Court Opinion

ID: 3930077
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:55:35.59512+00
Date Added: 2024-06-11T14:16:42.259531
License: Public Domain

On Motions for Rehearing.
The first contention in appellant Willis' motion is because there is some evidence in the record showing that another suit is pending in a different court between Willis and the Careys to determine their respective rights and liabilities for the debts of the Carey Bros. Oil Company; that the matter should not have been determined in this case. If there is any such suit, Willis failed to plead that fact in abatement of E. S. Carey's cross-action against him here in, and has thereby waived it as a defense York's Admr v. Gregg's Adm'r, 9 Tex. 85; General Bonding 
Casualty Insurance Co. v. Lawson (Tex.Civ.App.) 194 S.W. 1020; Blassingame v. Cattlemen's Trust Co. (Tex.Civ.App.) 174 S.W. 900. Without deciding the question, we suggest that the bank, or even the other defendants, might have successfully resisted the attempt of Willis and E. S. Carey to litigate their purely personal matter in this suit; but their failure to do so is no ground for complaint by Willis, especially when by his answer and cross-petition he first injected the issue into the case by setting up his contract with E. S. Carey and affirmatively invoking the judgment of the court upon it. Having lugged it into the case himself, it does not lie in his mouth to complain of a judgment against him in a motion for rehearing, either in the trial court or in this court. If the court erred in adjudging the issue, he invited it, or rather compelled it. If all parties were willing to do so, the trial court, in the exercise of his discretion, could adjudicate any matter connected with or growing out of the same transaction in one suit. Coleman v. Zapp, 105 Tex. 491, 151 S.W. 1040; Id. (Tex.Civ.App.)135 S.W. 730. The court's action in doing so will not be reviewed here unless it has been properly excepted to by one who has not waived his right to object. Williams v. Baldwin (Tex.Civ.App.) 202 S.W. 975; Scott v. F.  M. National Bank (Tex.Civ.App.) 66 S.W. 485. Even if there is another suit for an accounting pending between the members of the firm of Carey Bros. Oil Company, it does not appear from the record in this case that the rights of Willis and E. S. Carey, under their personal contract, are in any way involved in it or that it is necessary to go into the partnership accounts to determine such rights. Peck v. Powell (Tex.Civ.App.) 259 S.W. 640; Rowley's Partnership, §§ 746, 748; 20 R.C.L.  Partnership, §§ 140, 151. The direful consequences which appellant suggests in his motion may result if this judgment is affirmed should have deterred him from inviting and compelling the court to adjudicate the issues in the first instance.
This court did not decide that there had been an accord and satisfaction between appellant and E. S. Carey, but the jury did, and, there being evidence to support the findings, we approve it. While on the witness stand, E. S. Carey denied that there was an accord and satisfaction of the matters pleaded by Willis, and the documentary evidence sustains him. This evidence, taken in its chronological order, is in substance as follows:
On May 20, 1920, E. S. Carey executed and delivered to W. T. Willis a plain promissory note for $2,000 and the record shows that it has been paid. Willis agreed in writing to assume and pay off as his own obligation the note executed by the Carey-Willis *Page 856 
Drilling Company to the Wichita State Bank  Trust Company, upon which E. S. Carey was liable as a partner, and the bank, by indorsement on the writing, accepted Willis as sole obligor and released E. S. Carey. On the same day, E. S. Carey delivered the following writing to Willis and R. M. Waggoner:
"This is to certify that I have received in full consideration for my interest in the $72,000 note executed by R. M. Waggoner and payable to W. T. Willis, dated October 8, 1920, and that I now neither claim, own or demand any amount from either of you by virtue of being at one time interested in the proceeds of said above described note."
E. S. Carey's plea of duress relates to these two instruments. On February 11, 1922, Carey and Willis executed in writing a full and complete settlement of all matters relating to the Carey-Willis Drilling Company, of which they were the sole owners, in which Willis paid Carey $200 and Willis assumed the outstanding indebtedness against that partnership. It appears that prior thereto on February 3d, the Careys had paid four-ninths of the note sued on to the plaintiff bank and obtained a written receipt therefor. On February 18, 1922, the City National Bank of Commerce executed a written release to the Careys of their liability upon a judgment for $29,903.30, which said bank held against the Carey Bros. Drilling Company, in consideration of the payment by the Careys of the sum of $11,274.88. This release, signed by the vice president of the bank, recites that the Careys are released except as to $2,222.20, and that there shall be applied toward the payment of said last sum four-ninths of the sale price of the oil and gas lease which is to be sold February 7, 1922, and if such price is insufficient to pay the pro rata balance due on the judgment from the Careys, then they are to pay such balance, and that if the lease sells for more than said sum they shall be entitled to such excess. The release further provides:
"This agreement of release shall in no wise affect the joint and several liability of W. T. Willis, J. E. Trigg, Guy Rogers, J. E. Childers, H. D. Lewis, and M. J. Michaelias as to the balance due on said judgment."
Before this release was delivered, it was submitted to the appellant Willis, and he agreed that its execution should in no wise affect his joint and several liability for the remainder of the judgment as to the bank, and recites further as follows:
"Without prejudice, however, to my rights of contribution against the said E. S. Carey, R. R. Carey and C. W. Carey, as to any amount which I may have to pay as an obligation of the Carey Bros. Oil Company, and shall not affect my right to contribution as against any of the other partners of the Carey Bros. Oil Company."
