*1 WATSON, Appellant, Bobby Lee
v.
CARGILL, INC., NUTRENA Appellee.
DIVISION, 5901.
No. Texas, Appeals of Civil
Court
Waco.
Sept. 9, 1978.
Rehearing Nov. Denied *2 Bates, Waco,
John L. appellee. for HALL, Justice. Plaintiff-Appellee Inc., Cargill, Nutrena Division, Feed brought this suit for quan- tum $4,554.72, meruit to recover alleged to be the reasonable value of dairy cattle feed sold and by plaintiff delivered to defendant- appellant Bobby Lee Watson on “a running account” in regular course of business at defendant’s request. instance and Plain- tiff sued also for attorney’s reasonable fees $1,518.24. the amount of Defendant an- general denial, swered with a spe- cial pleas (1) that part of the account sued upon was barred the two-year statute of (2) limitation and that he was not indebted plaintiff on the last four sales upon sued because, by agreement of the parties, he paid had for each plaintiff but erroneously had credited those payments to oldest on his During account. trial, the course of the by way of trial amendment, pleaded defendant also that plaintiff had charged him usurious interest on the account subjecting plaintiff to the penalties set 5069-1.06, forth in Article for which prayed he recovery.
Trial was to the court without a jury. During the hearing the court determined that plea defendant’s of limitation was good, and refused to hear evidence prof- fered relating to portion the account which allegedly fell within the two-year period. per- fected exception its bill of on that proof. trial, After the the court sustained defend- plea ant’s payment on delivery of the last purchases four plaintiff, from but denied any recovery on his pleadings of usury. rulings Under those judgment was $1,192.41 plaintiff rendered for for account, plus attorney’s fees.
Express findings of fact and conclu sions of law were requested neither by the parties nor Therefore, filed the court. it presumed must be that all necessary fact findings were impliedly made the court McMullen, McMullen, Andy Connally, support J. of the judgment. Renfro Drug Robertson, Jordan, Campbell, Lewis, Holliman & Co. v. 149 Tex. 235 S.W.2d Inc., Hamilton, appellant. (1950). (2) holding could parties complain appeal. De- not
Both (1) the court erred in allow- payments fendant asserts cash credit defendant on ing recovery on plaintiff any to the unpaid last four deliveries oldest delivery there was no evidence of because invoices on the account. him; (2) or value of the feed sold allowing plaintiff attorney’s court erred in *3 Limitation when case was tried and fees because originally case filed This legal was no basis for determined there on in the 19th Judicial fees; and, (3) undisputed such under County, in District Court McLennan as a evidence, failing in to award court erred open under suit verified account penalties usury under the provisions Rule Vernon’s Tex.Rules statutes, an including award of reasonable Civ.Proc., $4,554.72.-The for the sum fol- attorney’s fees. Plaintiff contends lowing itemized statement of account was affirming (1) in defendant’s court erred original petition failing plaintiff’s to consider attached plea of limitation and accounts; proof open plaintiff’s support as the suit: 18, 1977, Copies February of the six invoices listed On after the case was docketed in the District Court Hamilton were also statement attached County, filed its first amended as exhibits. original pleadings petition, original which was also the na- 10, 1976, on defendant’s On ture of suit verified account. transferred plea privilege, case was However, statement of account at- County. to Hamilton petition tached to the was as amended fol-
lows: *4 plea. ruling attached to the amend- Plaintiff contends the er- Again, the invoices was petition only roneous, the last six listed on agree. ed and we statement, at- being the same invoices question by is controlled original pleadings. plaintiffs tached to 5539b, applicability of Articles 5526 and called for trial on When the case was Vernon’s Article 5526 Tex.Civ.St. sets 22, 1977, counsel con- plaintiff’s forth certain actions brought which must be by exception the merit of an ceded years. provides part within two It as validity of the affi- attacking the follows: peti- plaintiffs amended davit attached to prose- “There and shall be commenced tion; have a that “we do not now admitted years within cuted two after cause of account”; the court and stated to verified accrued, not after- action shall have me- quantum “a proceed he would ward, all actions or suits in court of the Rule . . . and not under ruit basis following description: on that basis. proceeded The case 185.” upon . “5. Actions two-year statute plea of the Defendant’s accounts, ... In . accounts Tex. limitation, Vernon’s Article of against run each item limitation shall Civ.St., transactions and made to all was the date of such unless from of account charges shown on statement specially otherwise contracted.” petition amended plaintiff’s attached to with limitation Article 5539b is concerned of on the statement which were not shown supplemental affecting as amended and petition. original to the account attached it