6. Appeal and Error (§ 253 ) — Presenting Questions in Lower Court — Exceptions to Pleadings.
Plaintiff cannot on appeal complain that the answer of defendant did not state the legal effect of the contract relied on, where no special exception was taken to the answer on that account.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 1485, 1488, 1491-1493; Dec. Dig. § 253. ]
7. Pleading (§ 34 ) — Construction—Review —Conclusion.
An allegation of a legal conclusion that the condition upon which defendant’s liability depended had been performed need not be considered on appeal, even though it was alleged to be upon information from the defendant.
[Ed. Note. — For other cases, see Pleading, Cent. Dig. §§ 5y2, 66-74; Dec. Dig. § 34. ]
8. Appeal and Error (§ 1122 ) — Disposition op Cause — EindiNGS—Immaterial Matters —Pleadings.
Where plaintiff’s supplementary petition contained a general demurrer to defendant’s answer, to the overruling of which plaintiff excepted, the opinion of the Court of Civil _ Appeals, on appeal by the defendant from a judgment against him, where no cross-appeal was taken by plaintiff, need not state that the demurrer was filed and overruled.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. § 4420; Dec. Dig. § 1122. ]
9. Appeal and Error (§ 664 ) — Conflict in Record — Recitals.
A recital in a judgment dismissing one who had been made defendant that such defendant had filed no answer is conclusive against the file mark on a paper in the record purporting to be the answer of such defendant.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 2856-2859; Dec. Dig. § 664. ]
10. Exceptions, Bill of (§ 19 ) — Sufficiency — Refusal of Requested Charges.
Under Rev. St. 1911, art. 2059, providing that no particular form is necessary in a bill of exceptions, but the objection shall be stated with so much evidence as may be necessary to explain it, and no more, a bill of exceptions which refers to a charge requested by the defendant by number, which request was marked “Refused” by the trial judge and filed with the clerk, so as to become a part of the record under Vernon’s Sayles’ Ann. Civ. St. 1914, art. 1974, is sufficient, since documents in the record need not be copied in the bill of exceptions provided there is a sufficient reference in the bill to identify them.
[Ed. Note. — For other cases, see Exceptions, Bill of, Cent. Dig. § 20; Dec. Dig. § 19. ]
11. Appeal and Error (§ 839 ) — Disposition oe Case — Conclusions of Law — Rulings on Specific Assignments.
The Court of Civil Appeals is not required to rule specifically on each assignment of error, especially where the appellant makes no request for such rulings.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 2915, 3278, 3279, 3280, 3286-3288, 3290-3293, 3297-3300, 3377; Dee. Dig. § 839. ]
On Second Motion for Rehearing.
12. Appeal and Eriror (§ 833 ) — Rehearing —Irrelevant and Impertinent-Matter.
A motion for rehearing containing irrelevant and impertinent matter may be stricken from the files.
[Ed. Note. — For other cases, see Appeal and Error, Cent. Dig. §§ 3214, 3229-3240, 3244r-3246; Dee. Dig. § 833. ]
Appeal from District Court, Potter County; Jas. N. Browning, Judge.
Action by the First National Bank of Amarillo against Charles W. Sanger, in which the National Bank of Commerce and others were made parties defendant, at the request of the defendant Sanger. Judgment against the defendant Sanger in favor of the plaintiff and the other defendants, and defendant Sanger appeals.
Reversed and remanded, motion for rehearing denied; and second motion for rehearing stricken from the files.
W. Boyce, of Amarillo, for appellant. Madden, Trulove & Kimbrough, Crudgington & Works, and Synnott & Underwood, all of Amarillo, for appellees.
For other eases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep’r Indexes
For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep r Indexes

Opinion:
HALL, J.
