*1 verdict, especial- resolved be must juror if, upon issue, ly in- material misconduct, and the extent fluenced at all of such influence is immaterial. ab- that ease that further held in ju- of misconduct sence of actual effect emphatic ry most they be established cannot by jurors called are denials made to was, account; least there where substantially ef- reasonable doubt conduct, improper after the verdict fect of the appellate agrеed upon, is re- court transpiring
quired treat the occurrence during jury, prior to deliberations of reaching verdict. practice, further discussion self-serving declara- the court jurors, hearing discussion of extrane- tions of verdict, matters ous were not thereby, but influenced governed by evidence, are not conclusive. opinion Moore Oase based Gray, Ry. on H. & T. C. Co. v. 105 Tex. 606; Southern Traction v. Wil
143 W. Co. S. 1104; (Tex. App.) W. Hines son v. Com. 254 S. App.) 886; Parry (Tex. Com. S. W. (Tex. San Antonio Traction Co. Cassanova App.) 1190; H. 154 S. Steelе Co. W., Civ. v. Dover W. (Tex. App.) Civ. W. (Tex. App.) Civ. S. Yanez v. Traction Co. 1176. complained think the matter We proposition reversible tenth error. and remanded.
Reversed al. v.
CONRADS et KASCH.
No. 7318. Appeals of Texas. Austin. of Civil
Court 19, 1930. Feb.
Appellee’s March 1930. Motion Overruled April 9, Appellant’s Overruled Motion *2 Kaseh, price, prayed accounting for an specified amounts, for the properties value of all than at less their fair value. *3 response plea In in abatement Kaseh, corporation all of stockholders parties. madе were Some of the other 35 thereupon, February, stockholders in joined against Kaseh cross-action Barber, Jr., Johnson, G. remaining Will T. and in this suit. C. de- stockholders Marcos, appellants. join parties, for original of San clined to both either of said case, March, finally and the tried to a in Cunning- Marcos, MeKie, and of San E.R. special issues, was 35 and submitted on Antonio, Johnson, ham, San of & Moursund upon their answers thereto the trial appellee. for Kaseh; rendered this favor hеnce in of appeal. BAUGH, complete Kaseh had control of .the conduct were, Kaseh and Ed. 1921 H. Conrads In of the office and the sales the seed to been, years prior had thereto for and several public. paid salary by corpo- He was breeding, growing, and engaged partners in ration for his All services. the other direc- high-grade planting selling June, seed. cotton farmers, tors and were stockholders none corporation known formed was 1921 a gеneral whom resided in San Marcos. In Farms,” Pedigreed Seed as the “Kaseh offices San stock of of business was conducted as Breed- follows: capital Tex., Marcos, and with ing grown seed were Kaseh and 15,000 $30,000, shares divided into 1,200-acre on their farm near San Marcos. stock Kaseh subscribed Of this each. corporation, These were sold 4,242 4,243 for shares. and Conrads shares in turn furnished them to numerous farmers in small was subscribed remainder growers, known as and most through- ' farmers amounts out that thе Kaseh was agreements whom were territory. corporation This growers these either and Conrads. Kaseh seed business year tion for such seed or return it that director, general president, a crop grown bushel for from there- bushel corporation manager from its business growers from. These to sell to contracted June, 1924. in its dissolution formation until grown those meeting November on stockholders’ theAt' corporation. furnished These seed represent- shares were agreed upon, public generally were turn sold to the for ed, was and and the planting ginning seed. At the close of the made between Kaseh season, readily could ascer- whereby present Kaseh was' then stockholders to continue delivery, tain how much seed it had for corporation as business of the also how orders then on hand year, fiscal i. end of that theretofore to apparent for those seed. When it became pur- e., May 31,1924, and at that time was suрply that the for was sold cost, on a less a assets basis chase reasonable dissolution its out, agents usually informed, depreciation. Certificate only grown orders to be the next for seed secretary of state sent to the subject accepted, and 4, 1924. corporation in same case cancellation May Kaseh on Conrads filed not be filled it because circum- could among things, (cid:127)29,1926, alleging, other beyond control. stances its effecting of said the dissolution Appellants’ contention first agreement made with the stock- and in his relationship Kaseh November, 1923, Kaseh, said holders in stockholders, especially all its under the corporation, being complete control of said case, liquidating facts of this busi its only cognizant of