Corpus Christi Bank & Trust v. Cross, 1390

• Decision Date: 30 August 1979
• Docket Number: No. 1390,1390
• Citation: 586 S.W.2d 664
• Parties: CORPUS CHRISTI BANK & TRUST et al., Appellants, v. William R. CROSS, David R. Baker and Lawrence Kieschnick d/b/a Cross, Baker& Kieschnick, Appellee.
• Court: Texas Court of Appeals

Page 664

586 S.W.2d 664

CORPUS CHRISTI BANK & TRUST et al., Appellants, v.William R. CROSS, David R. Baker and Lawrence Kieschnick d/b/a Cross, Baker& Kieschnick, Appellee.

No. 1390.

Court of Civil Appeals of Texas, Corpus Christi.

Aug. 30, 1979.

Rehearing Denied Sept. 21, 1979.

Charles R. Cunningham, Corpus Christi, for appellants.

Scott T. Cook, Larry G. Hyden, Harris, Cook, Browning & Barker, Inc., Corpus Christi, for appellee.

OPINION

BISSETT, Justice.

This is an appeal from a judgment awarding plaintiff damages and attorney's fees in its suit for accountant's fees against the defendant bank in its individual capacity for services furnished the estate of a decedent while the defendant was temporary administrator of the estate.We affirm.

The present controversy arose out of the performance by William R. Cross, David R. Baker and Lawrence Kieschnick d/b/a Cross, Baker & Kieschnick (hereinafter referred to as "plaintiff") of certain accounting services for Corpus Christi Bank & Trust (hereinafter referred to as the "Bank"), the temporary administrator of the Estate of Mrs. Rose Van Cura Kosar(hereinafter referred to as the "Estate").As a result of these services, a suit for accountant's fees was brought by plaintiff against the Bank in its individual corporate capacity.Trial was to a jury.Judgment was rendered in favor of plaintiff against the Bank in its individual corporate capacity.The Bank and Darlene Van Cura have appealed.¹

A threshold issue of a procedural nature has been raised by the Bank's seventh point of error.By this point, it is alleged that the trial court committed reversible error in three particulars: 1) in nonsuiting Darlene Van Cura(hereinafter referred to as "Van Cura") as a co-defendant in the plaintiff's suit for accountant's fees; 2) in ordering a separate trial of Van Cura's counterclaim for malpractice; and, 3) in ordering a severance of Van Cura's counterclaim for malpractice.In disposing of this point, we deem it necessary to briefly review the complex procedural history of this case.

The Bank and Van Cura were originally joined as co-defendants in the plaintiff's suit for accountant's fees.The Bank answered plaintiff's petition with a general denial and further brought a cross action for indemnity against Van Cura.The latter answered plaintiff's petition with genral and special denials, and filed a counterclaim for malpractice.Van Cura was then nonsuited by plaintiff, and the trial court ordered that her counterclaim be tried separately from the main action.The record does not reveal that any objections were raised by either of the defendants at that time.

Later, the Bank and Van Cura entered into an agreed partial summary judgment disposing of the Bank's cross action for indemnity against Van Cura.This agreed judgment ordered Van Cura, in her capacity as executrix of the Estate, to indemnify the Bank against any recovery which might be had by plaintiff in its main suit for accountant's fees.At this point, there was a certain merging of interests between the Bank and Van Cura, and the attorney for Van Cura was designated as additional counsel for the Bank.Trial of the main action was conducted before a jury which returned a verdict favorable to plaintiff.After return of the verdict, but before rendition of judgment, plaintiff moved to sever Van Cura's counterclaim.This was done, but not until after judgment had been rendered for plaintiff against the Bank and for the Bank against Van Cura.Hence, the posture of this case, as it stood when the judgment of the trial court was appealed, was that Van Cura had been removed from the law suit except insofar as the final judgment reflected the prior agreement of the parties evidenced by the partial summary judgment of indemnity.

We can find no reversible error alleged in the Bank's seventh point of error.The right to take a nonsuit when affirmative relief is not sought by defendant is absolute and cannot be denied by the trial court.State v. Gary,359 S.W.2d 456(Tex.Sup.1962);Renfroe v. Johnson, 142 Tex. 251, 177 S.W.2d 600(1944);Brooks v. O'Connor, 120 Tex. 121, 39 S.W.2d 22(1931);Ex Parte Helle, 477 S.W.2d 379(Tex.Civ.App. Corpus Christi 1972, no writ).Where defendant has filed a counterclaim seeking affirmative relief, however, plaintiff shall not be permitted, by a discontinuance of its suit, to prejudice the right of defendant to be heard on such counterclaim.Spence v. State National Bank of El Paso, 294 S.W. 618(Tex.Civ.App. El Paso1927) Aff'd, 5 S.W.2d 754(Tex.Com.App.1928);Valdez v. Gill, 537 S.W.2d 477(Tex.Civ.App. San Antonio1976, writ ref'd n. r. e.).Thus, Van Cura was not prejudiced by the trial court's action in nonsuiting plaintiff's claim against her for accountant's fees.Her claim for malpractice was alive and well at that moment.Coining the Bank's phraseology, Van Cura was not judicially stripped of her right to pursue her counterclaim against plaintiff by virtue of the nonsuit.

