Brown v. Byrne, 3074.

• Decision Date: 18 October 1934
• Docket Number: No. 3074.,3074.
• Citation: 75 S.W.2d 484
• Parties: BROWN v. BYRNE et al.
• Court: Texas Court of Appeals

75 S.W.2d 484

BROWN v. BYRNE et al.

No. 3074.

Court of Civil Appeals of Texas. El Paso.

October 18, 1934.

Rehearing Denied November 8, 1934.

Appeal from District Court, El Paso County; W. D. Howe, Judge.

Action by J. Wylie Brown against Charles L. Byrne and others. From an adverse judgment, plaintiff appeals.

Affirmed.

J. Walker Morrow, of El Paso, for appellant.

Brown & Brooke, of El Paso, for appellees.

WALTHALL, Justice.

This case is stated in the briefs of one of the parties substantially as follows:

J. Wylie Brown brought suit in the district court against Charles L. Byrne, Jas. Q. Byrne, E. F. Byrne, George Biefer, and Tri-State Tobacco & Candy Company, alleging that he is the owner of preferred stock in the last-named defendant, a corporation, in the sum of $13,000 par value, and that suit was brought on behalf of the corporation for the benefit of himself and all other stockholders, he and the other individual defendants being the only persons owning stock in the corporation; that the individual defendants were the only directors in the corporation and had complete control thereof. He alleged that upon inspection of the books of the corporation during August and September, 1933, he ascertained that the individual defendants abstracted from the funds of the corporation, without right or authority, the sum of $8,000, which they have applied to their own use and benefit, and that other sums in the amount of $4,000 have been by them taken from the assets of the corporation and applied to their own individual use and benefit, and that these abstractions were unauthorized and illegal and in violation of the rights of the plaintiff and all other stockholders. He prayed that he have judgment for the benefit of himself and all other stockholders in behalf of the corporation against the individual defendants in the sum of $12,000, with interest and costs.

The defendants answered by a general demurrer, general denial, and a plea of the two years' statute of limitations, and further that if any moneys were paid out by them, that said sums were paid out to the plaintiff himself more than two years prior to the filing of the plaintiff's petition, with his full knowledge and acquiescence, and that at the time said moneys were paid out, he knew of their source and knew that they were paid from corporate funds, and he was advised and knew of that fact, and with knowledge of that fact, he accepted said moneys and acquiesced in the payment thereof and waived any claim or right which he might have, and by virtue of the facts he is estopped to assert any claim against these defendants or either of them and cannot now be heard to assert same. That the transaction alleged by him involved a trade in connection with corporate stock in the Tri-State Tobacco & Candy Company, which he owned and which he was selling to some of the defendants, and the moneys described by him in his petition were paid out to him with his knowledge of the source from which said funds came, and he was fully advised with reference thereto in the premises; that at all times the books and papers of the corporation were accessible to him and open to his inspection, and he had free access thereto, and that he consented to said transaction and acquiesced therein and with knowledge of the facts failed to protest at the time of the transaction, and until long thereafter when the entire financial status and ability of the defendants and of the corporation itself had changed due to a long period of economic depression; that the plaintiff knowingly accepted the benefits of the payments, acquiesced therein, and waived any irregularity there may have been in connection therewith, and after said acquiescence and long delay cannot now be heard to complain; that he fails to come into court with clean hands, and, under the circumstances, is not entitled to the relief prayed for by him. The defendants followed these allegations with a prayer that plaintiff take nothing by his suit; that they go hence without day and have and recover of and from the plaintiff their costs, with general and equitable relief.

Upon trial the court overruled the defendants' demurrers, defendants excepting, and having heard the evidence, found that the plaintiff was not entitled to the relief sought and rendered judgment for the defendants. At the request of the plaintiff, the court filed findings of fact and conclusions of law, which we now copy in full in this opinion.

Findings of Fact.

1. On February 14, 1931, J. Wylie Brown, plaintiff, and James Q. Byrne and Charles L. Byrne, defendants, entered into a written contract of that date under which said defendants were to purchase $15,000 of preferred stock and $10,000 of the common stock owned by J. Wylie Brown, plaintiff, in the Tri-State Tobacco & Candy Company, in which he was then sole and only stockholder.

2. On March 10, 1931, pursuant to this contract, plaintiff, Brown, turned over to defendants a check drawn on the Tri-State Tobacco & Candy Company in the First National Bank of El Paso for $472.65, payable to the corporation, closing that account. He likewise delivered to them his personal check on the State National Bank for $8,714.04, payable to the corporation for the accounts receivable of the corporation, which were under the contract to be delivered to him, and this latter check was drawn on an account in the State National Bank which Brown, plaintiff, was opening on that day by a deposit of a check which he had at the same time received from the corporation in the sum of $10,000. Contemporaneously with the delivery of the two checks by Brown to the defendants, they gave him the above-mentioned corporate check for $10,000, in payment for the...