and in all its assets one trustee, ness, being duty, that .of a it was occupied books, business and of all its benefit, them for his in make full own relationship fiduciary to the other stock- disclosure of all facts hоlders, in effect a trustee for became affecting dealings; their entire liqui- corporation dating for its stockholders in question, burden called rested preparatory to final dis- its business him to the fairness of such sale to capacity guilty ; in that solution that advantage him, corpora trust, alleging of his breaches various way. tion was taken information from said Conrads withheld he and particular stockholders as what con- circumstances of this Under (cid:127) case, think assets we stitutеd the are correct. same, etc.; Kaseh, he acted in if it be bad concededthat value This true even faith; pos- he obtained title to and of November wholly inadequate dealing such, at a assets session the stockholders as nothing; (10) through acting season were worth not witli the planting upen bargaining undoubtedly seed so taken over directors. He acquir- such dissolution worth interest himself and his own ton; (11) viz. about $05 All of the ing the assets of the February that 15, 1925, knew on or knew whom most of оr should have known exercise of or the business about the little assets of the diligence, presi- reasonable to taken over therefor; of the failute of Kasch account general stockholders assets dent, manager, of the busi- in control by him, and what was fair value astute ness and books of the (12) that known what was as the man, business and Intrusted Aldridge contract, being growing a seed con- complete control directors with all but 30, 1922,by tract' made on in- October Many did the of thе stockholders all its affairs. negotiated though dividually, of the purpose *4 not know beforehand prop- individual 5, was the meeting of November stockholders’ erty Kasch; (13) of that from that contract meeting, between At with dissension that during ap- Kasch majority 1923 benefits of realized Conrads, who Kasch owned and proximately $11,000; (14) Kasch that and stock, power Kasch with the of (sales manager B. A. Stuffleheme for the cor- away corporation the to take from the poration) received commission of for under and trade-name to use his trade-mark which all other tive but to also intrusted the paratory corporation’s Aldridge; sale of the seed to sold, planting seed were (15) delay of all practically no alterna- stockholders had their suits Kasch under the cir- agree a dissolution. Kasch delay. cumstances an unreasonable winding up of affairs with 1923, 5, pre- early evidence, after November shows that as as Au- 1923, gust, preparatory сorporation already had or- assets, remaining planting taking all ders for all over seed it would re- growers; ceive his control and their- value that fall from its contract which were under Undoubtedly, agents actually by we and the sales him. fixed field were instruct- August, 1923, ed accept trustee for Kasch think he became a not to except orders crop. conveyed stockholders. Tenison those to and for other See be filled out of the 1924 92, 95; information, Patton, 284, howevеr, This 14a Tex. 95 was not duty the stockholders 112. As it was his C. only November meeting. 5th Kasch full and fair of all -testified to make that he ad- did assets, values, etc., vise the stockholders at facts as to that time material to that adequate price crop 1923 was sold out. all such But he a fair and for said by him; November, either to the stockholders at af- and was assets firmative dealings 1923, meeting duty or to much when directors on to show as June question. hand, about'the amount orders on were called se- expense corpora- cured and at the sufficiency question The next raised crop. to be filled out of the 1924 Orders findings support certain evidence to the the October, were obtained at the Dallas Fair in jury. substantially found 1923, and at the Cotton Palace at Waco im- (1) agreement of That the November follows: 5, it, mediately following aggregating $160,- over corpora- in the assets of the included planting seed, kept 000 worth of and orders purchased stock; Kаsch all seed tion to coming up in on to June 1924. Kasch used substantially complied (2) that many profitably continuing of these orders agreement; meeting (3) that at the selling personally the seed business after said 5, 1923, the stockholders knew November dissolution. Kasch admitted that on Novem- pro- in the assets Kasch was included what posed 1, 1923, fairly ber he-could have arrived at a over, but did not know their to take accurate determination from the books in his agreement value; (4) fair аnd that said possession profits of what