191 S.W. 1133 | Tex. | 1917
Lead Opinion
We copy the following statement of facts from the opinion of the Court of Civil Appeals:
"Appellants owned about 50,000 acres of land in Scurry and other counties, which they contracted to sell to appellees. The contract was entered into on October 27, 1906, and was evidenced by a writing of that date. The price to be paid by appellees for the land was $6.50 per acre. They paid $10,000 on the purchase price at the time the contract was executed. By the terms of the contract $15,000 of the part remaining unpaid of the purchase price was to be paid May 11, 1907, and the remainder thereof at later dates. It was stipulated that in the event appellees should violate any of the terms and conditions of the contract and `fail to perfect, consummate and carry out' same, the $10,000 paid by them should not be `considered or become a partial payment upon the lands,' but should be `received, held and kept' by appellants as liquidated damages. The $15,000 due by appellees May 11, 1907, was not paid by them then nor afterwards. On that day appellant Tillar and his attorney and appellees Baker, J.F. O'Neal and W.E. O'Neal had a conference in Mineral Wells. The testimony as to what then occurred was conflicting. That on the part of appellants was that Tillar then demanded payment of the $15,000, and appellees refusing to pay, that he declared their rights under the contract to have been thereby forfeited. That on the part of appellees was that payment of the $15,000 was waived by Tillar, and that he agreed to go to Kansas City and act for them in closing a deal they claimed they had pending there with one Allen and one Rule, subject to an arrangement with Tillar as to certain details not specified in the testimony, whereby Allen and Rule were to assume their contract with appellants and pay them (appellees) the sum of $25,000. As a result of the conference, on the Monday following said Saturday Tillar and Baker and J.F. O'Neal did go to Kansas City, where negotiations between Tillar *253 and Allen and Rule were carried on, resulting in the consummation on May 22 of a contract between Tillar and Allen and Rule, whereby appellants sold the land to Allen and Rule, and agreed to convey same to Allen for $6.50 per acre, the price appellees had agreed to pay for it, and $15,000. Appellees claimed that it was understood and agreed between themselves and Tillar that they should own all in excess of $6.50 per acre Allen and Rule might agree to pay for the land, that Tillar, in negotiating and consummating the sale to Allen and Rule, acted for them as well as for appellants, and that they were entitled to demand and receive of appellants as their own the excess over $6.50 per acre realized by appellants as a result of the sale to Allen and Rule. Their suit against appellants was commenced and prosecuted on this theory. Appellants denied the existence of such an understanding and agreement, and, among other things, claimed that appellees were advised by Tillar two days before he consummated the sale to Allen and Rule that he denied their right to any of the proceeds of the sale he was negotiating, and would refuse to account to them for any part of such proceeds. The sale by appellants to Allen and Rule was entirely on a credit, — the purchase price being represented by Allen's promissory notes secured — except $15,000 thereof — by a vendor's lien on the land; and part of them — including said $15,000 — being further secured by the guaranty of Rule and a pledge of certain life insurance policies issued to him. The $15,000 referred to as not secured by a vendor's lien was represented by notes in favor of appellee R.B. Pyron, who claimed same was paid to him by appellants on account of an indebtedness they owed to him as the result of other transactions between them. Appellants, however, claimed the $15,000 was paid to Pyron as a commission for his services in connection with the sale made to Allen and Rule. Appellees' suit was to recover the $10,000 paid by them to appellants at the time the contract of October 27, 1906, was entered into, and the excess over $6.50 per acre in addition to said $10,000 received by appellants on account of the sale to Allen and Rule. They obtained a judgment against appellants for the sum of $25,000 and interest thereon from May 11, 1907."
The Court of Civil Appeals made a very clear statement of the facts of this case, and pronounced a judgment which was sustained both by the findings of the jury and by the law, whereby they affirmed the judgment of the District Court. Subsequently, upon a motion for rehearing they set their former judgment aside, and entered judgment reversing and remanding the case to the District Court for another trial.