said, pleading, sustained the reads as follows: we have the court As Ramirez, & v. any pleading any “Whenever is filed State Bank Trust Co. (1939); of party embracing any to a suit cause Tex. Leonard v. S.W.2d cross-action, counterclaim, action, or Inc., de- Texaco, (Tex.1967); S.W.2d fense, filing at the time of such Co., v. El Lumber Browning Paso 140 S.W. action, cross-ac- pleading such cause (Tex.Civ.App. writ). Paso no — El tion, counterclaim, or is not sub- defense none of the account Because was barred limitation, subsequent plea a no ject to limitation, proof plaintiff’s bill of supplement changing any or amendment exception relating to all the transactions liability grounds or or of facts properly before the court considera- subject plea be to a limi- defense shall tion. tation, provided sup- or such amendment wholly upon and plement is not based Designated Payment Credit new, or different grows out of distinct It is the settled rule that where Provided, transaction and occurrence. however, running there is a account with various any amendment or when such filed, occurring items and credits at any if new or differ- supplement is times, alleged, upon application pay facts are different and no direction of ent may debtor, opposite party, post- court ment pay has been made justice may as pone or continue case applied ments the account as a whole are require.” portion law the unpaid oldest of the Berry-Barnett Grocery account. Prowell v. argu We agree defendant’s *5 53, Company, (Tex.Civ.App. 462 S.W.2d 54 that item on the account ment each 1971, ref’d). writ The applies —Waco rule separate a the was transaction between part even if the oldest of the is account parties, plaintiff’s origi but we believe that by undesignated barred limitation when an account, petition whole nal embraced the payment is made the v. by Pyle debtor. petition simply that amended and the 507, Byrne, (Tex.Civ.App.— 331 S.W.2d of enlargement and the amplification an 1960, n. r. e.); Morgan Texarkana writ ref’d originally upon. of the account sued facts 347, (Tex.Civ. v. Morgan, S.W.2d sought the pleadings, plaintiff In both same 1966, $4,554.72. App. writ). Antonio no theOn balance due on the account of To — San hand, the parties agreed other if have that pleaded originally reach this balance as and payment a required application applied the of shall be to a certain by amendment indebtedness, by or if payments all defendant the the debtor has directed transactions, procedure such application, agreement oldest contested then the or di by plaintiff’s application defendant. It was et controlling. rection is Tex.Jur.2d 687 payments 33, the in fashion which seq., Payment, that §§ “partial brought forward the balance” of case record that in In our the shows on # as sued in invoice on $265.84 March, 1975, February or when defendant original gone If the case had petition. the account, plaintiff was in arrears on his re original plaintiff’s peti trial on to contested shipments fused make future feed to tion, required to plaintiff would have been unless, delivery, defendant at the time of exactly in its the account as itemized prove paid equal in cash a sum in to establish its pleading order amended charge to the for the feed an plus delivered the right alleged to recover balance “overage.” $250.00 additional Defendant $4,554.72. Accordingly, we hold that all the requirement met on the four last in the amendment transactions itemized transactions shown statement of necessarily upon originally; sued account, ante, (evi April May, provisions Article 5539b that under the # # by denced invoices prescribed by Arti two-year limitation the 76455) # # with exception the the improperly by trial applied cle 5526 was he the the payment not made at time of items of the account court those (invoice 59599) April # original pleading. delivery See First on 25th shown greater not include the additional than the which did amount by authorized overage. applied all those pay- Subtitle, shall forfeit to the obligor ments, including representing the amount twice the amount of interest contracted delivered, charge gener- for the feed as for, received, charged or and reasonable payments al to defendant’s account. attorney provided fees fixed the court the agreement trial court found that of the that there shall be penalty no for a viola- parties was that those deliveries were made tion which results from an accidental and basis, only overag- on a “cash sale” with bona fide error. applied delinquent to the account. es to be “(2) for, Any person who contracts finding supported by testimony That is charges or receives interest which inis defendant, agree- who stated that excess of double the amount of interest “They bring ment was this: would the feed allowed this Subtitle shall forfeit as an out, pay but I would cash the feed [for additional as penalty, principal as well plus fifty two hundred and dol- delivered] and all other and shall interest overage my lars account. If I wasn’t pay attorney reasonable fees set pay get I would not there to driver ” court; . . . would not deliver They feed delivered. The terms of all sales made Any feed on account. future deliveries