would be the net stockholders; (5) that beneficial to price paid the' corporation’s year, business for- -that fiscal things agreed he and also the fair value of its assets. But he adequate consideration full to do' did not furnish such information to the stock- assets; corporate (6) that direc- for 5, 1923,-or holders on November thereafter. corporation on June tors dissolution hand, he On the stated -to them then corporation, аpproved liquidation that, upon corpora- presented to them Kasch show- statement business, pro- tion’s he complied ing manner he posed thought -they to make with he (7) agreement November that his at cent, cent, per per realize from 85 to 95 knowledge directors had time said that capital of showed on profit their investment. Yet books nature, amount, quality, and fair ito the as' January 1, 1924, operating net by Kasch; so taken of the assets over value aрproximately per cent. price paid (8) therefor that appears that, value; (9) also when reasonable that formed, planting there were no orders on hand was for on hand taken orders seed, by. physical following assets trans- used over ing corpora- stock, a small knew little Kascb amount who ferred tbe remaining $6,140. Tbe the assets tion were valued business, goin¾ showed, or entire matter to Kasch. The $23,800 tbe and was what the books but intrusted “good value tbe affirma as tbe record on tbe books carried will” of sucb November, 1924, tively ing no annual show business. statements June, directors in the condition of the ever and of tbe stockholders; sucb made Kasch mentioned time Kascb value, gave spite requests item, some from considered its information, and for such none ever made. wbo were tbe doubtless knew anything, records, contracts, books, little, etc., sucb All if of the cor any poration appears matters, whatever as to werе Kaseh’s hands no information and it of the bounds, tbe business about a after dissolution asset. Yet within sucb books, records, etc., grown by leaps paying such lost or de tion bad cent, stroyed, except approximately divi- in 1923 orders for seed taken -24, dissolved, dend, band, orders and bad on records related to planting dealings ,of individual bushels thousands Practically orders testified be canceled source Kascb seed. for out of tbe 1924 procured 30,000 have bushels of could from Kasch or su'ch information was between fill, crop from records under con which be could He and at tbe trol. admits bad been secured did furnish them and which information, of the material of tbe *5 duty was his affirmative to furnish. The on is that there was not controverted rely upon had stockholders deal to him to 4, 1924, hand bushels seed 923½ them, fairly with cor the corporation from there was due tbe and that poration and to make full disclosure of growers bushels seed contract Many such matters. to of them no had occasion in fall to to it tbe were be delivered they into look the matter until made were also abundant orders there parties is, think, this im to suit. And it we dispose all sucb at on band to may desig material as to what this suit be per Kascb took over all bushel. Yet about these orders without ers and ; sounding in it nated effect an action in notice to the stockhold- fraud; and neither limitation nor laches compensation to the without began to run until such fraud was discoverеd tion, except 275 all tbe seed bushels should, care, ordinary in the exercise of bushel, approximately $1 and used them For, been discovered. have as stated jury found that fill orders. But to those Williams, Judge Patton, supra, in Tenison nothing, he worth that tbe orders always subject “such a transaction is to be against value for the seed. As examination, ed to the closest testimony, was not all sat- prejudicial which is between those situated thirty matters, isfactory more than on these cоrporation to be the should held to be practically who knew of the stockholders ”*% * upon it. fraud assets business, except trial, what of another we refrain from nor conduct view say discussing that was testified further that it than Kasch said at the ing the evidence told findings be- November about seed sufficientto sustain the proposed pur- jury in Kasch on of the issues submitted to included that, they chase, known such that them. thousands of orders be ‘the were to seed and included, charging There no error they agreed would have not to the individually jury Kasch that owned the trade Many proposed Kasch. them tes- terms under mark and trade-name were which the they did learn of facts such tified that sold We think the and that the joined shortly they before Conrads until his suit that n conclusively that, evidence corporation Kasch, against testified