The First National Bank of Amarillo brought this suit against Charles W. Sanger, declaring on a note for $10,000, dated January 15, 1910, alleged to have been payable to O. W. Butt, and that its payment was secured by 100 shares of stock in the Panhandle Packing Company, issued to Charles W. Sanger, and attached to said note as collateral. By his answer defendant Sanger made the National Bank of Commerce, H. B. Sanborn, Amarillo Bank & Trust Company, Will A. Miller, Jr., J. W. Crudgington, M. O. Nobles, and the Amarillo Improvement Company parties defendant, and alleged that said $10,000 note was given to O. W. Butt for 100 shares in the Panhandle Packing Company which the said Sanger was purchasing from Butt; that the said Butt had subscribed for $25,000 of stock in said Panhandle Packing Company; and that contemporaneously with the execution of said note another instrument in writing was executed and signed by the said Butt, whereby it was provided that the said $10,000 note should not become binding or effective until the remainder of said $25,000 of stock subscribed for by the said Butt had been "placed for the purpose of completing the plant." 1-Ie further answered that, contemporaneously with the execution of said note, the said defendant Sanger agreed to purchase of the said Butt 100 shares of stock in the Panhandle Packing Company, and was to pay for the same by the execution and delivery of said note; that, as part of the consideration for such sale, the said Butt agreed to guarantee that the said stock should at all times while owned by the said Sanger be worth par, and should produce at all times a profit of not less than 10 per cent., and, when sold, should net the said Sanger $10,000, with interest at the rate of 10 per cent, per annum thereon, from date of said note, and that the s^id Butt would deposit 450 shares of stock owned by him in the Panhandle Packing Company to secure the performance of said agreement; that according to the agreement of the parties the guaranty contract was to be executed in writing contemporaneously with the delivery of said notes; that while the papers were being prepared embodying said agreement in writing, the said Sanger was compelled to leave Amarillo suddenly; that the said note was prepared and signed by the said Sanger and delivered with the express understanding and agreement that the instrument embodying the guaranty contract should be immediately prepared by S. H. Madden, signed by the said Butt, and should form a part of the contract between said parties; that said guaranty contract was prepared by the said Madden, in accord- anee with such agreement, but the said Butt repudiated the same, and refused to sign it, and has wholly repudiated and denied any liability by reason of said agreement; that the said Butt failed to place said 450 shares of stock in escrow, and said stock is of no value, and has never produced any profit or dividend; that the consideration for the execution of said note has wholly failed, and that plaintiff bank took said note with notice of the facts above recited. By its supplemental petition plaintiff denied that the condition named in the memorandum executed by Butt, with reference to placing his $25,000 of stock, had not been performed, and alleged that defendant Sanger and Butt both represented to plaintiff that the said condition had been performed at and before the delivery of said note to plaintiff; that the plaintiff, in consideration thereof, advanced to the said Butt the sum of $4,500, and the National Bank of Commerce advanced the sum of $2,500; that Will A. Miller, Jr., the Amarillo Improvement Company, and H. B. Sanborn each advanced $1,000, all of which advances were made to enable the said Butt to pay out and obtain 100 shares of stock issued to the said Sanger and attached to said note, and that the defendant Sanger, by reason, of such representations, was estopped to deny liability on shid note. Plaintiff denied that it had any notice of the alleged guaranty contract between Butt and Sanger until after the institution of this suit. The defendants National Bank of Commerce, Will A. Miller, Jr., Western Stockyards Company, M. C. Nobles, J. W. Crudgington, and Mrs. Ellen M. San-born (as the community survivor of H. B. Sanborn), who had been made defendants by Charles W. Sanger, by way of cross-action and reconvention against the said Sanger, alleged that each of them, except the National Bank of Commerce, had executed and delivered to O. W. Butt an accommodation note, each for the sum of $1,000, to enable the said Butt, by use of the said Sanger note as collateral security to the notes