It will be necessary, in a brief way, to review the facts as they are presented in the first opinion of the Court of Civil Appeals. The contract, as it is stated in the opinion of the Court of Civil Appeals, between Bush and Tillar and the two O'Neals and Pyron, was to the effect that the $10,000 which was paid by Pyron and his partners on the purchase of the land should not be entered as a credit upon the purchase price, but should be appropriated as damages for the failure to *254 comply with the contract. This contract provided what should be the penalty of a failure to comply, and made the forfeiture of the $10,000, if it should occur, the compensation for a failure to make the payment in accordance with the contract.
We are of opinion that this had the effect to deprive Bush and Tillar of the right to rescind the contract for the sale of the land. They provided their remedy by the appropriation of the $10,000 as damages for the failure of Pyron and the O'Neals to perform the terms of the contract. They could not have damages for the failure to perform the terms of the contract, and at the same time destroy that contract.
If Bush Tillar had the right to disaffirm the contract or set it aside on the failure to pay the $15,000 as agreed to, and if when the parties met and the matter was discussed among them they agreed upon a different procedure, whereby Bush Tillar undertook for their debtors to carry out a transaction which the latter had made with other parties in Kansas City, then, we think, there can be no controversy that by accepting such agency and agreeing to act with the Kansas City parties as substitutes for Pyron and his partners, Bush Tillar waived their right of forfeiture altogether.
Pyron and his associates, anticipating the failure to be able to meet the contract, had made an agreement with certain parties in Kansas City, whereby it was agreed that those parties should take the land that Pyron and the O'Neals had bought from Bush Tillar, and be substituted in the place of Pyron and the O'Neals, assuming their indebtedness to Bush Tillar and taking the benefits of the contract between Bush Tillar and the O'Neals and Pyron.
This was explained to Bush Tillar at their conference, and it was agreed by the parties that Bush Tillar would accept the substitution of these parties for Pyron and his partners. By this agreement Bush Tillar certainly became the agents of Pyron and the O'Neals for the accomplishment of this purpose. Bush Tillar held the legal title to the land in themselves, and they had the power to convey that title at the request of the owner of the equitable title, and they undertook to do just what the law authorized them to do, that is, by agreement of the owner of the equitable title one who holds the legal title can convey it, and invest the legal and equitable title in his vendee.
It is a well settled rule to which there is no exception that one who undertakes to act as agent or trustee for another can not appropriate the benefits of such transaction to himself. On the other hand, he must give to the principal for whom he acts the benefits and advantages, and if he appropriates the same he is liable to the principal, who may recover the thing appropriated or damages sustained by the act.
We can see no room for argument or discussion of this case as to the wrongful act of Bush Tillar in appropriating to themselves the interest of Pyron and the O'Neals, consummating in their own names the identical transaction which they assumed and undertook to complete in the name of and for the benefit of Pyron and the O'Neals. We know *255
of no authority in law or equity that will sustain any such action by an agent. Good faith on the part of the agent must be observed, and any violation of it will subject him to an action by the principal in order to adjust the rights between them. Such agent must answer to his principal fairly, truly and justly. Messer-Moore Ins. Co. v. Trotwood Park Land Co.,
"The relation of an agent to his principal is ordinarily that of a fiduciary, and as such it is his duty to act with entire good faith and loyalty for the furtherance and advancement of the interests of his principal in all dealings concerning or affecting the subject matter of his agency, and if he fails to do so he is responsible to his principal for any loss resulting therefrom, or the principal may repudiate the acts of the agent and recover back any money or property paid him, less the agent's proper charges and compensation; and an agent who has defrauded his principal can not set up the negligence of such principal as a defense to an action for an accounting." 31 Cyc., p. 1430.
The facts found by the Court of Civil Appeals show a gross fraud by Bush Tillar in appropriating to their own benefit the transaction with Rule and Allen, when they had agreed to consummate it for the benefit of Pyron and the O'Neals. The Court of Civil Appeals affirmed the judgment of the District Court, which was in favor of the plaintiffs in error here, but upon motion for rehearing they set aside that judgment for a very peculiar reason.