re- basis, to defendant on the in question would be on a cash and would ceived is, be for in full when delivered—before were paid days, days.” “2% 10 net 30 That the truck unloaded.” Plaintiff’s Field Man- plaintiff would discount two of the ager arrangement who made the de- charge for each delivery payment with- payment fendant for cash on future deliver- days delivery; in ten charge and the testimony that ies denied defendant’s became delinquent paid if not within 30 agreement was for cash sales on days. An invoice prepared by plaintiff re- ques- testimony only but his raised a fact flecting those terms was delivered to de- was resolved the trial court tion which shipment. Additionally, fendant each as trier of the facts defendant’s favor. each invoice contained the lan- following *6 guage printed charges on its face: “Above the benefit of the court’s deter- Granted subject delinquency charge to a per- one mination that the last four transactions per past cent month on due balances.” At paid for on inasmuch as none month, plaintiff end each mailed of the account was barred defendant a statement the balance of account re- defendant still owed flecting when this suit the status of the account at principal on the account time. filed. began assessing delinquency Usury charges past charges due to the account usury statutes in focus in this case doing and continued so 5069-1.06, Ver-
are Articles 5069-1.03 through May, Additionally, begin- pro- Article 5069-1.03 non’s Tex.Civ.St. March, plaintiff ning assessed the delin- vides: quency charge unpaid delinquency rate of interest is specified “When no charges during added to the account interest at agreed upon by parties, month. All prior delinquency charges were be per annum shall the rate of six to the account as and were principal, added accounts, allowed on monthly shown as such on the statements day of after from the first sent to defendant. At the end of each are made.” same month mailed defendant an invoice provides penalties as fol- Article 5069-1.06 showing delinquency charges applied lows: during his account the month. The invoices for, following delinquency charges show the
“(1) Any person who contracts which is made: or receives interest /
41 (Terms Days”) 10 “Net 3-31-75 Invoice No. 00188 dated CHARGE “DELINQUENCY AMT. FOR CHARGE AMOUNT DATE
TRANSACTION .09 20 DAYS 14.53 2-28-75 INV. 00020 2.51 1 MO 251.63 INV. 68434 1-08-75 9.77 1 MO 977.17 1-13-75 INV. 68497 8.75 1 MO 875.77 INV. 1-17-75 68555 5.89 1 MO 589.40 INV. 1-20-75 68572 1 9.78 MO 978.67 1-24-75 INV. 68630 7.05 1 MO 705.51 1-27-75 INV. 68652 8.64 28 926.57 DAYS INV. 68719 1-31-75 52.48” TOTAL (Terms Days”) 10 “Net Invoice No. 00349 dated 4-30-75 CHARGE “DELINQUENCY FOR AMT. CHARGE DATE AMOUNT
TRANSACTION .14 1 14.53 MO INV. 00020 2-28-75 .33 19 52.48 DAYS INV. 00188 3-31-75 1 4.88 MO 488.34 INV. 1-17-75 5.89 589.40 MO 1-20-75 INV. 9.78 MO 978.67 INV. 1-24-75 7.05 705.51 MO INV. 1-27-75 *7 1 9.26 926.57 MO INV. 68719 1-31-75 37.33” TOTAL (Terms Days”) 10 No. dated 5-31-75 “Net Invoice 00459 CHARGE “DELINQUENCY AMT. CHARGE FOR DATE AMOUNT
TRANSACTION 1 .14 14.53 MO INV. 2-28-75 00020 1 .52 MO INV. 52.48 00188 3-31-75 .24 20 37.33 DAYS INV. 00349 4-30-75 1.40 5 DAYS INV. 843.05 59599 4-25-75 2.65 1 MO INV. 265.84 68652 1-27-75 1 9.26 926.57 MO 1-31-75 INV. 68719 9 1.56 DAYS 523.18 INV. 69846 4-21-75 15.77" TOTAL 42 per compounded, charges month on all to
The term “interest” is defined in days the which were 30 or account more compensation al Article 5069-1.01 as “the past due. Plaintiff’s Administrative Mana forbearance or lowed law for the use or ger admitted that was the method of calcu money”; “usury” detention is lation. This rate was in excess of double in that statute as “interest in ex defined percent per the amount of six annum al amount allowed law.” The cess of the lowed accounts under Article 5069- delinquency charges by plaintiff assessed 1.03; although none the interest was meaning were within the of the interest paid by defendant and none of it was ever 635, Lubbock, statute. Parks v. 92 Tex. charging it by plaintiff, the sued for 322, (1899); Windhorst v. Adcock S.W. set forth in Article triggered penalties the Pipe Supply, (Tex.Sup. And S.W.2d 5069-1.06, supra. Windhorst v. Adcock 1977). 260, (Tex. Pipe Supply, And S.W.2d agree testified that he did not Defendant Sup.1977). account, and there is pay to interest on charges Excluding agree no evidence that he did to do so. shipments by paid upon receipt the statement As shown on defendant, the evidence still shows that the account, plaintiff defendant’s account with $4,554.72 sued for principal balance of November, began in 1974. Under Article up charges against plaintiff is 5069-1.03, supra, plaintiff would have been charged interest in excess of plaintiff which interest at the rate of charge entitled to six per Accordingly, twelve annum. 