383 S.W.2d 72 | Tex. App. | 1964
Tommy Burns Painting and Decorating Company, Inc., sued Roland Reinhardt and recovered judgment on a note for $6,168.17, plus interest and attorney’s fees. Reinhardt’s defense was that plaintiff had released the debt. Plaintiff then countered this defense by a plea, sustained by the trial court, that there was a total failure of consideration for the release.
Reinhardt was building houses during 1961 and ran into s.erious financial difficulties. He had previously given plaintiff the note, secured by a second lien on some
The consideration for a composition of creditors is the mutual covenant of each creditor to accept the settlement. Texarkana National Bank v. Hubbard, Tex. Civ.App., 114 S.W.2d 389; Creditors Rights in Texas, p. 137. Where there is no composition, there is no consideration, and the composition relied upon in this case to supply the consideration never came into being. Defendant, Roland Reinhardt, who relies upon the composition and the release executed by plaintiff, did not fulfill the first essential, his own duty to convey the assets by deed to the trustee, as the proposal required him to do. Flynn Investment Company, the creditor who held complete power over the success or failure of the composition, never agreed to it. In-other words, there never was a composition. Because it failed, there was np consideration for plaintiff’s release. See, Fitts v. Panhandle & S. F. R. Co., Com.App., 222 S.W. 158; 50 Tex.Jur.2d, Release, § 13.
The judgment is affirmed.