Prior to Van Cura's nonsuit, her counterclaim for malpractice was compulsory under Rule 97(a), T.R.C.P.SeeIn Re McCoy, 373 F.Supp. 180(W.D.Tex.1974).The nonsuit had the effect of transforming the malpractice claim from a compulsory counterclaim into a separate action for damages.This is because Rule 97(a) does not contemplate a situation where the counter-plainfiff is no longer a party to the main action.SeeValdez v. Gill, supra;Astro Sign Company v. Sullivan, 518 S.W.2d 420, 427(Tex.Civ.App. Corpus Christi1974, writ ref'd n. r. e.);Robertson v. Estate of Melton, 306 S.W.2d 811, 813(Tex.Civ.App. Beaumont1957, writ ref'd);Heights Funeral Home v. McClain, 288 S.W. 839, 843(Tex.Civ.App. Beaumont 1956, no writ).

When the trial court ordered that Van Cura's malpractice claim be tried separately from the plaintiff's action for accountant's fees, Van Cura had the burden at that time to raise any error allegedly resulting from piecemeal litigation.SeeLewis v. Texas Employers' Insurance Association, 151 Tex. 95, 246 S.W.2d 599(Tex.Sup.1952).The record does not indicate that any such objection was raised by anyone at that time.Therefore we will not review the trial court's action in ordering separate trials.

Regarding the trial court's order severing Van Cura's claim for malpractice from the plaintiff's claim for accountant's fees (SeeRule 41, T.R.C.P.), the record indicates that such decision was made by the trial court on March 9, 1978, the date the final judgment was signed.Acknowledging the general rule that severance of compulsory counterclaims usually will constitute an abuse of discretion, Bohart v. First National Bank in Dallas, 536 S.W.2d 234(Tex.Civ.App. Eastland1976, writ ref'd n. r. e.);Ball v. Cooper-Stanley Company, Inc., 413 S.W.2d 467(Tex.Civ.App. Dallas 1967, no writ);Ulmer v. Mackey, 242 S.W.2d 679(Tex.Civ.App. Fort Worth1951, writ ref'd n. r. e.), it has already been noted that Van Cura's claim ceased to be a compulsory counterclaim after the plaintiff's nonsuit as to her.While severance of claims which are not compulsory counterclaims can also, in some circumstances, constitute an abuse of discretion, Cruz v. Guajardo, 502 S.W.2d 610(Tex.Civ.App. Corpus Christi 1973, no writ), we find that Van Cura has not been prejudiced.Moreover, any waste of judicial economy or prejudice to Van Cura caused by piecemeal litigation was already an accomplished fact when the court finally ordered a severance of the claims.No abuse of discretion has been shown.

Finding no reversible error concerning the nonsuit of Van Cura or the severance of her malpractice claim, we are thus faced with a simple suit for accountant's fees brought by plaintiff against the Bank, the temporary administrator of the Estate, in its individual corporate capacity.The material facts of the case are not really in dispute, at least insofar as they relate to the appeal.The significance of the facts, though, is hotly contested by the parties; therefore, we shall endeavor to relate the events which gave rise to the controversy in as much detail as necessary.

Mrs. Kosar died on April 26, 1974, in Corpus Christi, Texas.Shortly after her death, Richard B. Stone, an attorney who had prepared a will for her in 1971, visited the Bank and advised David Brannon, an officer in its trust department, that the decedent, in the 1971 will, had named the Bank as independent executor.Brannon, acting for the Bank, agreed to attempt to qualify as independent executor, and requested Stone to probate the will.Brannon asked Stone the identity of Mrs. Kosar's accountant.Stone told him that plaintiff had attended to the testatrix's accounting needs before her death.Stone testified that Brannon then indicated an intention of the Bank to retain plaintiff as an accounting firm in connection with its handling of the Estate.Brannon, however, had no personal recollection of any conversation with Stone concerning, specifically, the hiring of an accounting firm.Brannon testified that plaintiff was not retained by the Bank to furnish accounting services for the Estate until after the Bank became temporary administrator thereof.This was disputed by Cross, who testified to a telephone conversation with Brannon that took place about one week after Mrs. Kosar's death, in which, according to Cross, Brannon requested that plaintiff prepare a federal estate tax return for the Estate.

Stone further testified that he was given authority to deal with plaintiff on behalf of the Bank, and that he personally informed plaintiff that the Bank desired it to perform accounting services in connection with the Estate.This was consistent with Cross's testimony relating to the aforesaid telephone conversation with Brannon about a week after Mrs. Kosar's death.

It soon became apparent to all concerned that the contemplated probate of the 1971 will would not be a simple matter.About the time that Stone filed the 1971 will for...