Thraves v. Hooser

44 S.W.2d 916
CourtTexas Commission of Appeals
DecidedJanuary 6, 1932
DocketNo. 1496—5776
StatusPublished
Cited by44 cases

This text of 44 S.W.2d 916 (Thraves v. Hooser) is published on Counsel Stack Legal Research, covering Texas Commission of Appeals primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Thraves v. Hooser, 44 S.W.2d 916 (Tex. Super. Ct. 1932).

Opinion

SHARP, J.

W. V. Thraves brought this suit against John W. Hooser, and in substance alleged that the suit was based upon a contract made in the form of a letter dated January 6, 1925, and thereafter amended. This contract is made part of the petition and marked Exhibit A; that Hooser was the owner of certain oil leases in Navarro county and other parts of Texas; that by the letter he agreed with Thraves that a Delaware corporation should be chartered with a capital stock of $5,000,-000 par value, divided into shares of $100 each, and these shares divided into two sections of 100,000 shares of class B voting stock and 490,000 shares class A stock. This letter provided that when the corporation should be properly chartered Hooser should transfer his interest in certain oil leages and three-fourths of his interest in certain other oil leases, for which he was to receive all of the capital stock of the corporation, except qualifying shares of directors; that when he had done this, Thraves should sell a sufficient amount- of the stock at not less than 65 per cent, of its par value to pay Hooser a million dollars. Hooser' reserved the right to transfer all of his interest in the properties to the corporation to which he had agreed to transfer three-fourths of his interest. The proceeds of the sale of all stock were to be delivered to him until he received one million dollars, and, when he had received that million dollars, he was to transfer one-half of all the unsold stock to Thraves. This contract was amended as shown by Exhibit B to plaintiff’s petition, which provided that all advertising and all articles for publication pertaining to the company or its officers should first be submitted to Hooser or his general counsel before released for publication.

On January 26, 1925, the agreement was further amended by an agreement entered into between Hooser and Thraves wherein it was recited that it was found expedient to amend the two agreements of January 6th and 7th, respectively, hereinabove mentioned. This agreement was for the purpose of embracing the contract between J. K. Sague and Thraves in the contract between Hooser and Thraves, and the agreement between Sague and Thraves was made a part of it and marked Exhibit A to the contract dated January 26, 1925. In the amended contract dated January 26, 1925, it was agreed that the contract entered into by Thraves with Sague for the sale of the stock was in compliance with the terms and provisions of the contract expressed in the letters or contract of January 6th and 7th. It was further agreed that in consideration of Hooser having given his consent to changes in the charter, stock, etc., Hooser, at any time he should desire, could withdraw any or all of the stock Thraves was empowered to sell under the original contracts and amendments, and that, should he do so, he should credit the stock on the amount he was to receive under the original contract at 65 per cent, of the par value until the consideration had been paid in full. It was recited that this agreement was necessary for the proper interpretation of the agreement made with Sague.

In the latter agreement, it was provided that Hooser could withdraw his stock from sale at the wholesale price thereof; that is, at the price Sague and his associates would have to pay Hooser in the event the stock should be sold at the market price fixed by Hooser. It was also agreed that, if at any time he desired to do so, Hooser could retain the stock in lieu of any part or all of the money consideration named in the contract at a price of 65 per cent, of its par value, regardless of the market value of the stock. It also provided that Hooser should have all the rights and privileges of naming the price at which the stock should be sold, withdrawing it from the market, etc., set out in the contract between Thraves and Hooser.

It was provided in this contract that, in the event Thraves had not completed the marketing of the stock by January 1, 1926, the' contract with all of its amendments should terminate at the option of Hooser. The contract further provided that the capital stock •of the proposed company should be 600,000 shares of the par value of $5 each; that the present provision for voting the stock should be abrogated and all stock to be of one class; that the Hooser Oil Company should place in escrow in a trust company of its own selection 100,000 shares of the stock to be marketed by Sague and associates at a minimum price of $3.25 per share. It was provided that the price of the first 20,000 shares to be sold by Sague should be fixed absolutely at $3.25 per share. It was further provided that as to any other unsold balance above this 20,000 shares Hooser should, at any time his discretion might dictate, increase the price at which it was to be sold; Hooser to receive from the price so fixed by him 65 per cent., and the balance of 35 per cent., to go to what was called the Marketing Syndicate.

[918]*918It was further provided that Sague should' within thirty days prepare a campaign for the marketing of the stock, and at the conclusion of sixty days from the date of the signing of the contract turn into the treasury $100,000, the proceeds of 20,000 shares, and thereafter a minimum of $50,000 per month until 100,000 shares should be disposed of, and, in case of failure to do so, the agreement should be canceled.

These instruments sued upon„were attached to the petition and made a part of it. The market value of the shares of stock was alleged to be $5 each, and Thraves sued to recover the market value of the shares aggregating $894,230.

Hooser answered by various exceptions and special pleas, and denied that he repudiated the contract as alleged; that he was able and willing to perform his part at all times, and alleged specifically the contract with J. K. Sague made a part of plaintiff’s petition, and alleged that Sague violated this contract by refusing to carry out the same, .and that Sague demanded that Hooser issue false and fraudulent shares of stock to various persons. Such persons have indorsed their certificates to the New York Trust Company and deposited there, and that 5,000 shares of stock be issued and delivered to Sague in order that he might falsely and fraudulently transfer it on the stock exchange and make it appear that the stock was active and desirable ; and that he had further demanded of Hooser that all of the stock be deposited in the New York Trust Company, all of which demands were unwarranted by the contracts between the parties, and that Hooser notified Thraves and Sague that he would not issue such fraudulent stock, whereupon they notified Hooser that, unless such changes in the contract were made and such conditions complied with, no further effort would be made to sell the stock, and that this constituted a breach of the contract so as to excuse Hooser from further performance.

In a supplemental petition, Thraves denied under oath that J. K. Sague or J. K. Sague and associates was or were the agent or agents' of Thraves in any sense, and especially denied the alleged agency. It was further alleged by Thraves that if J. K. Sague or J. K. Sague and associates did any of the things alleged by.Hooser, and if such conduct constituted a' breach of the contract, nevertheless Hooser waived such breach, treated the contract as continuing, acted thereunder, and thereby caused Thraves to rely upon the fact that the breach was waived, and was estopped to claim or enforce the same; that the sale of the properties by the Oil Company, and the acts of Hooser in causing same, rendered it impossible for either Thraves or Hooser to perform the contract, and constituted a breach by defendant.

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44 S.W.2d 916, Counsel Stack Legal Research, https://law.counselstack.com/opinion/thraves-v-hooser-texcommnapp-1932.