This agreement is appended to the release, and shows clearly that Willis reserved all rights against E. S. Carey. On October 18, 1922, the following instrument was executed by Willis and E. S. Carey:
"Whereas, in cause No. 11990-c, wherein E. S. Carey et al. are plaintiffs and T. T. Reese et al. are defendants, it appears that a conflict of interest may develop between plaintiffs W. T. Willis and E. S. Carey, both being represented by the same attorney: It is therefore agreed that as between said parties the judgment in said cause for an accounting and contribution shall not be conclusive and they expressly reserve the right, should they so desire at a later date, to litigate their respective rights as against each other pertaining to their interests in Carey Bros. Oil Company, in any subsequent suit in any court of competent jurisdiction and all pleadings as against each of said parties shall be withdrawn without prejudice to either of said plaintiffs."
Even if it could be contended that any of the instruments above mentioned amounted to an accord and satisfaction, this writing would set it aside and open the door to further litigation, and the fact that Willis has injected the issues between them into this case is conclusive against his contention that there was an accord and satisfaction. These documents corroborate E. S. Carey's testimony to the effect that there has been no accord and satisfaction, and the jury could not very well have found otherwise. It is unnecessary to discuss the sufficiency of the pleadings and the evidence upon the issue of duress in E. S. Carey's execution of the $2,000 note and the relinquishment of his interest in the $72,000 note in the matter of the settlement of the Carey-Willis Drilling Company partnership. That is another story with which we are not concerned in this case.
Guy Rogers and J. E. Childers, in their joint motion for rehearing, insist that because they indorsed the note, and because their names appear as indorsers after the signatures of the three Careys, they are entitled to recover against the Careys whatever amount they may have to pay, and that the judgment should be reformed here, entitling them to recover against all prior indorsers. There was no pleading by either of the Careys or any other codefendant, setting up any special agreement between the indorsers as to their liability inter sese. Their contention in this court is based upon V. S. C. S. art. 6001 — 64, of the Negotiable Instruments Act, which provides that —
"Where a person, not otherwise a party to an instrument places thereon his signature in blank before delivery he is liable as indorser, in accordance with the following rules: (1) If the instrument is payable to the order of a third person, he is liable to the payee and to all subsequent parties. (2) If the instrument is payable to the order of the maker or drawer, or is payable to bearer, he is liable to all parties subsequent to the maker or drawer. (3) *Page 857 
If he signs for the accommodation of the payee, he is liable to all parties subsequent to the payee."
Rogers and Childers pleaded that they were subsequent indorsers to the Careys. The bank sued all of the defendants, including Rogers and Childers, as partners and prayed for judgment jointly and severally against them as such. The suit was not against any of the defendants as indorsers. When Rogers, Childers, and Willis filed a plea in abatement alleging that there was another suit between the same parties involving the same subject-matter, wherein the bank was an intervener, it was agreed, as stated in the original opinion, that the bank would prosecute its suit against said defendants as indorsers only. Whereupon the plea in abatement was overruled. As stated in the original opinion, this stipulation binds only the bank. It could not affect the liability of the partners amongst themselves. The suit being against all the defendants, as partners, upon a note signed in the copartnership name, every member of the firm was jointly and severally liable for the full amount. Miller v. McCord (Tex.Civ.App.) 159 S.W. 159.
Where a note is executed by a partnership in the firm name and the partners indorse it individually, they become joint makers and are liable as such. Thompson v. Young, 90 Md. 72, 44 A. 1037; Burke v. Jefferson Bank, 121 Ark. 633, 180 S.W. 500.1 These appellants cite the case of National Exchange Bank v. Lubrano, 29 Rawle I. 64,68 A. 944, as being in point. Reference to that case shows that only one partner indorsed the note. The rights of several partners inter sese was not in the case and was therefore not discussed. We find the same state of facts in the case of Fourth National Bank et al. v. Mead,216 Mass. 521, 104 N.E. 377, 52 L.R.A. (N. S.) 225. What is said in that case, and also in the case of Faneuil Hall N. Bnk. v. Meloon, 183 Mass. 66, 66 N.E. 410. 97 Am. St. Rep. 416, with reference to a "person, not otherwise a party to an instrument," within the meaning of the above-quoted section of Negotiable Instruments Act, does not apply to the facts of this case. Since the Negotiable Instruments Act was not adopted from either Rhode Island or Massachusetts, the decisions of the courts of those states are not necessarily binding or persuasive upon the courts of Texas in construing the act. According to the Miller, Thompson, and Burk Cases, supra, every member of a partnership becomes a party to an instrument signed in the partnership name, since the payee of such a note is entitled to hold each partner jointly and severally. As stated, Rogers and Childers were sued as partners. They did not deny their liability as partners under oath, as required by the statutes (V. S. C. S. art. 1906, subd. 6), and having failed to do so, they cannot be heard to question the judgment of the court rendered against them as partners. Their unsworn plea setting up their rights as against their coindorsers could not be taken as a plea denying their liability as partners, even if they had verified it.
The motions for rehearing are overruled, and the judgment in the court below, less the amount remitted in this court, is affirmed.
BOYCE, J., not sitting.
1 Reported in full in the Southwestern Reporter; not reported in full in 121 Arkansas Reports.