Braselton-Watson Builders, Inc. v. Burgess, BRASELTON-WATSON

• Decision Date: 27 April 1978
• Docket Number: No. 1283,BRASELTON-WATSON,1283
• Parties: BUILDERS, INC., Appellant, v. C. B. BURGESS d/b/a Burgess Construction Company, Appellee.
• Court: Texas Court of Appeals

Page 24

567 S.W.2d 24

BRASELTON-WATSON BUILDERS, INC., Appellant, v. C. B. BURGESS d/b/a Burgess Construction Company, Appellee.

No. 1283.

Court of Civil Appeals of Texas,Corpus Christi.

April 27, 1978.

Rehearing Denied June 8, 1978.

James R. Harris, Corpus Christi, for appellant.

David T. Burkett, Corpus Christi, for appellee.

OPINION

NYE, Chief Justice.

This is a suit brought by plaintiff to recover a $700.00 balance due on an oral sub-contract for work done for defendant builder in connection with the construction of a home located on Xanadu Street in Corpus Christi, Texas. The defendant builder, Braselton-Watson Builders, Inc., filed a cross action requesting judgment for the same amount which had been withheld by defendant because of allegedly deficient work performed by the plaintiff at another home site located on Cherry Hills Street in Corpus Christi. The case was tried to a jury, and at the close of the evidence, the trial court directed a verdict for plaintiff for $700.00 due plaintiff on the Xanadu project and then submitted defendant's cross action to the jury. Based on the jury's answers to special issues, the trial court denied all relief to the defendant builder on its cross action. Defendant has perfected its appeal to this Court.

Defendant Braselton-Watson Builders, Inc., is a corporation which engages in the home building business in Corpus Christi, Texas. Plaintiff C. B. Burgess, d/b/a Burgess Construction Company engaged in foundation and concrete slab work for various home builders in the Corpus Christi area. The dispute between the parties concerns two oral contracts whereby plaintiff completed foundation and slab work at two of defendant builder's project sites, one located on Xanadu and the other on Cherry Hills in Corpus Christi. The foundation and slab work for the Cherry Hills project was completed and paid for first, and thereafter plaintiff completed the work at the Xanadu location. Plaintiff then submitted an invoice to defendant for $2,890.00 which represented the agreed price for the Xanadu location. By a check dated March 5, 1975, defendant builder paid plaintiff $2,190.00 for the Xanadu project, $700.00 less than the amount of the invoice. A notation on the lower left hand corner of the check indicated that $700.00 was being withheld pending "completion of repairs (at) 4934 Cherry Hills".

Plaintiff then instituted suit on the $700.00 deficiency against "Fred Braselton and R. L. Watson, d/b/a Braselton Watson Builders." The petition recited that service of process could be had on Mr. R. L. Watson at 4249 Mulligan, Corpus Christi, Texas. Braselton and Watson filed a general denial in their individual capacities. Two years after plaintiff's cause of action accrued, defendants Braselton and Watson filed an amended answer alleging that they had never carried on a business as Fred Braselton and R. L. Watson d/b/a Braselton Watson Builders. Defendants specifically denied under oath that they were partners as alleged in plaintiff's petition. In addition, defendants alleged that the plaintiff's suit was based on an agreement between plaintiff and the corporation "Braselton-Watson Builders, Inc."

Plaintiff then filed an amended petition naming as defendant "Braselton-Watson Builders, Inc." Defendant Braselton-Watson Builders, Inc., filed an answer alleging that plaintiff's suit was barred by the two-year statute of limitations. Defendant corporation also filed a cross action against plaintiff alleging that the work plaintiff performed for defendant on the Cherry Hills project was deficient and failed to conform to the agreement between the parties; that such deficiencies damaged defendants in the amount of $750.00; and that defendants had exercised its lawful right of offset by deducting $700.00 in its payment to plaintiff for the Xanadu project.

At the close of the evidence, the trial court denied defendant's motion for an instructed verdict based on its limitation defense and granted plaintiff's motion for an instructed verdict for $700.00 representing the outstanding balance owed to plaintiff for slab work on the Xanadu project. The trial court submitted special issues to the jury concerning defendant's cross action to establish the validity of the offset it had previously taken. In response to special issues, the jury, in relevant part, found: 1) that the plaintiff failed to complete the Cherry Hills project in accordance with the plans and specifications; 2) that such failure was not a producing cause of any damages or injury to the defendant; and 3) that $700.00 would be the reasonable cost to correct the deficient work at the Cherry Hills project. Based on the jury's findings, the trial court granted plaintiff's motion for judgment on the verdict, and denied defendant's motion to disregard special issue number two above and to render judgment in favor of defendant on its cross action. Defendant builder brings forward three points of error.