executed by said parties, to secure money with which to put in operation the packing plant, and that the defendant the National Bank of Commerce, relying upon the - securities aforesaid, advanced to the said Butt $2,500; that the said defendants Miller and Sanborn had subsequently paid the notes of $1,000 each executed by them; that the notes executed by the Western Stockyards Company, M. C. Nobles, and J. W. Crudgington are still held by the plaintiff bank; that said parties, in executing said notes, relied on the security of said $10,000 note executed by Sanger, and had no notice of any agreement or conditions attached to the execution and delivery of said $10,000 note as pleaded by the defendant Sanger. Upon the trial Sanger dismissed as to the defendants interpleaded by him, but the court permitted the defendants National Bank of Commerce, Will A. Miller, Jr., West- j ern Stockyards Company, Ellen M. Sanborn, | J. W. Crudgington, and M. C. Nobles to remain in the case, because each filed an answer; but the defendants Amarillo Improvement Company and Amarillo Bank & Trust Company, having filed no answer, were dismissed. It was shown upon the trial that O. W. Butt had subscribed for $75,000 of the stock of the packing company; that he had paid $50,000 of this amount in machinery and services; and that the remaining $25,000 of his subscription was to be paid in cash. Not having the cash necessary to make this payment, Butt was making an effort to sell this $25,-000 of stock so that it might be issued by the company and the plant completed. Certain citizens of Amarillo, including the appellants codefendants in this case, being interested in seeing the packing plant completed and put in operation, were induced to aid the said Butt in his efforts to dispose of said stock. Defendant Sanger, as has been stated, agreed to take 100 shares of this stock, for which the $10,000 note sued upon was executed. Negotiations between them having reached this stage on January 15th, Sanger received a telegram that his wife was sick in California, and left on the evening train, an effort being made to close the transaction before train time. Late in the afternoon of that day a meeting was had at the First National Bank of Amarillo between O. W. Butt, Charles W. Sanger, and W. H. Fuqua, president of the First National Bank, during which meeting the said note was executed and delivered to Fuqua, and the following agreement was also dictated, and either at that time or subsequently, signed by Butt:
"The First National Bank.
"Amarillo, Texas, Jan. 15, 1910.
"This memorandum is to witness that I have this day received of Charles W. Sanger one note for $10,000, which note is now being held by W. H. Fuqua, pending the issue of '100 shares of stock in the Panhandle Packing Company of Amarillo, Texas, which is to be issued to Mr. Charles W. Sanger, the executor of this note; and when-said stock is issued to him and attached to this note, then it becomes the property of Mr. O. W. Butt, which he desired to use in the way of collateral with his stocks, for the purpose of procuring money from the banks or elsewhere, for the finishing of the packing plant. This obligation is not to become effective or binding until the remainder of my stock is placed for the purpose of completing the plant, aggregating $25,000.
".[Signed] O. W. Butt."
On the same evening Butt and Sanger applied to Attorney S. H. Madden, for the purpose of having the guaranty contract prepared. The purpose of making the accommodation notes for $1,000 each, by defendants Miller and others, was to aid Butt to procure the $10,000 upon the Sanger note from the banks of Amarillo. It further appears that after Sanger left on January 17,1910, a meeting composed of W. H. Fuqua, O. W. Butt, J. W. Crudgington, Will A. Miller, Jr., M. C. Nobles, J. IL. Smith, the president of the National Bank of Commerce, and perhaps others, was had, at which meeting the whole arrangement for'the loan of $10,000 upon the Sanger note and upon the accommodation notes was explained. Fuqua said nothing at this meeting about any collateral guaranty concerning the $10,000 note, and there is no evidence that any of the parties except Fuqua had actual knowledge thereof, but it was agreed at that time that the First National Bank on this security would advance $4,500, and the National Bank of Commerce $2,500. The Amarillo Bank & Trust Company agreed to buy outright three of the accommodation notes, but refused to participate in the collateral agreement. The $25,000 of stock subscribed for by Butt and referred to in the memorandum accompanying the $10,000 note was placed as