Credit Plan Corp. of Houston v. Gentry

• Citation: 516 S.W.2d 471
• Decision Date: 06 November 1974
• Docket Number: No. 1011,1011
• Parties: CREDIT PLAN CORPORATION OF HOUSTON et al., Appellants, v. John B. GENTRY et ux., Appellees. (14th Dist.)
• Court: Texas Court of Appeals

Page 471

516 S.W.2d 471

CREDIT PLAN CORPORATION OF HOUSTON et al., Appellants, v. John B. GENTRY et ux., Appellees.

No. 1011.

Court of Civil Appeals of Texas Houston (14th Dist.).

Nov. 6, 1974.

Rehearing Denied Nov. 27, 1974.

D. R. Bernard; Bernard & Bernard, Houston, for appellants.

Edwin H. Momberger, Houston, for appellees.

TUNKS, Chief Justice.

This is an unreasonable collection efforts case. Appellants, Credit Plan Corporation of Houston, Colonial Finance Corporation, Kelcor Corporation, and Joe Assad, appeal from the trial court's judgment on a jury verdict awarding appellees, John and Eileen Gentry, $69,747.35 actual and $69,447.35 punitive damages.

In 1968, the Gentrys borrowed money from Credit Plan Corporation of Houston (hereinafter referred to as Credit Plan). They were behind in their payments for November and December, 1968, and for January, 1969. During January, the Gentrys started receiving telephone calls from Credit Plan employees concerning their delinquency in making payments. During February, 1969, the calls become more frequent, and at least one call was made to John Gentry's employer. On the evening of February 7, 1969, Joe Assad, an assistant collection manager of Credit Plan, acting within the scope of his employment, called at the Gentry home in person. An argument ensued between the Gentrys and Assad. Shortly after Assad left, John Gentry suffered a coronary occlusion and was admitted to the hospital. He remained there until April 1, 1969, and was readmitted for treatment for precardial pain during several weeks in July, 1969. During Gentry's first hospitalization, his family continued to receive telephone calls from employees of Credit Plan. The Gentrys' debt to Credit Plan of some $158.00 has since been paid by proceeds from an insurance policy taken out as a requirement for the loan.

The Gentrys timely filed a petition for damages arising out of these collections efforts against Credit Plan, Assad, and C. V. Blankenship, who had made most of the telephone calls. On May 17, 1972, over three years after the events occurred from which their cause of action arose, the Gentrys filed a second amended petition naming as defendants Credit Plan, Assad, and Blankenship, and adding Colonial Finance Corporation (Colonial) and three individuals, who were officers, stockholders, and directors of both Colonial and Credit Plan. The petition stated that Credit Plan was actually the alter ego of Colonial, and allegations were made to support this contention. Thereafter, on February 7, 1973, the Gentrys filed a third amended petition, naming as defendants Credit Plan, Colonial, and Assad, and adding as a defendant Kelcor Corporation (Kelcor). It was alleged that Kelcor was incorporated on May 12, 1969, as a holding company, and that all of Colonial's assets were transferred to Kelcor in an attempt to further insulate Credit Plan from liability in the Gentrys' cause of action. Facts were alleged in the petition to show that Credit Plan was the mere alter ego of Colonial and Kelcor and completely under their control.

On May 18, 1973, Colonial and Kelcor filed a motion for summary judgment, basing their motion in part on the two-year statute of limitations. Vernon's Tex.Rev.Civ.Stat.Ann. art. 5526 (1958). This motion was overruled. Discovery continued and the case was tried before a jury in October 1973. Under Texas Rules of Civil Procedure, rule 174(b), the court ordered separate trials of the two main issues in the case. The jury first heard evidence and answered special issues pertaining to the Gentrys' tort action, and then the issue of whether Credit Plan was the alter ego of Colonial and Kelcor was tried.

The jury found that Credit Plan's collection efforts during the period of February 1, 1969, through April 15, 1969, were unreasonable, that they were the proximate cause of any physical illness, or physical or emotional pain suffered by John Gentry, that they were the cause of any illness or emotional pain suffered by Eileen Gentry, and that John Gentry did not provoke the altercation between himself and Assad on February 7, 1969. The jury awarded John Gentry $10,000 for past and future pain and mental anguish, $39,750 for past and future loss of earnings, and $9,497.35 for past and future medical expenses. Eileen Gentry was awarded $10,000 for past and future mental anguish and $500 for loss of consortium. The jury further found that Credit Plan's collection efforts were carried out with malice toward the Gentrys, and an award of $69,447.35 punitive damages was made. By their answers to supplemental issues, the jury found that at all times material to the cause of action, both Colonial and Kelcor exercised complete control over Credit Plan to the extent that the three corporations had the same owners, the same officers, and the same assets.

