Horn v. Builders Supply Co. of Longview, Ltd.

401 S.W.2d 143, 1966 Tex. App. LEXIS 2376
CourtCourt of Appeals of Texas
DecidedFebruary 24, 1966
Docket152
StatusPublished
Cited by25 cases

This text of 401 S.W.2d 143 (Horn v. Builders Supply Co. of Longview, Ltd.) 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
Horn v. Builders Supply Co. of Longview, Ltd., 401 S.W.2d 143, 1966 Tex. App. LEXIS 2376 (Tex. Ct. App. 1966).

Opinion

MOORE, Justice.

This is an action for the dissolution of a limited partnership under the provisions of Texas Uniform Partnership Act, Article 6132b, Vernon’s Ann.Tex.Civ.St. Plaintiffs, Mrs. M. Clint Brown, H. L. Smith, R. H. Smith, Raymond Cupp and James B. Cockrell, partners and owners of 98.7% interest of a partnership known as Builders Supply Company of Longview, Ltd., brought this suit against D. T. Horn, Jr., the owner of the remaining 1.3% interest, alleging that the defendant Horn had been guilty of such conduct as to prejudicially affect the carrying on of the business, and otherwise had so conducted himself in matters relating to partnership business that it was not reasonably practical to carry on the business and partnership with him; they alleged that at various times prior to the filing of this suit, Horn had appropriated to his own use and benefit partnership funds in the sum and amount of $13,606.92 and had failed and refused to account therefor. Plaintiffs prayed for á dissolution of the partnership and also asked that the value of Horn’s interest be ascertained and that he be paid such amount for his interest in the partnership, less the sum of $13,606.-92 alleged to have been appropriated by him.

*145 Defendant Horn denied that he had been guilty of any misconduct resulting in a breach of the partnership agreement. He alleged that he had complied with all of the terms and provisions of the agreement and stood ready and willing to continue with the partnership. By way of a counter claim, he sued for damages alleging that under the provisions of the agreement, he was promised a salary of $700.00 per month, but that the remaining partners had entered into a conspiracy and had wrongfully breached the agreement and terminated his salary as well as his expense account of $100.00 per month and because of such conspiracy and breach of the agreement on the part of plaintiffs, he suffered both actual and exemplary damages.

In a trial before a jury, facts were developed showing that on November 30, 1959, plaintiffs and defendant, by a written agreement, became partners in a limited partnership doing business under the name of Builders Supply Company of Longview, Ltd.

Under the provisions of the Articles of Partnership, James B. Cockrell and D. T. Horn, Jr. were designated as general partners, with all of the remaining members being limited partners.

In regard to the compensation to be paid the general partners, the Articles of Partnership contained this provision :

“In addition to the above, James B. Cockrell and D. T. Horn, Jr. shall draw a salary for their work in such amounts as might be agreed on from time to time by unanimous consent and agreement of all of the partners.”

Each of the general partners were full time employees of the business and drew a monthly salary. Horn’s salary was $700.-00 per month with an additional $100.00 per month as an expense account.

In June of 1962 serious difficulties arose between Horn and Cockrell involving the conduct of the business. Cockrell, one of the general partners and who was after referred by the other partners as the manager, advised Horn sometime during the month of July that his services were no longer needed and requested that he turn in his keys to the company automobile and vacate his office. This Horn refused to do, stating that Cockrell had no authority to terminate his employment with the company. Shortly thereafter, Horn entered the company offices and took from the safe the certificate of title to the company automobile used by him. He also took from the safe all of the abstracts of title to the company property and took them to his home. At the trial of this cause, he refused to turn them over to the company. He admits that even though he had no authority from any of the officials of the company, he took the company automobile to Houston, Texas, and on the return trip was involved in a collision and then, without the consent of the partnership, traded the wrecked automobile for a new automobile obligating the partnership for the difference. Upon learning that the company was attempting to sequestrate the automobile, he admits he secreted it and the company was finally forced to obtain possession through the courts.

He further admitted that on various dates prior to August 3, 1962, and on various other dates subsequent to August 3, he collected accounts due and owing the company in the amount of $13,606.92 and appropriated it to his own use and benefit.

On August 3, 1962, the partners held a called meeting which was attended by all members of the partnership, including Horn. At this meeting a motion was made that the salary and expense account of both Cockrell and Horn be terminated. All of the partners voted in favor of the resolution except Horn, who voted in the negative, taking the position that under the provisions of the Articles of Partnership, his salary could not be terminated unless there was a unanimous consent by all of the partners, and therefore since he did not consent, the company was without authority to terminate his salary prior to the expiration date of the Articles of Partnership on August 1, *146 1975. The company, nevertheless, terminated the salaries and expense accounts of both Cockrell and Horn, effective as of that date.

Despite the fact that his salary had been terminated, Horn continued to use the company automobile and continued to use the company’s credit card. He also continued to collect accounts due and owing the company and continued to appropriate the company funds to his own use and benefit. A few days prior to the date of the filing of this suit on October 26, 1962, Horn mailed the company an accounting, showing that he had collected the sum of $13,606.92 and also showing that he had applied a portion of the funds upon the salary which he claimed was due him, as well as paying himself a bonus and two paid vacations.

This suit followed shortly thereafter and in addition to a request for dissolution of the partnership also requested that D. T. Horn, Jr. be restrained from incurring further liability on behalf of the partnership.

In response to the following Special Issues as numbered in the Charge, the jury found, among other things, that: (3) defendant Horn had conducted himself in a manner relating to partnership business so that it was not reasonably practicable for the other partners to carry on business with him; (5) that the reasonable cash market value of his interest in the business was $9,409.63; (14) that the plaintiffs had conspired to breach the Articles of Limited Partnership; (15) that the acts of conspiracy of the plaintiffs in stopping the salary and expense account of Horn was a breach of the Articles of Partnership; (16) that the breach of the Articles of Partnership damaged Horn; (17) that such breach was a proximate cause of his damages; (18) that he had suffered damages in the sum and amount of $50,000.00.

Based upon the verdict, the trial court rendered judgment and also made the following findings:

(a)That defendant D. T. Horn, Jr. had conducted himself in a manner relating to the partnership business so that it is not reasonably practical for the other partners to carry on the business with him, and that such partnership should be dissolved as of October 23, 1964, the date of the verdict.

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401 S.W.2d 143, 1966 Tex. App. LEXIS 2376, Counsel Stack Legal Research, https://law.counselstack.com/opinion/horn-v-builders-supply-co-of-longview-ltd-texapp-1966.