Harris v. Wheeler

255 S.W. 206, 1923 Tex. App. LEXIS 574
CourtCourt of Appeals of Texas
DecidedMay 30, 1923
DocketNo. 2142. [fn*]
StatusPublished
Cited by10 cases

This text of 255 S.W. 206 (Harris v. Wheeler) 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
Harris v. Wheeler, 255 S.W. 206, 1923 Tex. App. LEXIS 574 (Tex. Ct. App. 1923).

Opinions

BOYCE, J.

This suit was brought by L. Wheeler against R. T. Harris and 10 others to recover a commission, alleged to be due the plaintiff as broker, on the sale of an oil lease owned by the defendants. The plaintiff alleged that it was agreed between the plaintiff and the defendants herein that for his services in effecting said sale defendants would pay to the plaintiff $25,000 as his commission in that behalf and on the 15th day of September, 1919, the said defendant, R. T. Harris, acting for himself and the other defendants herein, executed and delivered to plaintiff an agreement in writing to pay said $25,000 commission, which agreement was in the following words and figures, to wit:

“Wichita Falls, Texas, September 15, 1919.
“L. Wheeler: I agree to pay you a commisr sion of $25,000 out of sale price of Gray Gander Oil Company, commission to be prorated as to cash payment and deferred payment; you to get your proportion of the cash payment and the balance out of deferred payments as they are made by the purchaser.
“[Signed] R. T. Harris.”

The oil lease was sold and conveyance thereof executed by defendants to one Langley for a consideration of $425,000; $100,000 cash, $50,000 evidenced by note, and $275,000 to be paid out of the oil production at the rate of $1.50 per barrel. The plaintiff received his proportionate part of the commission on the $100,000 cash payment, and the suit is to recover a balance alleged to be due on account of deferred payments received by the defendants under the following circumstances: Langley, after paying the $100,-000 cash payment, $50,000 note and other payments, which reduced the amount remaining due on the purchase price to about $240,000, defaulted and abandoned the property. Plaintiff received his proportionate part of the payments thus made by Langley, except that there was a balance due on this account amounting to $102.69. The defendants brought suit against Langley, who had left the state, and obtained judgment in rem, which established the balance due on the purchase price by Langley at the sum of about $240,000 and decreed the foreclosure of an equitable lien on the oil lease. On receiver’s sale of this property made under order of the court, it was bid in by the defendants at $100,000 and wras conveyed to them on this recited consideration. The receiver reported that the property had been sold at $100,000 cash, and the report and the judgment confirming the' sale recite that such sum is the fair and reasonable value of the property, though defendants offered testimony to the effect that the property was worth only about $10,000 and that the $100,-000 was bid merely for the purpose of forestalling any possible claim of sale at an inadequate consideration. The defendants, after spending considerable amounts in restoring the oil wells to production, sold the property at a price of $50,000.

This statement suggests the principal question of liability in the case, to wit, whether the plaintiff was entitled to commission pro rata on the $100,000, credited on the purchase price of the property on confirmation of the receiver’s sale and conveyance of the property to the defendants. The trial court held that he was, and rendered judgment for plaintiff accordingly. Another question presented in different ways is as to the liability of the defendants other than Harris. We make this further statement as pertinent to .the decision of the various propositions concerning the latter question stated. Plaintiff’s petition did not charge'that the defendants were partners; the allegation being that they were the owners of the lease, which was followed by the allegation as to the execution of the contract above quoted. The defendants denied partnership under oath, but did not deny under oath the execution by themselves, or by their authority, of the instrument executed by Harris and set out above. It was shown on the trial that the defendants owned undivided interests in the oil lease. Four of them owned one twenty-fourth each; two of them one-twelfth each; three of them one-ninth each; and two of them one-sixth each. They had been operating the property in the name of the Gray Gander Oil Company; Harris and another defendant, Pennington, being the active managers of the business. In the assignment of the lease, executed by all the defendants, it was provided that the $50,000 note executed by pang-ley should be payable to Harris, and that the other payments should also be made direct to Harris, who was thereby authorized to collect the same, execute all division orders and instruments necessary to obtain such money. Several of the defendants were present during the negotiations for the sale of the lease and knew of the agreement to pay the commission to plaintiff. All the defendants knew of the payments that were made to Wheeler from time to time and made no objection ihereto. The court found that—

“In executing this paper R. T. Harris, by custom, practice, and upon consent of said owners, operating under the name of the Gray Gander Oil Company, was acting for all of said owners and that they were acting thereby through R. T. Harris, and that same intended to and did bind all of said owners to pay said commission out of the proceeds of the sale of the property.”

*208 The court further found that the owners were acting, jointly in' the operation of the property and the judgment was against the defendants, jointly and severally.

A decision as to the liability of the defendants for a commission on the $100,000, for which the property was sold at receiver’s . sale, is not free from difficulty. Our construction of the effect of the contract is that the defendants’ liability for payment of commission existed only as payments were made on the sale price, and the question is whether this $100,000 is a deferred payment on the sale price made by the purchaser, within the meaning of the commission agreement. Technically, at least, we think it is. The lease was assigned to Langley, and it became his property, subject only to an equitable lien to secure the payment of the balance which he owed on the purchase price. The effect of the proceeding against Langley was to affirm the sale and to hold him to his liability for the payment of the balance of the purchase price. If this property or other property owned by Langley had been sold in satisfaction of a judgment against him, in a suit brought to recover balance due on the purchase, and bought in by some third person, at such sale, it could not be doubted that the money received at such sale would be a part of the purchase price of the lease and that plaintiff would be entitled to a proportionate payment of his commission out of the fund so realized. Why should the fact that defendants themselves bought the property make a difference? In either event Langley’s obligation would be reduced by the amount for which the property was sold, at such sale. Langley now owes about $140,000, balance of the purchase price of said property instead of $240,000 before the sale. He remains liable for the payment of this $140,-000. If it should be collected, plaintiff would be entitled to his proportionate part thereof. In the last-stated event, Langley’s obligation would have been completely satisfied, and yet plaintiff would not have received the full amount of his commission unless iie be entitled to collect commission on the amount for which the property was sold at judicial sale. In the case of Crane v. Eddy, 191 Ill. 645, 61 N. E. 431, 85 Am. St. Rep.

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Bluebook (online)
255 S.W. 206, 1923 Tex. App. LEXIS 574, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harris-v-wheeler-texapp-1923.