City and County of Dallas Levee Imp. Dist. v. Halsey, 5789.

• Decision Date: 26 May 1947
• Docket Number: No. 5789.,5789.
• Parties: CITY AND COUNTY OF DALLAS LEVEE IMPROVEMENT DIST. v. HALSEY, STUART & CO., Inc.
• Court: Texas Court of Appeals

202 S.W.2d 957

CITY AND COUNTY OF DALLAS LEVEE IMPROVEMENT DIST. v. HALSEY, STUART & CO., Inc.

No. 5789.

Court of Civil Appeals of Texas. Amarillo.

May 26, 1947.

Appeal from District Court, Dallas County; W. L. Thornton, Judge.

Action by Halsey, Stuart & Company, Incorporated, against the City and County of Dallas Levee Improvement District to recover fee for plaintiff's services as defendant's agent in exchanging defendant's bonds for refunding bonds and compensation for other services as defendant's fiscal agent. Judgment for plaintiff, and defendant appeals.

Affirmed.

Bowyer, Gray, Thomas, Crozier & Jaffee, of Dallas, for appellant.

Robert Ogden, of Dallas, for appellee.

PITTS, Chief Justice.

Appellee, Halsey, Stuart and Company, a corporation, filed suit against appellant, City and County of Dallas Levee Improvement District, a municipal corporation, and its Board of Supervisors, namely, Charles Roberts, J. Hardy Neel, and R. C. Griffith, in their official capacities only, alleging a debt created under and by virtue of a refund agreement, bond holders' agreement, plan and agreement of re-adjustment and approval thereof, and a letter of date July 22, 1937. Upon all of these agreements and the provisions thereof but particularly the provisions in the letter, appellee in effect declared appellant indebted to it in the total sum of $16,816.13 for which sum suit was filed. Appellant defended in effect on the grounds that no legal contract was authorized at any time by appellant's governing body and therefore appellant never at any time entered into a legal contract to pay appellee any sum; but, if appellant did obligate itself to pay appellee the sum claimed, the same was barred by both the two and four years Statutes of Limitations.

The case was tried to the court without a jury and judgment was rendered for appellee in the sum of $14,776.65 with annual interest thereon at the rate of six per cent per annum from August 29, 1945, from which judgment an appeal was perfected to the Court of Civil Appeals of the Fifth Supreme Judicial District and the same was transferred to this Court by the Supreme Court.

Appellant's first contention, made as a defense to the effect that no valid obligation existed against appellant because its governing body never at any time authorized the execution of a contract of any nature such as bound it to pay any sum to appellee for services rendered, was resisted by appellee on the grounds that appellant failed to verify its answer of "non est factum" denying the alleged obligation and that the authority of the Chairman of the Board of Supervisors of the City and County of Dallas Levee Improvement District is therefore conclusively presumed against appellant in the absence of such verified pleadings or denial and that appellant is bound by the statements, promises, and commitments made by such chairman of the Improvement District. The record reveals that the letter in question of date July 22, 1937, was addressed to appellee and signed by "L. A. Stemmons, Chairman, Board of Supervisors of City and County of Dallas Levee Improvement District," in which letter Stemmons agreed to pay appellee for its services as appellant's exchange agent a fee at the rate of 1/4 of 1% per $1000 bond so exchanged in exchanging 6000 bonds of the denomination of $1000 each owned and belonging to appellant for refunding bonds and in addition thereto the writer of the letter further agreed to pay appellee as appellant's fiscal agent for further services set out therein according to a lengthy schedule therein stated including "out of pocket expenses incurred by Halsey, Stuart and Company, Incorporated, in the performance of services both as exchange agent and fiscal agent; such expenses to cover telephone and telegraph, insurance and postage." The record further reveals that appellee pleaded the terms of the agreements hereinabove referred to and particularly the terms of the letter in question, a copy of which was attached thereto and made a part thereof for all purposes and that it pleaded a performance of the services until such were terminated by appellant for which it pleaded that appellant owes it a balance of $14,370 as exchange fees together with $2446.13 as a reimbursement for "out of pocket expenses." Appellant answered with a general denial and set up its defenses, among them being the defense above referred to but it did not swear to its pleadings. Rule 93 of the Texas Rules of Civil Procedure requires a lack of authority to execute an instrument sued on pleaded and claimed as a defense to be verified by the pleader and Section h of the said Rule provides that in the absence of such a sworn plea, the instrument in question shall be received in evidence as fully proved. Rule 93 supersedes and is a repetition of the provisions of the law found in several articles of the Statutes and we refer particularly to Article 2010 which required such a defense as herein discussed to be verified by the pleader. Such Rule has the support of many decisions and several text writers. Missouri State Life Ins. Co. v. Boles, Tex.Civ.App., 288 S.W. 271; Miles Realty Co. v. Dodson, Tex.Civ. App., 8 S.W.2d 516; Century Ins. Co. v. Hogan, Tex.Civ.App., 135 S.W.2d 224; 10 Tex.Jur. 996, Sec. 336. In the case of Willacy County Water Control & Improvement Dist. No. 1 v. Nelson, Tex.Civ.App., 108 S.W.2d 271, the said Rule was made applicable to a district such as appellant. Since appellant did not verify its pleadings the claim of lack of authority of L. A. Stemmons, Chairman of the Board, to bind appellant cannot be made the basis of an assignment of error by appellant.

But, be that as it may, the statement of facts contains some forty pages of orders and resolutions copied from the minutes of the proceedings of meetings held by appellant's Board of Supervisors in which authority was given for the payment of principal and interest due appellant on bonds to appellee; further excerpts from the said minutes reveal that the Board required that any notice of redemption of any bonds must be given to appellee by registered mail; we find other excerpts of a similar nature taken from the minutes of the said Board which clearly reveal that appellee's authority was well recognized by appellant and its Board of Supervisors in conducting the official business of appellant. The letter in question was recorded in the minutes of the Board by I. G. Etheridge, the secretary of the Board, who testified that Stemmons, Chairman of the Board, asked him to record the letter in the minutes as a...