follows: $500 sold to Mrs. Adair, for cash, stock being issued December 3, 1909; $1,000 sold to Mr. Bugbee for cash, time of its issuance not appearing from the record; the balance of $25,000 of stock was made out in certificates on January 17, 1910, but was not delivered until about the 28th or 29th of January. Of this $10,000 was issued to Sanger and paid for in cash, being the money obtained by Butt from the banks on Sanger's note and the accommodation notes above referred to. Another $10,000 of the stock was issued to O. W. Butt on January 28th, and paid for by his note for that amount, made payable to the Panhandle Packing Company, and indorsed by the Western Stockyards Company and A1 Popkam. This note was afterwards taken as cash by the creditors of the packing company and subsequently paid by the stockyards company and Popham. Of the $25,000 of stock, $2,000 was issued to Butt and paid for by him by a note for that amount, signed by Charles W. Sanger, but the stock was never delivered to either Sanger or Butt; $500 of the stock was issued to S. H. Madden on January 29th, and paid for in cash; another $500 of stock was issued to W. B. Slaughter on January 29th. This certificate was attached to a draft on W. B. Slaughter, but the draft was never paid. Upon its return Butt gave his note to the company for $500, which was held by the company, together with the stock, but the certificate of stock has never been delivered to any one. It was shown that ' W. H. Fuqua, the president of the First National Bank, was a director in the Panhandle Packing Company, and had knowledge of the manuer in which the stock was issued and how it had been paid for. At the time the $2,000 note above mentioned was executed by Sanger to Butt, an agreement was dictated with reference to the same ; Sanger testifying that the agreement was prepared after he left, while Fuqua testifies that it was prepared and signed beforehand. The court submitted the case on special issues, which together with the findings of the jury thereon are as follows:
"First. Was the remainder of the O. W. Butt S?5,000 stock in the Panhandle Packing Company placed within the meaning and contemplation of the parties Fuqua and Sanger, at or before the time the three banks placed the $10,-000 to the credit of said packing company, about January 27 to 29, 1910? Let your answer be 'Yes' or 'No.' " To which the jury answered; "Yes."
"Second. Did the defendant Sanger and Fu-qua, president of the plaintiff bank, after the transaction of January 15, 1910, treat the remainder of the $25,000 stock of O. W. Butt in the Panhandle Packing Company as placed within the meaning of the memorandum of January 15, 1910, signed by O. W. Butt, relating to .the $10,000 note of Sanger, introduced in evidence before you? Let your answer be 'Yes' or 'No.' " To which the jury answered: "No."
"Third. Did the defendant Sanger and O. W. Butt, or either of them, in the presence of and without objection . by the other, represent to W. II. Fuqua that the execution of the $2,000 note by Sanger and the memorandum of O. W. Butt, referring to the same, dated January 15, 1910, read in evidence before you, conclude the placing of the remainder of the O. W. Butt $25,000 of stock, and did the said Fuqua rely upon such representation, and cause the plaintiff bank to accept the said Sanger's $10,000 note and advance to O. W. Butt the $4,500, by placing the same to the credit of the Panhandle Packing Company on its books, and after-wards paid out the same on the checks of the said packing company? Let your answer be 'Yes' or 'No.' " To which the jury answered: "No."
"Fourth. Did the defendant Sanger and O. W. Butt, on or about January 15, 1910, make a complete and final oral contract, agreeing upon all of the terms of the same, with reference to Butt guaranteeing Sanger's stock, leaving nothing to be done but to reduce it to writing; or did they only come to an understanding and give to the attorney, S. H. Madden, general instructions for drawing the contract, leaving him to state the details, with the intention that no complete and binding contract should be made until the instrument was drawn and submitted to both of them for their acceptance or rejection? Let your answer be, 'They made complete oral contract,' or 'They waited for the written instrument to complete the contract.' " To which the jury answered: "They made complete oral contract."
"Fifth. Did the plaintiff bank have knowledge or notice of the existence of said guaranty agreement, if any, between Sanger and Butt, at or before January 29, 1910? Answer 'Yes' or 'No.' " To which the jury answered: "Yes."