1, percent per beginning January annum 5069-1.06, provisions of Article under $3,679.13, 1975, on the sum which was then principal amount plaintiff must forfeit That sum was delinquent on the account. account, charged interest plus its by in the total of transactions evidenced $120.11, and defend the account in the sum 68163, 68218, 68263, # # voices # to recover twice the amount ant is entitled 68316, # # less credit memo plus reasonable attor charged of interest 1975, Therefore, during January, usury his claim. ney’s prosecuting fees for on the delin charged could have interest And Builders Lafferty Developers v. A.E.M. $25.51, al quent account the amount Co., (Tex.Civ.App.—San 483 S.W.2d 29th, it not do so. On though did e.). Antonio writ ref’d n. r. 68218, totaling # transactions # 68163 and points The and contentions of remaining $2,256.94, is evi paid by defendant as parties are overruled. in that payment credit denced holdings plaintiff Under our is not enti- statement. There amount shown on the suit, recovery by tled any and de- fore, February, plaintiff could during plus fendant is entitled to recover $240.22 in the charged interest on the account have an attorney’s amount for reasonable fees. delinquent sum amount the trial court Because denied defendant’s However, $3,000.00 $1,422.19. after claim, usury finding it did not make a his Febru to the account on payment credited attorney’s although fees he ten- favor on against 27th, delinquency ary there was no question. proof dered charged by could have been which interest reversed, judgment is and the case is the interest Accordingly, plaintiff. permit remanded to the court to determine in 1975 on bal actually made the amount to be awarded to defendant for *8 prematurely in 1975 were accruing ances fees, attorney’s his and to then judg- render made, in of violation Article 5069 1.03. ment in accordance rulings. with our were usurious. They Reversed and remanded. set forth Additionally, the invoices Justice, dissenting. JAMES, actually as above show that the interest agree with the respectfully dissent. I I on defendant’s account sessed opinion that the majority my that it is in percent at the rate of one was calculated through this date Decem- 1976. From two-year ap- of does not statute 1976, However, 31, percent at six disagree majority I with the interest ply. ber majority usury question. hold- amounts to $273.28. the ing is in effect this: That since Plain- 1, 1977, the Defendant’s (3)On January delinquency charges against tiff assessed was still $4554.72. balance principal through Defendant from this never fell below His balance May percent the rate per 1975 at of one 1, January thereafter. From amount (after 30 compounded monthly days) month 22,1977 (date 1977, the to November of $120.11, charge for a interest of total judgment), interest at six trial court’s the the entire debt was tainted double to amounts per $265.65. annum lawby amount interest allowed under short, legally In Plaintiff was entitled the 5069-1.06(2), provisions of the Article call- under Article to the Defendant plus charge ing principal of all rea- forfeiture in T interest the total amount attorney’s 5069-1.03 respectfully sonable fees. sub- disposition proper mit that is not $759.67. such of this under the facts case. the Plaintiff sued for no inter- Although 5069-1.03, Under Article Plaintiff was est, charge the Defendant with he did charge entitled this account at the rate Where the Plaintiff is en- interest. $120.11 percent per day of six annum from the first charge in the titled to interest amount January after the deliveries of merchan- interest, $759.67, only I but $120.11 dise were made. This has been held to say cannot how we that the Defend- see can chargeable mean that such interest from is charged usurious interest. In- ant has been year the first of after an account is deed, has been actually the Defendant made, regardless of the date on which it charged less than he is lia- interest $639.56 Browning became v. El Paso Lumber due. Article ble for under 5069-1.03. (CCA writ; 1911) 386, Co. 140 S.W. no Erb- opinion, In consider the my we should Springall Pittsburg Co. v. Plate Glass Co. whole, particularly since account as a Plain- writ; (CCA 1907) 1165, 101 S.W. no 1 Tex. meruit, quantum tiff’s suit is founded on Jur.2d, 90, Accounting,” par. “Accounts and and determine first much interest the how Service, p. 340. see Also Tri-State Tire Inc. charge, Plaintiff was entitled and see (5th 1964) v. Gates Rubber Co. Cir. 339 F.2d charged proper than the whether he more 573. Here, charge, charged the Plaintiff or less. Let compute us amount of interest lawfully he less than was entitled to $639.56 right which had the charge Therefore, charge. my opinion, usury is on this under Defendant Article not the case. beginning its down to No- 5069-1.03 from judgment court's I reform the trial would 22,1977, vember the trial court’s date of by allowing recovery the Plaintiff a net
judgment: allowed instead $4554.72 $1192.41 1, (1) January On the Defendant’s court, respects trial in all other I $3679.13, principal balance was and his would judgment. affirm trial court’s principal balance never fell below this during year we amount As statute,
understand above from 1, 1975,
January through December legally Plaintiff was entitled to
charge per interest at 6% annum for year $226.74.
(2) 1, 1976, On the Defendant’s his
principal balance was fell
balance never below amount