The court seems to hold that Bush Tillar, who held the legal title to the land, could not by the consent and at the direction of Pyron and the O'Neals pass the equitable title to the purchasers in Kansas City. They did not cite any authority for that proposition, and we have not been able to find any that tends to support that position. It is unquestionably true that, as a matter of law, the vendor of land with a reservation of lien for the purchase money holds the legal title, and on failure of the vendee to pay, the vendor may revoke the sale and resume the equitable as well as the legal title. The writer has not been able to find authority to support the proposition that one who holds the legal title can not, by consent of the holder of the equitable, pass the equitable by the conveyance of the legal title. The legal title is paramount to the equitable title under such circumstances.
There can be no reasonable doubt about the proposition that, with the consent of the cestui qui trust the vendor, in this case, the trustee, might convey the whole right, legal and equitable, to the agreed purchaser, and the Court of Civil Appeals erred in setting the judgment aside.
We have no forms of action in this State, but every suit is conducted by petition and answer. Articles 1826 and 1827, Vernon's Sayles' Civil Statutes; Carter v. Wallace,
When the allegations of the petition are sufficient the court will render such judgment as will meet the requirements of the allegations *256 in the petition, without regard to the form of action. If the party is entitled to damages and alleges facts which entitle him to damages, the court will give him damages. If a party alleges facts which entitle him to remission, the court will give him rescission. If a party is entitled to an enforcement of a contract, the court will find in his favor to enforce it, without regard to the forms of action in the trial court, and will administer justice according to the allegations in the petition and briefs which are presented.
It is therefore ordered that the judgment of the Court of Civil Appeals upon rehearing by which it set aside its former judgment and rendered judgment in favor of the appellants in this case, be and the same is hereby set aside and held for naught. And it appearing that the first judgment of the Court of Civil Appeals was by that court set aside on a question of procedure, it is ordered that the judgment of the District Court be affirmed.
Opinion delivered February 24, 1915.
Addendum
We are not satisfied with the decision of this case as made on the original hearing. The motion of the defendants in error for a rehearing is granted and our original judgment set aside, the case being continued for determination at the next term.
It should be said that the inaccurate statement in his opinion as to the disposition made of the case by the Court of Civil Appeals was intended to he corrected by Judge Brown before it was filed, and this was not done only through oversight. While the statement was erroneous, it was not one of vital importance.
Opinion filed June 26, 1915.
Addendum
At a former term we reversed the judgment of the honorable Court of Civil Appeals in this case and affirmed that of the District Court, the opinion of the court being delivered by the late Chief Justice Brown. Some misstatements in respect to the disposition of the case by the Court of Civil Appeals appeared in the opinion which it was Chief Justice Brown's purpose to correct before the opinion was filed, but through oversight this was not done. For the purpose of making these corrections and re-examining some features of the case, as well, we granted the motion for rehearing of the defendants in error, setting our judgment aside and reserving further decision.
The case in all of its aspects has been thoroughly reconsidered. Save in one material respect it was in our view correctly decided upon the former hearing, and with that correction in the judgment our former determination will be adhered to. *257
A substantial statement of the case is contained in the former opinion. A judgment for $25,000 and interest in favor of the plaintiffs in the suit was rendered in the trial court. This judgment was reversed by the Court of Civil Appeals, upon a holding that the defendants were entitled to have the jury pass upon the issue as to the value of the notes, in excess of $6.50 per acre, given them by Rule and Allen for the land, and the cause remanded for further trial. On rehearing judgment for the defendants was rendered, apparently upon the ground that the plaintiffs' cause of action was one for damages for the defendants' breach of their contract to account to the plaintiff for the amount in excess of $6.50 per acre received in the sale to Rule and Allen, and not for the recovery of such excess, as was in fact the action.
