Dean v. Allied Oil Co.

261 S.W.2d 900, 1953 Tex. App. LEXIS 2030
CourtCourt of Appeals of Texas
DecidedOctober 22, 1953
Docket3114
StatusPublished
Cited by22 cases

This text of 261 S.W.2d 900 (Dean v. Allied Oil Co.) 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
Dean v. Allied Oil Co., 261 S.W.2d 900, 1953 Tex. App. LEXIS 2030 (Tex. Ct. App. 1953).

Opinion

McDONALD, Chief Justice.

This is a suit in which the appellee' as plaintiff filed suit against the appellants Dean and Evans, as defendants, upon a guaranty-surety agreement executed by them. The parties will be denominated hereafter as in the Trial Court. Defendants and the wife of one defendant were sole owners of the Debco Petroleum Corporation, which became indebted to plaintiff for a large sum of money. This indebtedness was reduced to a note, secured by a chattel mortgage on all the property of Debco Petroleum Corporation; and also a collateral agreement whereby defendants would turn over a service station to plaintiff when called on to do so was entered into. Plaintiff and defendants jointly employed an attorney to prepare the note and agreement and defendants signed the note as President and Secretary-Treasurer of the Debco Corporation for and on behalf of the Debco Corporation. The note was in the principal amount of $30,483.48, provided for interest at 6% and provided for an additional 10%. upon principal and accrued interest as attorney’s fees if the note be not paid at maturity and be placed in the hands of an attorney for collection. After the signatures and acknowledgment of Dean and Evans on behalf of the Debco Corporation there appeared: "For value received, we,, J. L. Dean or W-esley D. Evans or both of us, do hereby personally bind ourselves, our heirs and assigns, and do further guarantee the payment of the above mentioned note and do hereby promise to pay Allied Oil Company or order $30,483.48 or such amount that remains to be paid at maturity, or at any time thereafter, with interest at the rate of 6% per annum, until paid, waiving demand, notice of non payment and protest.

Address 5505 Hiway 9 /S/ J. L. Dean J. L. Dean
Address 1824 Elizabeth /S/ Wesley D. Evans ' Wesley D. E^ans.”

The Debco Corporation defaulted on the note. Plaintiff filed suit jointly against the Debco Corporation, and the defendants individually. Thereafter Debco Corporation filed a petition in bankruptcy, and plaintiff abandoned its cause of action against the Debco Corporation. The Referee in Bankruptcy abandoned the property plaintiff had a mortgage on after having it appraised and ascertaining that it was worth less than that which it was security for. Plaintiff then foreclosed its note and bought said property in at the valuation placed on it by appraisers appointed by the Referee, crediting the Debco note for said amount. Plaintiff thereafter sold some of the properties for more than the appraised value, some for less than the appraised value; and still has some of the properties in hand.

Trial was to the court and jury. At the. close of the evidence the Trial Court withdrew the case from the consideration of the *902 jury and entered judgment for plaintiff against Dean' and Evans for $7,501.67, which- was the amount due on the note after credits had been allowed. This amount included attorney’s fees due on the note together with interest at the rate of 6% per annum.

Defendants appeal to this court on 3 points, to wit: 1) That the Trial Court erred in withdrawing the case from the jury and rendering judgment for plaintiff, because defendants pled and presented evidence that the guaranty was not supported by consideration, was executed with the understanding and agreement that defendants would not be personally liable, and that it was obtained by fraud — all of which defendants contend were disputed fact issues they are entitled to have the jury pass on. 2) That if the defendants are liable under the guaranty — the court erred' in giving judgment for the full amount of the balance due on the note as defendants are not liable for attorney’s fees under the guaranty —and defendants are entitled to further credit on the note to the extent of the additional value received by appellee from the sale of the property abandoned by the Referee in Bankruptcy. 3) That the court erred in overruling defendants’ 2nd Amended Motion for Continuance.

As to defendants’ 1st Point — In passing on the question of whether the court erred in withdrawing the case from the consideration of the jury and rendering judgment for plaintiff, it is well settled that where a finding by the jury either way on disputed fact issues could not change the judgment, which as a matter of law must be entered in the case, then the court is under a duty to withdraw the case from the jury and to render the proper judgment therein.

Defendants contend that the surety-guaranty agreement was not supported by consideration — The guaranty signed by defendants was an obligation of a corporation of which they were sole owners (except 1%, which belonged to one of defendants’ wife). While Dean and Evans, under these circumstances, were the actual beneficiaries, such is-not necessary. Consideration to support their surety-guaranty agreement exists by reason of the benefit accruing to the Debco Corporation. The surety agreement was made contemporaneously with the execution of the note by the Corporation. It was a part of the note before its delivery to and acceptance by plaintiff. To support a contract of suretyship-guar-antyship it is not necessary that any consideration pass’ directly to the surety. A consideration moving to the principal alone will support the surety. Bonner Oil Co. v. Gaines, 108 Tex. 232, 191 S.W. 552.

As to the contention of defendants that the surety-guaranty was executed with the understanding and agreement that they would not be liable thereon, and that it was obtained by the fraudulent representation that they would not be looked to for payment, there are no pleadings to support this issue. Further, an examination of Dean’s own testimony reflects that any representations made to him or Evans were made by his attorney and not the plaintiffs. Moreover, there is no showing of any reliance on the representations. But even had defendants offered proof under proper pleadings that plaintiff had induced defendants to sign the note by a false representation — that he would not be personally liable thereon — or made an agreement or had an understanding to that effect, and had the jury so found, it still would avail defendants nothing. An unconditional written instrument cannot be varied or contradicted by parol agreements or by representations of the payee that the maker would not be held liable according to the tenor of the instrument. Mitcham v. London, Tex.Civ.App., 110 S.W.2d 140; Cooper Co. v. Smith, Tex.Civ.App., 126 S.W.2d 518; Crumpler v. Humphries, Tex.Civ.App., 218 S.W.2d 215.

In Distributors Investment Co. v. Patton, 130 Tex. 449, 110 S.W.2d 47, 48, where the assertion was that certain promises were made contrary to the written agreement, the Commission of Appeals said:

“These representations were specifically negatived by the writing, and, if *903 by denominating them fraud the written contract may be set aside, then a written contract is of no higher dignity than an oral one.

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Cite This Page — Counsel Stack

Bluebook (online)
261 S.W.2d 900, 1953 Tex. App. LEXIS 2030, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dean-v-allied-oil-co-texapp-1953.