"Sixth. Did Will A. Miller, Jr., J. W. Crudg-ington, H. B. Sanborn, M. O. Nobles, and the Western Stockyards Company, or any of them, have knowledge or notice of the alleged agreement and contract between O. W. Butt and defendant Sanger, by which the payment of said Sanger's $10,000 note might or could be avoided before or at the time they executed their respective accommodation notes offered in evidence before you? If all had notice, let your answer be, 'Yes;' if all were without notice, let your answer be¡ 'No.' If only a part had notice and others did not, then answer, naming the ones having notice and the ones without notice." To .which the jury answered: "No."
"Seventh. Did the National Bank of Commerce have knowledge or notice of the alleged agreement and contract between Butt and Sanger, by which the payment of said Sanger's $10,000 note might or could be avoided at or before the 29th day of January, 1910? Let your answer be 'Yes' or 'No.' " To which the jury answered: "No."
The court did not give in charge to the jury the law with reference to any of the issues.
Appellee objects to tbe consideration of all assignments based upon tbe refusal of tbe trial court to give special charges requested by appellant, upon tbe ground that the record does not show that these special charges were submitted to opposing counsel. Bach of the special charges has written upon the bottom of it by the trial judge, the following:
"Presented and refused before the main charge was read to the jury."
Each of the separate bills of exception taken to the action of the court in refusing the special charges have also the following notation by the district judge:
"The foregoing exception was taken at the time of the refusal of the said special instruction and before the delivery of the charge to the jury, and was overruled by the court, to which the defendant Sanger then and there in open court excepted."
We do not understand article 1973 R. S., as amended by Acts 1913, p. 113, to require that the party requesting the special instruction should submit it to opposing counsel, but we think that duty rests upon the trial judge. Such is the practice as to bills of exception. Vernon's Sayles' Civ. Stat. arts. 2063, 2064. This record shows that each of the special charges were presented to him, and we should presume that he has performed his duty and submitted it to opposing counsel. This holding is not in conflict with the holding of this court in the case of Gulf, T. & W. Ry. v. Culver, 168 S. W. 514; for in that case the bill of exception did not show it had been presented to the judge. The objection of appellant to the various assignments, based upon the action of the court in refusing the special charges, are all overruled.
By several assignments of error appellant contends because all of the stock to which Butt had subscribed had not been issued by the packing company and paid for, as required by article 12, § 6, of the Constitution of this state; that the stock had not been "placed" in accordance with law. We find this the difficult question in the case. The memoranda of January 15, 1910, provides that the note is not to become effective or binding until the remainder of the $25,000 of stock, to which Butt had subscribed, was "placed." The contention of appellant is that the answer of the jury to the first special issue, which is, in effect, that the stock had been "placed" within the meaning and contemplation of the parties, does not meet the law's requirements, and is immaterial. He insists that the stock must be placed in accordance with the constitutional requirement, regardless of whether it had been placed within the meaning and contemplation of Sanger, Butt, and Fuqua. It is said in Bailey v. Joy, 132 Mass. 358:
"The plaintiffs contend that the mortgages were 'placed,' within the meaning of the orders, when they were recorded, or at least when they were transferred, and that the defendant then became liable to a full amount of the mortgages. But it seems clear to us that this is not what the parties intended. If the orders had been to pay the plaintiffs' bills when the mortgages 'are placed;' with nothing more, it might have presented a more difficult question; but the added words 'and from the amounts realized from said mortgages above the amount due George E. Joy for land and advances' point very strongly to the conclusion that by 'placed' the parties meant 'sold' or 'realized.' Construing the words 'are placed,' in connection with the context, and also with the contract between doy and Tenney, to which the orders refer, it is clear that such was the moaning and intention of the parties."