There was evidence to sustain a finding, — and under the charge of the court it is to be assumed that such was the jury's finding, — that Tillar for himself and co-defendant, the owners of the land, agreed with the plaintiffs that in lieu of their making any further payment under their own contract and a closing of the pending transaction for their acquisition of the title, the land might be directly conveyed to Rule and Allen, with whom the plaintiffs, in contemplation of their own purchase, were negotiating for its sale; and that acting with the plaintiffs and in their behalf he would assist in concluding such sale, holding for the plaintiffs as their property, and accounting to them therefor, all in excess of $6.50 per acre that Rule and Allen might bind themselves to pay for the land. The sale to Rule and Allen, for $6.50 per acre and $15,000 in excess of that amount, evidenced by secured notes, was thus effected. It is clear that the sale was made through the means of the pending negotiation between the plaintiffs and Rule and Allen, of which Tillar fully availed himself. The result was a sale of his and his co-owner's land which was entirely satisfactory to himself. Tillar's attempted repudiation of his agreement with the plaintiffs after the sale to Rule and Allen was virtually concluded and his announcement of a purpose to appropriate the entire proceeds could not destroy the rights of the plaintiffs under the agreement. He undertook the transaction with Rule and Allen under the agreement, and in good conscience was bound to observe it upon concluding a sale which was the subject of it. The plaintiffs owned an equitable interest in the land. They had assisted in closing the transaction with Rule and Allen, and hence were in the attitude of consenting to the passing of their equitable interest by Bush Tillar's deed. The conveyance by Bush Tillar of the legal title, therefore, passed to Rule and Allen the plaintiffs' equitable interest by estoppel. In concluding the transaction with Rule and Allen under these circumstances, Tillar, upon clear equitable principles, was a trustee for the plaintiffs to the extent of the excess over $6.50 per acre that Rule and Allen contracted to pay for the land, and rested under the duty of accounting to the plaintiffs therefor. *258
The failure of the trial court to submit the issue as to the value of the notes accepted by Bush Tillar, representing the excess over $6.50 per acre agreed to be paid by Rule and Allen in the transaction, affords no ground for reversing the judgment. Granting that there was evidence raising the issue, the error of the court consisted in its omission from the charge. No special charge upon the issue was requested. The amount of the notes was, prima facie, their value; and upon the measure of the recovery there was no affirmative error in the charge. A judgment will not be reversed because of a mere failure to submit an issue where no charge embodying the issue is requested. Shumard v. Johnson,
This is also true of the issue in respect to the amount the plaintiffs were entitled to recover if the payment by Tillar of $15,000 in notes to Pyron, one of the plaintiffs, was for a commission earned in making the sale to Rule and Allen. Assuming that this payment to Pyron was for such purpose, and not, as Pyron claimed, for the purpose of satisfying other indebtedness due him by Bush Tillar, and that accordingly there could be no recovery for his interest in the amount Rule and Allen agreed to pay for the land in excess of $6.50 per acre, no special charge presenting the issue was requested by the defendants; and, therefore, the judgment will not be reversed because of the court's failure to submit it.
In one respect we think the judgment of the trial court was materially wrong. This is the only additional question which we deem it necessary to discuss. The undisputed evidence was that the amount agreed by Rule and Allen to be paid for the land in excess of $6.50 per acre was $15,000. The jury found in favor of the plaintiffs in the amount of $25,000 with interest, and judgment was so rendered. This included the $15,000 agreed to be paid by Rule and Allen in excess of $6.50 per acre and the $10,000 which the plaintiffs had previously paid the defendants under their contract of purchase. The charge of the court authorizing a recovery in favor of the plaintiffs was as follows:
