Cullum v. General Motors Acceptance Corporation

• Decision Date: 21 March 1938
• Docket Number: No. 4873.,4873.
• Citation: 115 S.W.2d 1196
• Parties: CULLUM et al. v. GENERAL MOTORS ACCEPTANCE CORPORATION et al.
• Court: Texas Court of Appeals

Page 1196

115 S.W.2d 1196

CULLUM et al. v. GENERAL MOTORS ACCEPTANCE CORPORATION et al.

No. 4873.

Court of Civil Appeals of Texas. Amarillo.

March 21, 1938.

Rehearing Denied May 2, 1938.

Appeal from District Court, Potter County; W. E. Gee, Judge.

Action by Dyke Cullum and others against the General Motors Acceptance Corporation and others to recover actual and exemplary damages allegedly caused by the breach of a contract and by the making of false and malicious statements against the named plaintiff and his business standing. From a judgment of dismissal, plaintiffs appeal.

Affirmed.

Works & Bassett and Clem Calhoun, all of Amarillo, for appellants.

Simpson, Dorenfield & Fullingim and E. H. Foster, all of Amarillo, for appellees.

STOKES, Justice.

This suit was filed in the district court of Hutchinson county by the appellant, Dyke Cullum, on the 23d of June, 1933, and afterwards, by agreement of the parties, transferred to and filed in the 108th district court of Potter county. On the 8th of January, 1937, appellant filed his fourth amended original petition, to which appellees filed a general demurrer and a large number of special exceptions. The general demurrer was overruled, but a number of the special exceptions were sustained, which action of the court practically destroyed the cause of action pleaded by appellant and he declined to amend. The court thereupon dismissed the case, to which appellant duly excepted and has perfected an appeal to this court upon a number of assignments of error in which he complains of the action of the trial court in sustaining the special exceptions and dismissing the case.

In his fourth amended original petition appellant alleged that on or about the 22d of June, 1928, he was the duly constituted sales agent and local dealer of appellee Chevrolet Motor Company of Texas, his territory including the city of Borger and territory adjacent thereto, and that on or about the 2d of May, 1931, he was succeeded as such agent and dealer by Main Chevrolet Company, a closed Texas corporation, which he organized, financed, and conducted, and in which he was interested. He alleged that the Main Chevrolet Company continued as such agent and dealer until October 1, 1931, and that he, individually, and the Main Chevrolet Company carried on and conducted a general automobile and garage business, engaging in the sale and distribution of motor vehicles, handling, furnishing, and selling parts for such motor vehicles, and carrying on a general parts and repair department, all in accordance with sales agents' and local dealers' agreements with the Chevrolet Motor Company; appellant conducting the same from June 22, 1928, until May 2, 1931, and the Main Chevrolet Company conducting it from that date until October 1, 1931. He alleged that in connection with the sales agency arrangement and as a part of the same transaction by which he was constituted the local dealer, he was required by the Chevrolet Company to arrange a line of credit with appellee General Motors Acceptance Corporation to handle conditional sales contracts taken on the sales of motor vehicles to his customers, which line of credit was ultimately extended to $50,000; such arrangement being under what was known as GMAC Retail Plan No. 1. He alleged further that the original dealer's agreement was renewed and extended annually from August 1, 1928, to August 1, 1931. The corporation organized by him known as Main Chevrolet Company was created on May 2, 1931, and at that time the agreement was terminated between appellant and the Chevrolet Motor Company and a duplicate contract entered into between the Chevrolet Motor Company and the Main Chevrolet Company, a corporation, which continued on with the business until August 1, 1931, when same was again extended and renewed by the Chevrolet Motor Company with the Main Chevrolet Company for another year; the renewals and extensions being in accordance with the original agreement between appellant and the Motor Company of June 22, 1928. He alleged that upon each renewal and extension of the agreement all of the provisions of the original agreement of June 22, 1928, as to the handling of conditional sales contracts for the unpaid purchase price of motor vehicles, and for providing and maintaining a line of credit, which provisions were both verbal and written, were each and all brought forward, renewed, and made a part of each extension agreement, and continued to constitute the agreement between the interested parties until the relationship was finally ended on October 1, 1931.

