Sims v. Dempsey-Tegler & Co.

487 S.W.2d 824, 1972 Tex. App. LEXIS 2908
CourtCourt of Appeals of Texas
DecidedNovember 22, 1972
DocketNo. 15084
StatusPublished
Cited by1 cases

This text of 487 S.W.2d 824 (Sims v. Dempsey-Tegler & 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
Sims v. Dempsey-Tegler & Co., 487 S.W.2d 824, 1972 Tex. App. LEXIS 2908 (Tex. Ct. App. 1972).

Opinion

KLINGEMAN, Justice.

Appellants, Marjorie Burg Sims, Harry Sims, Martha Ann Vaughn Mabe and husband, William Robert Mabe, and Leo T. Peterson and wife Lorraine Peterson, filed separate law suits against appellee, a brokerage firm dealing in stocks and bonds on a nationwide basis, for losses allegedly suffered by them as a result of appellee’s failure to honor their orders to transfer their stocks to another brokerage firm within a reasonable period of time. The suits were consolidated, with trial before a jury. Based upon the jury’s verdict, the trial court entered judgment that appellants take nothing.

Appellants contended in the trial court that thirty days was a reasonable period of time to transfer stocks from one brokerage firm to another; that on or about December 15, 1968, all of appellants requested that their stocks be transferred to another brokerage firm; that appellee took a considerable length of time to transfer their stocks, ranging from approximately three months to approximately eight months ; that the stocks were declining in value during all of such period of time; and that the losses suffered by them were the difference between the values of the stocks from a period thirty days after their request to transfer was made, and the values of the stocks on the day they were actually [826]*826transferred. One appellant, Marjorie Burg Sims, also asserted that appellee failed to tender or deliver to her twenty shares of Texaco stock owned by her, resulting in damages to her in the amount of the value of said twenty shares.

In answer to the only two special issues submitted to the jury, the jury found that thirty days was not a reasonable period of time for appellee to transfer all the stocks in question to another brokerage firm; and that appellee did not fail to tender or deliver to appellant, Marjorie Burg Sims, or her agent, the twenty shares of Texaco stock.

Although much of the testimony pertains to the question of what constituted a reasonable time for one brokerage firm to transfer stocks to another firm, with varying and conflicting testimony in regard thereto, appellants make no complaint on this appeal with regard to the jury’s finding to Special Issue No. 1, wherein the jury found that thirty days was not a reasonable time for appellee to transfer all of the stocks in question to another brokerage firm.

By three evidentiary points of error, appellants complain that the trial court erred: (1) in refusing to admit into evidence a financial statement of appellee dated June 1, 1969, (2) in refusing to admit into evidence an accounting report pertaining to appellee made by Peat, Marwick, Mitchell & Co., Certified Public Accountants, and (3) in improperly allowing an expert witness to testify as to what constituted a reasonable time for the transfer of stocks, based upon hypothetical questions propounded to him. By their last point of error, appellants complain that there is no evidence to support the jury’s finding that appellee did not fail to tender or deliver to appellant, Marjorie Burg Sims, or her agent, twenty shares of stock (Special Issue No. 2).

We first consider appellants’ no-evidence point of error pertaining to the jury’s answer to Special Issue No. 2. The stock in question consists of twenty shares of Texaco stock owned by Marjorie Burg Sims, as the result of a two-for-one stock split in July, 1969, which Mrs. Sims was entitled to by virtue of her ownership of twenty shares of Texaco stock. Mrs. Sims testified that she had never received such twenty shares of stock, and that such stock was never tendered or delivered to her by appellee. It appears from the record that Mrs. Sims held twenty shares of Texaco stock in her account with appellee when she requested a transfer of all of her stock to another brokerage firm on December IS, 1968. • The record indicates there was a two-for-one stock split of Texaco stock, with the effective dates concerning this split being: the record date, July 10, 1969, and the payable date, August 8, 1969. There is testimony that while the stock was in the possession of appellee on July 10, 1969, that on the payable date for such stock split, August 8, 1969, Mrs. Sims’ stock was no longer in its possession, but had been transferred to another brokerage firm at Mrs. Sims’ request. Appellee contends that since the stock was not in its possession or control on August 8, 1969, the payable date of such stock split, it was no longer up to them to obtain the additional twenty shares of stock, but up to either Mrs. Sims or the broker who held her stock on such date.

While the testimony is in some respects conflicting, it cannot be said that there is no evidence to support the jury’s finding to Special Issue No. 2, and there, is more than a scintilla of evidence to support such finding. Appellants’ point of error that there is no evidence to support such jury finding is overruled.1

We consider next appellants’ evidentiary points of error. Points of error Nos. 1 [827]*827and 2 complain of the court’s refusal to admit into evidence a financial statement distributed by appellee to its customers, dated June 1, 1969,2 and a letter report of an accounting firm addressed to Norman S. Swanton, Liquidator, pertaining to a financial questionnaire to appellee, dated August 20, 1970.3 It is appellants’ contention that such financial statement and accounting report show a chaotic condition existing in appellee’s business, including inadequate accounting records, and inadequate internal controls; and that they were relevant and material evidence with regard to the question of what constituted a reasonable time for appellee to transfer stocks to another brokerage firm. Appellee, on the other hand, contends that there was no proper predicate for the introduction of such exhibits; that insofar as this case is concerned, they were hearsay and that they were irrelevant, immaterial, prejudicial, and inflammatory.

It is to be remembered that appellants tried the case on the theory that any period of time in excess of thirty days was unreasonable, and the only special issue submitted in this regard inquires as to whether thirty days was a reasonable time for appellee to transfer all the stocks in question to another brokerage firm.4

Appellee contended that due to the nature and complexity of the many different stocks involved in the various accounts to be transferred, it would take over thirty days to transfer all of the stocks involved, even in the most efficiently operated brokerage firm. It asserts in this connection that the standard to be used in determining whether or not thirty days was a reasonable period of time was the standard of the industry at this particular point in time.

The testimony shows that in the accounts here involved, there were various and sundry stocks; some were over-the-counter stocks; some, New York Stock Exchange stocks; some, American Stock Exchange stocks; some, odd-lot stocks as contrasted with even-lot stocks; some, American Depository Receipt stocks; at least one, a foreign stock; some, marginal accounts; and some, recently purchased stocks. There is testimony that during the period of time here involved, there was a particularly heavy volume of business throughout the stock industry; and that in the transfer of securities during this time, there were serious delays throughout the industry.

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Bluebook (online)
487 S.W.2d 824, 1972 Tex. App. LEXIS 2908, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sims-v-dempsey-tegler-co-texapp-1972.