Appellants made motions for instructed verdict, to disregard the jury findings, and for judgment n.o.v., all of which were overruled. On November 19, 1973, the trial court entered judgment on the verdict for the Gentrys, and the appellants' motion for a new trial was subsequently overruled. All the appellants have perfected an appeal.

Numerous points of errors are assigned on this appeal, but most of them may be discussed under several major issues.

I. STATUTE OF LIMITATIONS

Appellants Kelcor and Colonial argue that any claim for personal injuries against them arising out of events in February through April, 1969, is barred by the two-year statute of limitations. Tex.Rev.Civ.Stat.Ann. art. 5526 (1958). We agree. Appellees contend that because Credit Plan was the alter ego of Kelcor and Colonial, service on Credit Plan constituted notice to the other two corporations. However, the cases relied on by appellees presented the situation either of misnomer of a defendant who had been timely served with citation and answered, or of change in the capacity in which the defendant was sued. See e.g., Hallaway v. Thompson, 148 Tex. 471, 226 S.W.2d 816 (1950); Callan v. Bartlett Electric Cooperative, 423 S.W.2d 149 (Tex.Civ.App.--Austin 1968, writ ref'd n.r.e.); National Transfer & Rigging Co. v. Clark, 249 S.W.2d 630 (Tex.Civ.App.--Galveston 1952, writ ref'd n.r.e.).

Where one sues an existing entity, the filing of such suit will not ordinarily toll the running of limitations as to the claim against another existing entity. Lunsford v. Sage, Inc. of Dallas, 438 S.W.2d 615 (Tex.Civ.App.--Houston 1st Dist. 1969, writ ref'd n.r.e.); Krenek v. Epps Super Market No. 2, Inc., 377 S.W.2d 753 (Tex.Civ.App.--Austin 1964, no writ); West v. Johnson, 129 S.W.2d 811 (Tex.Civ.App.--Fort Worth 1939, writ ref'd). The existence of the defendants originally sued by these plaintiffs and of the later joined defendants, Kelcor and Colonial, is not questioned. The fact that the two later defendants were using their wholly owned subsidiary, Credit Plan, as their alter ego and agent in accomplishing their own purpose is immaterial. A plaintiff does not, by suing an agent or employee, thereby toll the running of limitations as to the plaintiff's claim against the defendant's principal or employer. Therefore, Article 5526 is a bar to the appellees' cause of action against appellants Colonial Finance Corporation and Kelcor Corporation, and the trial court's judgment against them is reversed and judgment is rendered in their favor.

II. UNREASONABLE COLLECTION EFFORTS

Appellants assign as error the submission to the jury of certain issues and the trial court's refusal to submit other issues requested by appellants. However, the record filed in this Court within the sixty-day time limit fails to show that appellants preserved these points of error by making proper objections in writing to the trial court before the case was submitted to the jury . Under Tex.R.Civ.P. 272, these points were waived and may not be passed upon on appeal. Cody v. Mahone, 497 S.W.2d 382 (Tex.Civ.App.--San Antonio 1973, writ ref'd n.r.e.); Carter v. Walton, 469 S.W.2d 462, 472--473 (Tex.Civ.App.--Corpus Christi 1971, writ ref'd n.r.e.).

Appellants, by their points of error 9 through 11, contend that the jury finding that Credit Plan and its employees used unreasonable collection efforts against the Gentrys is against the legal and factual sufficiency and great weight and preponderance of the evidence.

First, we must look only to the evidence and reasonable inferences therefrom in support of the verdict to see if there was any evidence from which a reasonable jury could conclude that Credit Plan committed acts constituting unreasonable collection efforts against the Gentrys. At the trial, Eileen Gentry testified that she told a Credit Plan employee in December 1968, or January 1969, that the reason they were late in making payments was because she had been ill and unable to continue her work as a nurse, but that she was returning to work in early January. She testified that during January, a Mr. Blankenship from Credit Plan began calling her every day, which disrupted her sleep since she was working at night. She said that at least once, she received a telephone message at work that Mr. Blankenship called. John Gentry testified that his wife had explained why they were delinquent in payments to Credit Plan employees on numerous occasions.

On February 7, 1969, Gentry stated that he had a message to call a Mr. Ayers at Credit Plan. He tried to return the call twice, but each time a secretary put him on 'hold' for several minutes, so he hung up since he did not want to tie up his company's lines. Gentry testified that shortly after he arrived at home that evening, Joe Assad came to see him. He said Assad was a large man with a scowling face and a heavy voice. Gentry said that immediately upon entering, Assad asked him why he had not returned their call. Gentry tried to explain, but Assad called him a 'damn liar,' and said Gentry hadn't tried to return the call. Gentry testified that Assad stood over...