In point of error one, defendant builder contends that the two-year statute of limitations applicable to plaintiff's claim had run prior to the time plaintiff filed its amended petition naming, for the first time, "Braselton-Watson, Inc." as a party defendant. Plaintiff maintains on the other hand, that its original petition which was filed within the statutory time period against "Fred Braselton and R. L. Watson, d/b/a Braselton Watson Builders," merely misnamed the defendant it intended to sue and therefore, its original petition tolled the statute of limitations as to "Braselton-Watson, Inc." Defendant builder argues that plaintiff's original petition was nothing more than a suit against a partnership while its amended petition stated a cause of action against a corporation which, in effect, is a suit against a new and different party. Therefore, the "misnomer" cases are inapplicable to this situation. We disagree.

If plaintiff sued the right party but merely misnamed the corporation, then service upon R. L. Watson, one of its officers and principal shareholders, was proper and the corporation was then under a duty to plead such "misnomer" and seek abatement. Its failure to file a plea in abatement would constitute a waiver of the corporation's right to abate the lawsuit and the subsequent amendment of plaintiff's pleadings correctly stating the corporation's name would relate back to the date of plaintiff's original petition. Adams v. Consolidated Underwriters, 133 Tex. 26, 124 S.W.2d 840 (1939); Abilene Independent Telephone & Telegraph Co. v. Williams, 111 Tex. 102, 229 S.W. 847 (1921); Astro Sign Company v. Sullivan, 518 S.W.2d 420 (Tex.Civ.App. Corpus Christi 1974, writ ref'd n. r. e.); Thomas v. Cactus Drilling Corporation of Texas, 405 S.W.2d 214 (Tex.Civ.App. Austin 1966, no writ); Craig v. White Plaza Hotel, 289 S.W.2d 625 (Tex.Civ.App. Waco 1956, writ ref'd n. r. e.).

We must point out and distinguish the cases where a plaintiff has sued and obtained service upon the wrong party. In those situations, the plaintiff has made a mistake in the identity of defendant and the statute of limitations continues to run until the plaintiff files an amended petition to join the proper party in a new lawsuit. In such an instance, the defendant is not under any duty to notify the plaintiff of his mistake. Davis v. Outdoor Equipment Co., 551 S.W.2d 72 (Tex.Civ.App. Houston (1st Dist.) 1977, no writ); Astro Sign Company v. Sullivan, supra; Gillette Motor Transport Co. v. Whitfield, 160 S.W.2d 290 (Tex.Civ.App. Fort Worth 1942, no writ); Cosand v. Grey Wolfe Co., 262 S.W.2d 547 (Tex.Civ.App. Galveston 1953, no writ); West v. Johnson, 129 S.W.2d 811 (Tex.Civ.App. Fort Worth 1939, writ ref'd).

In the case before us it is undisputed that R. L. Watson was properly served with citation had plaintiff correctly named the defendant corporation in its original petition. Plaintiff construction company intended to sue the business entity with which it had its sub-contract. However plaintiff sued Braselton-Watson, Inc., as though it were a partnership and not a corporation. Defendant builder relies on Davis v. Outdoor Equipment Co., supra to support its contention that "a partnership is a different party from a corporation and suing one is not suing the other." In Davis, however, two separate business entities existed. One, a partnership, and the other a corporation, which shared the common name "Outdoor Equipment Company." In Davis, the plaintiff incorrectly sued and served the corporation. In our case only one business entity exists and it was admitted to be Braselton-Watson Builders, Inc. In their amended answer Braselton and Watson pled under oath that they were not partners and had never conducted business under the name "Fred Braselton and R. L. Watson d/b/a Braselton Watson Builders." Plaintiff sued the correct business entity only under the wrong name. See West v. Johnson, supra, at 815.

The primary purpose of a statute of limitations is to compel the plaintiff to institute a cause of action within a reasonable time so that the opposite party has a fair opportunity to defend while witnesses are available and while the evidence is fresh in their minds. Continental Southern Lines v. Hillard, 528 S.W.2d 828, 831 (Tex.Sup.1975). One justification for tolling the statute of limitations in misnomer cases, is that in spite of incorrect name, the party intended to be sued has been served and has been put on notice that he, and not some other person, is the intended defendant. Plaintiff's petition and attached invoice clearly apprised defendant builder that it was the intended defendant and that the subject matter of this suit...