Dorton v. Chase

262 S.W.3d 396, 2008 Tex. App. LEXIS 5036, 2008 WL 2629576
Court of Appeals of Texas·Decided July 2, 2008·No. 10-07-00098-CV·Published·Cited by 16 cases

Opinions

OPINION*

TOM GRAY, Chief Justice.

Thomas Chase and Parrish Todd Dorton had a business relationship. They were also friends. When the business relationship soured, so did the friendship. They eventually entered into a Settlement Agreement. But Chase then sued Dorton over a debt on bank notes which Chase paid and alleged that Dorton owed. Dor-ton agreed that he owed the debt, unless he was excused. As defenses to the lawsuit, Dorton asserted four ways he was excused from paying the debt: assumption; waiver; estoppel by contract involving a memorandum signed by Chase; and estoppel by contract involving a Guaranty Agreement signed by Chase. Dorton also filed a counter-claim against Chase for breach of contract for not complying with the Settlement Agreement. After a trial on the merits, a jury agreed with Dorton on the assumption and the two estoppel by contract defenses. The jury also agreed that Chase breached the Settlement Agreement. The jury did not find for Dorton on his waiver defense. The trial court, however, granted Chase’s motion for judgment notwithstanding the verdict and rendered a judgment in Chase’s favor. Chase was also awarded attorney’s fees.

On appeal, Dorton argues that the trial court erred in granting Chase’s motion for judgment notwithstanding the verdict as to [398] Questions 1(a) (assumption), 1(c) (estoppel-memorandum), and 1(d) (estoppel-Guaranty Agreement). Dorton only needs to prevail on any one of the three defenses on which the jury answered yes: assumption, estoppel by contract (memorandum), and estoppel by contract (Guaranty Agreement) to reverse the trial court’s judgment. Alternatively, in his second issue, Dorton claims he should prevail as a matter of law on the issue of waiver to which the jury answered “no” (Question 1(b)), and to which Dorton filed his own motion for judgment notwithstanding the verdict. Dorton’s motion was denied. Dorton further contends on appeal that Chase is not entitled to attorney’s fees and that he, Dorton, is entitled to his attorney’s fees.

Chase submits two counter-issues which attack the submission of the assumption defense to the jury. His third counter-issue attacks the trial court’s denial of his pretrial motion to determine that the Settlement Agreement was unambiguous.

We reverse the trial court’s judgment.1

Assumption

At the end of the trial, the court overruled Chase’s objection to the submission of Question 1(a), assumption, to the jury on no evidence and insufficient evidence grounds. After the verdict, the trial court granted Chase’s motion for judgment notwithstanding the verdict as to the jury’s affirmative answer to Question 1(a). Chase and Dorton complain of each action, respectively.

The trial court is required to submit questions to a jury which are raised by the written pleadings and the evidence. Tex.R. Civ. P. 278. To sustain the action of the trial court in granting a motion for judgment notwithstanding the verdict, we must determine that there is no evidence upon which the jury could have made the findings relied upon. Dowling v. NADW Marketing, Inc., 631 S.W.2d 726, 728 (Tex.1982).

The jury was asked in Question 1(a) if Dorton’s failure to pay the notes was excused by Chase having assumed Dorton’s obligation to repay the notes in a memorandum signed by Chase. The jury was instructed that the failure to pay the notes was excused if Chase assumed Dor-ton’s obligation to pay. Assumption was defined in the charge as the “unequivocal intent to become personally liable for the debt to the holder of that debt.” Neither party objected to this definition.2 When there is no objection, it is the court’s charge that measures the sufficiency of the evidence. Osterberg v. Peca, 12 S.W.3d 31, 55 (Tex.2000).

In deciding whether or not Chase assumed Dorton’s obligation to pay the notes, the jury was authorized to interpret a memorandum to Central National Bank from Chase. The memorandum provided:

You are authorized to release to Parrish Todd Dorton the shares of common [399] stock of Chase Financial Corp. and to renew his two notes for a year without principal or interest payments. Insurers Opportunity will execute a new note purchase agreement and Tom Chase will generate the payment of the renewed notes.

It was signed by Chase as the president of Insurers Opportunity Corporation in March of 2003. The specific day of March was left blank.

The memorandum itself is some evidence of an unequivocal intent by Chase to become personally liable for the debt. As stated in the memorandum, Insurers Opportunity was to execute a new note purchase agreement and Chase would generate the payment of the renewed notes. Chase argues on appeal that the term “generate” does not mean he assumed the notes. When no definition is given in the charge, jurors may use any reasonable, ordinary, or common understanding of the words used. See Taylor v. Lewis, 558 S.W.2d 153, 159 (Tex.Civ.App.-Amarillo 1977, writ ref d n.r.e.) (A juror of average intelligence would be presumed to construe the use of a word in its usual and ordinary sense.). Generate is defined as “to be the cause of (a situation, action, or state of mind).” MeRRIAm WebsteR’s Collegiate Dictionaey 485 (10th ed.1993). According to the charge, the jury was free to interpret the phrase “Tom Chase will generate the payment of the renewed notes” as an admission that Chase would “be the cause of’ the payment. In other words, Chase would make the payment of the renewed notes.

At trial, Chase did not controvert the memorandum. He only testified that he did not remember reading the memorandum. He said that someone at Central National Bank must have drafted it, but was then reminded that a representative of the bank testified at a deposition that no one at the bank drafted the memorandum.

Further, the testimony of Todd Moore, a former president of Central National Bank, also presents some evidence that Chase assumed Dorton’s obligations to pay on the notes. Moore was particularly familiar with the policies and procedures of the bank when it came to making loans. He understood that it was the policy of the bank to send out notices when notes became due. The bank’s system automatically generated a notice 10 days prior to a payment due date or maturity. It then generated past-due notices for 10 days and then 30 days past the due date or past maturity. The loan officer would decide whether or not to send these notices.

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Dorton v. Chase, 262 S.W.3d 396, 2008 Tex. App. LEXIS 5036, 2008 WL 2629576 (Tex. Ct. App. 2008).

262 S.W.3d 396 (Dorton v. Chase) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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Dorton v. Chase
262 S.W.3d 396 (Court of Appeals of Texas, 2008)