Further allegations were to the effect that both of the appellees, viz., the Chevrolet Motor Company of Texas, a corporation, and General Motors Acceptance Corporation, are subsidiaries of General Motors Corporation; the Motor Company being the sales or distributing agency and the Acceptance Corporation being the financing agency of the General Motors Corporation, and that both of appellees were jointly and severally interested in the local dealer's business at Borger in which appellant was interested, both individually and as a stockholder in the Main Chevrolet Company. He alleged that in the arrangement between them, the Acceptance Corporation agreed to follow up and keep the local dealer advised of delinquencies of purchasers of motor vehicles from the local dealer, and to co-operate with him in making collections and repossessing cars where necessary, and that the plan or agreement under which the relationship existed provided for insurance against fire, theft, conversion, confiscation, and collision, and for a reserve fund to be maintained for the benefit of the local dealer.

It was further alleged that the plans under which the relationships existed were printed memoranda, referred to and made parts of the more general and comprehensive agreements between the parties, which agreements were partly verbal and partly made up of such printed memoranda, and that upon the execution by the purchasers of motor vehicles sold on credit of conditional sales contracts to appellant during the terms of his local dealer's contracts and to the Main Chevrolet Company from May 2, 1931, to October 1st of that year, it was the general custom to assign such conditional sales contracts to the Finance Corporation as collateral and as evidencing appellant's indebtedness to it, he recommending and guaranteeing performance of such contracts, and that during all said time appellant, during his tenure, and the Main Chevrolet Company, during its tenure, so transferred, guaranteed, and became liable for the payment of such contracts; the consideration for such assignments and indorsements being the verbal promise and agreement of the Finance Corporation to advance and loan the amounts represented thereby as part of the line of credit provided for in the plans under which the relationship was carried on.

In addition to the written memoranda and written provisions of the contracts and agreements, appellant alleged that on or about the 1st of August, 1929, it was verbally agreed that appellant should have the right and it should be his duty to make all repossessions of automobiles theretofore sold that he deemed proper and necessary, and that he should keep in touch with the purchasers and make collections from them and assist the Acceptance Corporation, and it would assist him in every way possible to collect the amounts due on all outstanding conditional sales contracts, and it would furnish him with statements of payments made upon them and balances due thereon; that it would send one of its agents as a collector to the city of Borger twice each month to assist appellant in the collection of all moneys due under the contracts, especially those individually guaranteed by appellant, and that under this arrangement a large number of such conditional sales contracts involving many vehicles and large sums of money were handled to the great profit of appellant and also to the benefit and profit of the Main Chevrolet Company, as well as that of appellees, and that all of such terms, provisions, and obligations remained in full force and effect during all the time the relationship existed. Appellant alleged that he, personally, as well as an officer and stockholder in the Main Chevrolet Company, fully kept and performed all of the agreements and obligations resting upon him until they were breached, repudiated, and abandoned by appellees on or about the month of July, 1931, and that after that date he fully performed all of such agreements which arose prior to May 2, 1931, the date upon which the Main Chevrolet Company was organized as a corporation.

Further allegations of appellant were to the effect that the local dealer's business at Borger was incorporated into Main Chevrolet Company, with the understanding and agreement with appellees, through their agents and representatives, that same would not be liquidated as a business under the sales agreement on account of such incorporation, but that it would be carried forward by the Main Chevrolet Company without liquidation or change in method of operation, and that thereafter appellees pursued the business in accordance with that understanding; that from and after the 1st of July, 1931, the appellees, each acting for itself and also conspiring and confederating with each other, undertook to destroy appellant's business standing and to drive him, individually, out of business, and to destroy the business of the Main Chevrolet Company and the value of its capital stock; that pursuing such design and conspiracy, appellees breached, violated, and repudiated the contracts and agreements theretofore made with appellant, including some of those made before May 2, 1931, with appellant individually, and that the Acceptance Corporation refused to make payments to him from the cash reserve fund on hand after May 2, 1931, in accordance with the agreement with appellant individually and...