conducting used its busi same any they such nbt have information did only as in this licensee. And connection ness we find shortly before the time trial in until excluding that no there was error in 1928. testimony proffered by effect to the wholly representations prospec Not does the evidence were made to that finding support jury stockholders, of disclosure fail either Kasch or with tive approval, prior incorporation, full and fair Kasch made cor poration organized material facts to not it does but would become finding alleged support No owner of trade-mark. fraud is stock, attempt have or should discоvered failure to of such knew in the sale made to cancel years subscriptions representations before do so cross-actions two on more than against grounds. him. Conrads Such filed original years formed, in less than two un after the it bind after stated, upon-by adopted As im- dissolution. or acted it. 14 O. less pleaded stockholders hold Nor evidence each ques- property knew about which Conrads doubtless title signed corpo- agreement of sale bill when he the fаct view of January 5, Kasch ration with author- of the business Kasch on to the izing contract, clearly and trade-name as- the trade-mark barred and Conrads personal prop- four-year expressly as the both stat- reserved the two and erty utes of limitation. true as Kasch. The same is also to his suit to rescind the of sale made bill contract, Aldridge jury The found that the Kasch and dated Conrads to the individually, was to own which XCaschclaimed procured September 13, 1922, contrаct be- and as to the corporation; at the Sep- tween Kasch dated divided Stuffleheme Kasch and and that commission tember with reference to the for seed sold to of $450 pleadings attacking trade-mark. These denied belonging specifically instruments until were not filed proper was a both. Neither January, yet party to was a against both inured both facts instruments familiar with all patent benefit; did that he Kasch’s not advise surrounding Clearly plea their execution. Novem- stockholders either the good years limitation of even four June, ber, 1923, the'directors as to them. Nor positively trial. denied items he books showed we assume can such made full and fair other than Conrads did jury he charges. found that Yet file their cross-action until appel- February 15, yeai-s more than two contradictory con- There are other lants. dissolution. The found that should but, findings, fusing of a reversal in view February have known discussed, grounds undertake we shall not Kasch had not accounted them out here. for the set full value of the assets taken over finding finding him. This followed a laches limitation and issues of accounted, creates, had so if not a con Appellants since insist remain. flict, uncertainty at least meant as to what is property over taken title to all claims stated, it. As heretofore these stockhold stock made with the *6 ers were farmers who had to do with approval 5,1923, and the holders on November operation business, the of the the intrusted him, payment there of the distribution for, necessary management Kasch, entirely and control to it the directors on June testified, as them doubtless appellants same aside be to set would not have known what the books showed recover, this and that therefore could in fore carefully'. if will not testimony bearing upon had examined them We for rescis nature of an action action is sion and statute of cannot attempt to discuss the voluminous four-year cаncellation, it this issue. Suffice applies. With we limitation this say opinion that, in to that we are agree. four- well settled that the It is relationship par view of the of Kasch to these apply for rescis statute to a-suit does ties, inability opportunity their and lack of grounds action of fraud. But sion on the done, finding of to discover what he had damages governed deceit is for fraud and jury the their cause of above would bar referred to which n by two-year of limitation. Gordon statute supported by action is not Rhodes, 300, 40; Tex. v. W. 102 Tex. 116 S. evidence, and we cannot sustain it. (Tex. App.) 212 Co-Op. Inv. Civ. 231 S. v. Clark Co. finding presented The next issue is the 381; 246; (Tex. App.) W. W. Id. S. Com. plaintiffs the guilty eross-action (Tex. App.) S. Civ. Hendricks v. Martin delay of unreasonable not against W. 1047. The cause of action asserted February 15,1927, suit to under the facts was, think, rescis neither one for we cáse; this and that filing and circumstances same original urged appellants, solely sion, one fox- as was true of not cоnversion, by Kasch, rather as insisted May 29,1926. prior to amounting one a of fraudulent deal ings him with the not harmonious The