We think the rule announced is applicable here. The memorandum of January 15, 1910, states that Butt desires to use the note with the stock attached in the way of collateral, for the purpose of procuring money from the banks or elsewhere, for the finishing of the packing plant. We must construe this instrument in the light of the surrounding circumstances, which appear from the record to have been known to all parties to the memorandum. Butt had subscribed for $25,000 of the stock of the packing plant and was unable to pay any part of it. It became necessary for him to procure other parties who would take and pay for the stock. Under the law, this could only be done by "money paid, labor done, or property actually received." Mason v. First National Bank of Paint Rock, 156 S. W. 366.
It appears that many of the citizens of Amarillo, including the parties to this suit, were interested in procuring the money necessary to complete the packing plant and put it in operation, and, as expressed in the written memorandum, it was especially the desire of Sanger and Butt. Of course, if the stock had already been acquired and paid for by Butt, it might be contended that the word "placed" had the meaning given it by appel-lee ; but before it could be placed it must be paid for and the certificate of stock issued by the company,- and this was the very thing Butt was endeavoring to have done. It appears from the record that the $2,000 note executed by Sanger to Butt had been delivered to the company; the certificates of stock had been issued and pinned to the note, but they had not been delivered to any one. It further appears that when the draft for $500 was made upon W. B. Slaughter, with the certificates of stock attached, and he had declined to honor the draft, Butt made his note and delivered it to the company in lieu of the draft, and in payment for the stock. This is clearly contrary to the law as announced in this state, and, under this state of facts, we can but conclude that at least $2,500 of the stock to which Butt had subscribed had not been placed when this suit was filed, and, as we gather from the record, cannot now be sold, since the plant has been sold under mortgages, and the com- ' pany is insolvent. They must be held to have contracted with reference to existing rules of law. If, upon another trial, the evidence is the same upon this issue, the court should direct a verdict in favor of Sanger as against all of the appellees having notice of the memorandum of January 15, 1910.
Several of the makers of the $1,000 notes testified that they had no actual notice of the memorandum. Appellant contends that Fuqua was the agent of all parties in taking and holding the note and memorandum, and that notice to him is notice to all. These issues were not submitted to the jury, and under article 1985, Vernon's Say les' Civil Statutes, we should presumé they were found in such manner as to support the judgment; that is, we should presume that the makers of the $1,000 collateral notes had no notice of the memorandum and afiirm the judgment as to them. But reference to their pleadings show no allegations of fraud or deceit or other grounds which would support the judgment in their favor against Sanger. Such being the state of the record, the judgment must be reversed, and the cause remanded.
Appellant asked the court to give several special charges, including one upon the burden of proof and the law with reference to the sale of corporate stock. Even if a case is submitted upon special issues, the court, if requested, should charge the jury with reference to the rules of law applicable to such issues, including a charge on the burden of proof. Texas Baptist University et al. v. Patton et al., 145 S. W. 1063; Southern Cotton Oil Co. v. Wallace, 23 Tex. Civ. App. 12, 54 S. W. 638; Cole v. Crawford, 69 Tex. 124, 5 S. W. 646.
The Amarillo Improvement Company is not a necessary party to the suit, and, having been dismissed by order duly entered, no judgment should have been rendered in its favor.
Several other matters are presented in appellant's brief which will probably not arise upon another trial, and will not be considered. Appellee insists that the obligation referred to in the memorandum of January 15, 1910, in that part of the instrument where it is said, "This obligation is not to become effective or binding until the remainder of my stock is placed," etc., has no reference whatever to the $10,000 note, but refers to the undertaking on the part of Butt to raise $10,000 to take out 100 shares of the stock in the packing company, in the name of Sanger, an,d then use the note with his other stocks to raise the money for finishing the packing plant. This theory has not been advanced in the pleadings, and no witness has testified to that effect; in fact, all the testimony in the record tends to show that the reference in the paragraph of the memorandum referred to is to the note, and it appears from the evidence of the parties to the memoranduni that they so considered it.
Reversed and remanded.
HENDRICKS, J., not sitting.