Allis-Chalmers Manufacturing Co. v. Curtis Electrical Co.

264 S.W.2d 700, 153 Tex. 118, 1954 Tex. LEXIS 501

• Court: Texas Supreme Court
• Decided: February 10, 1954
• Docket: A-4310
• Status: Published

Opinions

Mr. Justice Wilson

delivered the opinion of the Court.

The parties will be identified as in the trial court. See 259 S.W. 2d 918 for opinion of the Court of Civil Appeals.

Plaintiff furnished electrical equipment used by the Curtis Electrical Company (a corporation) as electrical subcontractor in the construction of dormitories upon the campus of the Agricultural & Mechanical College of Texas. Although the Curtis Company defaulted in their payment, the plaintiff did not comply with Art. 5160, V.A.C.S. This suit is against Curtis’ bonding company upon the theory that the bond was not a statutory bond and against Charles E. Curtis individually on a promise to guarantee personally the debt. If the bond falls within Art. 5160, V.A.C.S., there can be no recovery against the surety company. Fidelity and Deposit Company of Maryland v. Big Three Welding Company, 151 Texas 278, 249 S.W. 2d 183.

Plaintiff contends that the bond is not within Art. 5160 because the building was financed by the sale of revenue bonds under Ch. 5, Acts of the Second Called Session of the 43rd Legislature; Ch. 204, Acts of the Regular Session, 44th Legislature ; and Ch. 459, Acts of the Second Called Session of the 44th Legislature. Vernon’s Am. Civ. Stat. Art. 2603c. The question is whether buildings constructed under these acts are the result of “a formal contract with this state or its counties or school districts or other subdivisions thereof or any muncipality therein for the construction of any public building.” Plaintiffs say that because the state is exempted from liability the Board of Directors of A. & M. College acts as a separate entity in issuing revenue bonds for the building of dormitories. We agree with the Court of Civil Appeals in overruling this contention and hold that the Board of Directors of A. & M. College is an agency of the State within the meaning of Art. 5160 in erecting a dormitory upon the campus of A. & M. College to be financed by revenue bonds issued under the statutes cited above. See cases cited and discussed by the Court of Civil Appeals and see also State of Arkansas v. State of Texas, 346 U.S. 368, 74 Sup. Ct. 109, 98 Law Ed. 71.

On September 19, 1939 plaintiff billed Curtis upon “Regular terms; Net cash 30 days payable in Milwaukee-Chicago-New York Exchange.” On September 25th Curtis wrote plaintiff that he would personally guarantee a 30-day trade acceptance due October 31, 1939, in the amount of $5,990.43. On October 4, 1939, plaintiff wrote Curtis asking for a check in the amount of $1,352.72 and execution of a trade acceptance due October 31st in the amount of $5,000.00, but by mistake sent a trade acceptance in the amount of $6,000.00. On October 9, 1939, Curtis wrote plaintiff returning the $6,000.00 trade acceptance and suggesting a 60-day trade acceptance in the amount of $5,000.00 due December 1, 1939. On November 3, 1939, plaintiff wrote Curtis a letter containing the following statement:

“* * * we attach new trade acceptance for $5,000.00 dated October 30 due November 30 which we suggest you now execute and return to us * *

Curtis did not execute this trade acceptance.

The effect of this negotiation was that Curtis started off with a request that his payment be delayed for 30 days from September 25th. This delay was achieved as a result of the negotiation about mistakes in the account. Had Curtis’ first offer been accepted he would have had to pay this account on October 25th. On October 4th plaintiff wrote asking for a trade acceptance due October 31st. On October 9th Curtis suggested a 60-day trade acceptance due December 1st. Since the period was actually 51 days this amounted to an offer to predate the instrument. Plaintiff’s reply to this was its trade acceptance dated October 30th and due November 30th. This amounts to a substantial meeting of the minds. In the ordinary course of business this account should have been paid by October 19th. A difference of one day in the maturity is not substantial since Curtis did gain the delay he was seeking. There is no proof that the one day difference materially affected the parties or adversely affected Curtis in any manner. This cause of action is not upon the acceptance itself but upon Curtis’ promise to endorse it personally.

The judgment of the Court of Civil Appeals is reversed to the extent that it denies a recovery against Curtis personally in the amount of $5,000.00 and judgment is here so rendered. Costs are taxed against Chas. E. Curtis.

Opinion delivered February 10, 1954.