decisions are such, the statute of limita stockholders. As urged as to whether laches can be as years apply. would Kasch con tion tinued the business of the two equitable coming within defense in case corporation until specific provision limita of a statute of a 4,1924, in no its dissolution on June event Martin, 267 S. W. tion. Hendricks v. begin agree citing would to run until his limitation Appeаls, of Civil the Amarillo Court finally taking expressly ment support thereof, consummated numerous cases property over the not that in cases defense does held apply. ever, that, such such be, oi-iginal petition May 29, general filed how The rule seems years thereafter, and, within inexcus two has been an as to whei-e there grounds special alleged, delay, therein limitation did able circumstances exist think, however, inequitable run. Al- We that as to the to enforce whiсh make dridge contract, right asserted, avail which attacked until the defense of laches is pleading February 12,1927, able; his amended filed and that same is not determinable en tirely by period limitation fixed stat dated October dealing pe affirmatively But, statutory limitation case he must ute. riod has not defendant where the upon elapsed, incumbent with the stockhold- it is prove plead prima extraordi both to ers. His do failure to so would make him, grave nary against work a which would facie case of constructive fraud circumstances injustice upon entitling appellants damages. gen- such a defense Eldridge him to render The El 256; proof C. See 21 eral burden of as available. to the amount 215; App.) damages Min dridge (Tex. chew v. Morris Winters v. Coward appellants 259 S. W. Civ. could recover would con- (Tex. App.) upon throughout Civ. tinue to rest the case. them W. (Tex. App.) right showing S. Civ. Their fidu- after recover ciary burden relationship Kasch met that do not think 941. We аs of Kasch to them against handling the prima own conduct facie estab- would be corporation and affairs lished in the one under a burden instance resting circumstance upon the stockholders. which in our evidence Kasch. The amount of opinion any hard recovery general work would still be under ship upon destruction proof appellants. the loss or resting upon burden of occurred the books of the being of the trial cor appellee, against take re poration himself he was for which damage being and all the elements close Certainly premature de sponsible. loss or ly is, case, that related to the main issue by him records valuable struction of such should charged that of fraud constructive appellants’ against not militate against Kasch, improper to under we deem it rights mis him for his own recover separate ques take to as to and affirm case conduct. jury relating partic tions submitted to the stated, judgment of the For the reasons ular assets taken over Kasch. reversed, remand- and the cause trial court is opinion We also another trial. are that as to ed for contract, dated October remanded. Reversed and the bill of sale from Kasch and Conrads Rehearing. On Motion September 13, 1922, and dated appel- rehearing, the contract between Kasch and the In his motion for September 14,1922, placed dated defenses burden lee insists that we have on him to show the amount, has if limitation to all estab- import appellants. damaged law; is, Such lished as a matter of fiduciary .opinion. rela of our tionship Because of his rescind such contracts appellants, damages flowing af contracts them- stated, duty, make dis selves. be elim- firmative closures These items should therefore upon inated of material facts to another trial. *7 bargaining for; property he was whose in If But limitation as matter adequate рrice. addition, therefor apply law items material failure to make procuring con agree facts the stockholders induced tract, nor to the division between Kasch otherwise would not Stuffleheme of the commissions on the seed agreed to, conduct would constitute have in Aldridge. sold items, denied both these effect, Judge Teni- stated Williams in may therefore be assumed Patton, corpora supra, upon a fraud son v. the books did were If them. such' items adequаcy tion, irrespective price paid improperly If, after dissolution. he on the other for the assets directors, that matter concealedfrom its hand, full disclo he did make facts would be admissible on the issues of fair agree material facts sure of the disclosure; and full and limitation ment er took in paid dissolve the but thereaft recovery would not run until advantage reposed of the trust same were discovered discovered. should have been evaluating faking assets, over and price therefor, inadequate charge. guilty either still the same Motion overruled.