"You are instructed that if you believe from the evidence that after plaintiffs and defendants entered into the written contract offered in evidence, dated October 27, 1906, and before or on May 11, 1907, plaintiffs had secured an agreement from Rule and Allen, for the purchase by said Rule and Allen from the plaintiffs of all the rights and interest vested in the plaintiffs under and by virtue of the said written contract between plaintiffs and defendants, for the sum of $25,000 and $6.50 per acre; and that thereafter and on or about the 11th day of May, 1907, the defendant Ben J. Tillar, for himself and for the firm of Bush Tillar, entered into an agreement with the plaintiffs, that they, the defendants, would, in lieu of any further payments which might then be due from plaintiffs under the contract of October 27, 1906, conclude and make for plaintiffs and themselves, the trade with said Rule and Allen, and make conveyances of or contracts for the *259 land described in said written contract of October 27, 1906, direct to said Rule and Allen and that defendants would preserve for the plaintiffs' benefit any advanced consideration or bonus which you believe from the evidence said Rule and Allen had agreed, at that time, to give plaintiffs over and above the $6.50 an acre and that the defendants Bush Tillar, and Ben J. Tillar would accept for themselves the $6.50 per acre and give to the plaintiffs, or account to the plaintiffs for all amounts over and above such sum of $6.50 per acre, as they might be able to contract for with said Rule and Allen; and you further believe from the evidence that in consideration of such agreement the plaintiffs notified Rule and Allen that they should deal directly with said Ben J. Tillar with reference to said matters, and they did so deal with said Tillar with reference to said contracts for the sale of said lands; and you further believe from the evidence that the defendants did, in pursuance of said agreements and understanding, if any, contract for the conveyance of said lands (mentioned and described in said contract of October 27, 1906) to said Sidney P. Allen with the guarantee of said Rule, and the same was acceptable to said defendants, and they, the defendants, did receive, realize or secure satisfactory contracts for any amount of money in excess of $6.50 per acre for said lands, then it will be your duty to find for the plaintiffs the amount which you find from the evidence said defendants realized, or secured satisfactory contracts for the payment of, in excess of $6.50 per acre, with interest at the rate of 6 per cent per annum from the date of the consummation of such sale to said Rule and Allen by the defendants."
This charge does not submit as an issue any agreement upon the part of defendants to pay the plaintiffs all that might be realized by them in the sale of the land in excess of $6.50 per acre, including the $10,000 which the plaintiffs had previously paid on their original purchase agreement, and does not authorize a recovery for the latter amount. It deals with the status of the parties as it existed after that payment had been made, and submits, as the predicate for a recovery by the plaintiffs, whether Tillar agreed, in lieu of any further payments by theplaintiffs under their contract, that he and Bush would, for the plaintiffs and themselves, conclude the pending trade between the plaintiffs and Rule and Allen, and would preserve for the plaintiffs any bonus agreed to be paid by Rule and Allen for the land in excess of $6.50 per acre, and account to them for all amounts over. $6.50 per acre which they might be able to contractfor with Rule and Allen. In other words, the subject of the charge was whether Tillar agreed that he and Bush would give to the plaintiffs all amounts over $6.50 per acre which Rule andAllen might agree to pay for the land; whether any amount in excess of $6.50 per acre was agreed to be paid by Rule and Allen; and the rule of liability in that event. It made no reference to any other character of agreement. A finding that Tillar did so agree would entitle the plaintiffs to a verdict for the amount in excess of $6.50 per acre that Rule and Allen agreed to pay, but it would not warrant a *260 verdict for an amount not a part of that amount. The charge then authorized the jury, if they found that Tillar agreed that he and Bush would account to the plaintiffs for all amounts over $6.50 per acre contracted to be paid for the land by Rule and Allen, and that the defendants did receive, realize or secure satisfactory contracts for such an amount, to find for the plaintiffs the amount "which the defendants realized, or procured satisfactory contracts for the payment of, in excess of $6.50 per acre, with interest." This plainly relates only to the amount in excess of $6.50 per acre realized in the transaction with Rule and Allen or for the payment of which they had obligated themselves. As previously stated, that amount was only $15,000. Under the charge, therefore, no recovery for a greater amount was authorized. In their printed argument filed in this court the plaintiffs have offered to file a remittitur of $10,000 if we should conclude that under the charge no greater amount than $15,000 with interest was recoverable. It being an undisputed fact that the amount agreed to be paid by Rule and Allen for the land in excess of $6.50 per acre was $15,000, we may reform the judgment and affirm it for the correct amount. The judgment of the Court of Civil Appeals is reversed, and the judgment of the District Court is accordingly reformed so as to allow a recovery by the plaintiffs in the amount of $15,000, with interest at the legal rate from May 11, 1907; and as thus reformed the judgment of the District Court is affirmed.
Reformed and affirmed.
Opinion delivered February 14, 1917.