Coleman Nat. Bank v. McDonald

286 S.W. 487, 1926 Tex. App. LEXIS 667
CourtCourt of Appeals of Texas
DecidedJune 15, 1926
DocketNo. 6988. [fn*]
StatusPublished
Cited by5 cases

This text of 286 S.W. 487 (Coleman Nat. Bank v. McDonald) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Coleman Nat. Bank v. McDonald, 286 S.W. 487, 1926 Tex. App. LEXIS 667 (Tex. Ct. App. 1926).

Opinion

McCLENDON, C. j.

Appellee, S. McDonald, brought this suit against appellant, Coleman National Bank, of Coleman, Tex., to recover the sum of $1,216.95, alleged balance owing by appellant to appellee upon deposit account. Appellant defended upon the grounds, among others, first, that the account sued upon was a partnership account of appellee and his son, A. H. McDonald, and appellee could not, recover because A. H. McDonald was not a party to the suit; and,'second, that the balance it owed the partnership was only $416.95, which amount it tendered into court in the form of a cashier’s check, made payable to the partnership, and indorsed by A. H. McDonald. This check was accepted by appellee, and credited upon the amount in controversy. Appellee replied to this pleading, denying the partnership, and asserting that the balance was incorrect, in that two checks which will be hereafter noted, aggregating about $800, had been improperly charged to the account.

There was a trial to a jury upon special issues, and upon their answers judgment was rendered in favor of appellee against appellant for $583.05. The appeal is from this judgment.

The evidence will warrant the following findings of fact in support of the trial court’s judgment:

S. McDonald, who lived at Comanche, Tex., was engaged in the business of buying and shipping cotton. He had buyers in a number of cities, among them his son, A. H. McDonald, the arrangement with whom was that appellee furnished the money and A. H. McDonald did the buying, and the net profits were shared equally. On October 1, 1924, appellee wrote a letter to appellant, proposing the opening of a cotton account with it on the basis of one-eighth of 1 per cent, on. exchange, and 8 per cent, interest on daily balances. The following day he wrote another letter to appellant, advising that—

“Mr. A. H. McDonald has authority to check upon me at your bank for the payment of cotton with collateral attached, together with authority to pay for all expenses incidental to the movement of such purchases, and such as f. o. b. charges, telephone bills, sampling, hauling, weighing, when such checks show for what purpose they are given.”

On October 3,' 1924, appellant replied to the first of these letters, agreeing to carry the account on the terms stated, except that-exchange should be at one-fourth instead of one-eighth of 1 per cent. It was also stated that the bank would “like to have fairly liberal margin at all times.” In response to this request, appellee made a margin deposit of $1,000 on October 13, 1924. This account was carried on the books by appellant in the name of “S. McDonald, Special,” until the'cotton account was finally closed the following spring; the deposit receipt bearing the notation “margin on cotton a/c.” Another account was opened in the name of “S. McDonald Cotton Account,” and was later changed to “S. McDonald & Son Cotton Account”; -the circumstances of the change not *488 being important' to tins appeal. During tbe ensuing cotton season a large amount of cotton was purchased by A. H. McDonald, and various checks and drafts were drawn on the cotton account and deposits made thereon. At times the account was overdrawn many thousands of dollars. When the account was finally closed it showed on overdraft of $583.05. This overdraft was by appellant charged to the margin account, leaving a balance in that account of $416.95, which was covered by' the cashier’s cheek above noted. No question was raised as to the correctness of the account, except as to two cheeks, which were drawn by A. H. McDonald and charged to this account. One of these checks was dated January 25, 1925, and payable to J. T. Saunders for the sum of $625. It was signed “A. H. McDonald,” and had pencil notation, “Chg. S. McDonald Cotton A H M.” The undisputed evidence showed that this cheek was drawn to pay an individual note of A. I-I. McDonald which had been purchased by Saunders, who was an employe in the Coleman bank, and that the bank and its officers knew these facts. The other check was dated December 29, 1924, and paid January 2, 1925. It was signed “A." H. McDonald,” with pencil notation “Chg. S. McDonald & Co.” It was in favor of Crespi & Co., or order, and for the sum of $174.18. The undisputed evidence showed that this check was drawn to. pay an individual indebtedness of A. H. McDonald, and that this fact was known to the Coleman bank and its officers. The evidence shows in regard to these two checks that A. H. McDonald discussed with the cashier of Appellant the matter of paying them out of the cotton account; there being some question as to his authority to pay his individual indebtedness in this way. The cashier asked him whether he had a profit due him from the partnership sufficient to cover the ¿mount of the checks, and, upon being told that he had, he thereupon told him that the cheek might properly be drawn on that account. As soon as S. McDonald ascertained that these checks had been charged to the cotton account, he demanded that the account be corrected and credited to the extent of these charges.

There was a conflict in the testimony as to whether the business conducted by S. McDonald and his son showed a profit; and there was also a conflict in the testimony as to whether the $1,000 margin account belonged to the business conducted by S. McDonald and his son, or was the individual money of S. McDonald. We think it unimportant to detail the evidence in these regards, since the fact questions which they presented were concluded by the findings of the jury.

The two issues were submitted to the jury, resulting in the following findings: (1) That appellant and A. H. McDonald were partners in the cotton business at Coleman, Tex., at the time the two.checks in question in the suit were given’ and paid by the Coleman National Bank; (2) that the $1,000 margin deposit was the individual property of ap-pellee.

Appellant presents twelve assignments of error which raise four issues.

By the fifth, sixth, seventh, ninth, and tenth assignments error is predicated upon the refusal of certain special issues and special charges relating to the matter of partnership. Since the jury found this issue in favor of appellant, the rulings complained of, if in fact erroneous, were rendered harmless.

The eighth assignment complains of the refusal to submit the issue whether there were any partnership profits, and, if so, what amount. Appellant’s contention in this regard is that, if there was a profit in the partnership business sufficient to pay the individual checks of A. H.. McDonald, then it had a right to charge those checks to the partnership account. There is no merit in this contention. If appellant desired to subject the partnership assets to the individual debt of A. H. McDonald, it would have been necessary to make him a party to the suit. This would involve a partnership accounting, and, assuming appellant’s right to require such accounting in this proceeding, certainly it could not be had without having all partners before the court.

The first, second, fourth, and eleventh assignments complain of the refusal of a peremptory instruction and of the judgment on the ground that the uncontradicted evidence showed that the $1,000 margin account was a part of the general cotton account, was merged into it, and was therefore a partnership asset which could not be recovered without making A. H. McDonald a party to the suit. The uncontradicted evidence shows that the margin account Was carried in the name of “S.

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286 S.W. 487, 1926 Tex. App. LEXIS 667, Counsel Stack Legal Research, https://law.counselstack.com/opinion/coleman-nat-bank-v-mcdonald-texapp-1926.