Bonner Oil Co. v. Gaines

• Citation: 191 S.W. 552
• Decision Date: 07 February 1917
• Docket Number: (No. 2793.)
• Parties: BONNER OIL CO. v. GAINES et al.<SMALL><SUP>*</SUP></SMALL>
• Court: Supreme Court of Texas

191 S.W. 552

BONNER OIL CO. v. GAINES et al.^*

(No. 2793.)

Supreme Court of Texas.

February 7, 1917.

Certified Question from Court of Civil Appeals of First Supreme Judicial District.

Action by the Bonner Oil Company against John W. Gaines and the Lake Austin Canal Company. There was judgment for defendant Gaines in the trial court, which was reversed by the Court of Civil Appeals (179 S. W. 686), which certified the case to the Supreme Court. Affirmed.

Hunt, Myer & Teagle, Rodman S. Cosby, and Campbell, Myer, Myer & Freeman, all of Houston, for plaintiff. Gaines & Corbett, of Bay City, and Cole & Cole, of Houston, for defendant.

PHILLIPS, C. J.

The statement of the case as contained in the certificate of the honorable Court of Civil Appeals may be thus summarized:

The suit in the trial court was upon two notes given in favor of the Bonner Oil Company by the Lake Austin Canal Company and John W. Gaines, each for the sum of $445.20, and maturing, respectively, sixty and ninety days after date. The defense of Mr. Gaines was that the notes were, as to him, without consideration. It was pleaded by the plaintiff in reply that his execution of the notes was for the purpose of an extension of time being granted for the payment of the debt of the Canal Company which the notes expressed, affording a sufficient consideration for Gaines's liability. To this Mr. Gaines answered that there was no agreement for any such extension at the time of his execution of the notes; that he was not requested by the plaintiff to sign them; and that the purpose of their execution was to settle all controversy as to the amount of the debt due the plaintiff by the Canal Company. Mr. Gaines was president of the Canal Company and a principal stockholder. Prior to the execution of the notes the Canal Company had incurred an indebtedness in the amount of the notes in favor of the Oil Company for oil purchased on open account. This account was due and unpaid when the notes were executed. The Oil Company was endeavoring to collect it, and sent an agent, Bland, to the office of the Canal Company for that purpose, or, if that could not be done, to close the account by notes. Bland called upon Mr. Gaines in this connection, stating his purpose. Mr. Gaines replied that the corporation had not sold its rice and had experienced "bad luck." Thereupon Bland presented the notes for signature. They were signed by Mr. Gaines in the name of the Canal Company, by himself as president, and by himself individually, and returned to Bland, Mr. Gaines explaining at the time, in effect, according to Bland's testimony, "that he was doing this for Bland and not for the company," and saying, "I don't often do this," or, "This is something I haven't often done." Bland did not request Mr. Gaines to sign the notes individually, nor did he tell him that they would not be accepted without his individual signature; but he testified that he would not have accepted simply the notes of the corporation alone.

Mr. Gaines, in testifying to the circumstances under which he signed the notes, stated, in substance, that in presenting the notes Bland said the Oil Company needed them to use as collateral at its bank, and might do so; and this was the only reason assigned by Bland for wanting the account settled by notes. It appears that he also testified:

"I have...