Davis v. Alwac Intern., Inc.

• Decision Date: 02 May 1963
• Docket Number: No. 6545,6545
• Citation: 369 S.W.2d 797
• Parties: Felix A. DAVIS v. ALWAC INTERNATIONAL, INC., et al.
• Court: Texas Court of Appeals

Page 797

369 S.W.2d 797

Felix A. DAVIS v. ALWAC INTERNATIONAL, INC., et al.

No. 6545.

Court of Civil Appeals of Texas, Beaumont.

May 2, 1963.

Rehearing Denied June 26, 1963.

Nowlin Randolph, Houston, for appellant.

Baker, Botts, Andrews & Sheperd, Houston, for appellees.

McNEILL, Justice.

Monorail, Inc., was organized in Houston in 1955 to develop monorail transportation. Its three moving spirits from mid 1955 through September, 1959, were Murel Goodell, president, Weldon Appelt, a vice president, and appellant Felix A. Davis, a vice president, director and member of the company's executive committee. By 1957 Monorail Inc., was in financial straits. Knowing that the Swedish international financier, Dr. Axel Wenner-Gren was also very interested in monorail transportation, the three, Goodell, Appelt and Davis, visited him in Mexico City on January 7, 1957. As a result of that visit the Wenner-Gren interests invested $300,000.00 in Monorail, Inc., stock and advanced Monorail, Inc., $400,000.00 over the period of a year or more.

The present suit by appellant Davis was also a result of the meeting with Dr. Wenner-Gren. Davis sued appellees, Alwac International, Inc., Wegematic Corporation, Alweg Corporation and Monorail, Inc., insofar as now material, upon two causes of action. The first was for past due salary of $51,550.00 @ $3,000.00 per month which he claimed appellees owed him based upon a contract of employment made originally in 1956 between him and Monorail, Inc., and also upon an alleged agreement which was made when he, Appelt and Goodell visited Wenner-Gren in Mexico City on January 7, 1957. In addition, appellant alleged that Dr. Wenner-Gren, at that meeting, undertook to and did agree to pay him, Davis, through corporations controlled by Wenner-Gren, the salary which Monorail, Inc., had contracted to pay; that the four companies sued were controlled by Wenner-Gren and were a part of the Wenner-Gren interests. The other count in appellant's suit was one sounding in tort based upon the allegation that termination on September 27, 1959, of his employment with Monorail, Inc., under the written employment contract made by the board of directors of said company with him was the result of a conspiracy to discharge him made prior to June 1, 1958, between the four companies sued. Appellees answered the suit and pleaded, among other defenses, Subsection 2 of the Statute of Frauds. In addition, Monorail, Inc., filed cross-action against appellant to recover certain inventions or improvements made by appellant upon that company's equipment while he was connected with it.

The case was submitted to the jury upon 51 issues. In response to Issue No. 5, the jury found that Axel Wenner-Gren on January 7, 1957, agreed to pay appellant's salary 'through corporations controlled by him'. In response to Issue No. 24, the jury found that on said date appellant refused direct employment by the Wenner-Gren interests and in response to Issue No. 25, they found that the 'main purpose and object' of the agreement made by Dr. Wenner-Gren, was to guarantee payment to Davis of his salary if Monorail, Inc., did not pay the same. While Dr. Wenner-Gren testified in this cause by deposition, he was never made a party thereto. After verdict, appellees filed their motion for judgment, or alternatively, motion for judgment, n. o. v., or alternatively, motion to disregard certain issues. In accordance with the prayer of this composite motion, the court gave appellant judgment for exactly the amount prayed for by appellant in his motion for judgment but limited his recovery to appellee, Monorail, Inc. Since Monorail's position is different on this appeal from that of the other three appellees, when referring herein to the latter three, they will be called Alwac, Alweg and Wegematic.

Appellant attacks this judgment upon numerous grounds, none of which we conclude are sound. First, he says that since appellees, including Monorail, Inc., moved the court to render judgment in appellant's behalf against Monorail, Inc., for the amount recovered, this necessarily established three things: (1) the amount of salary due $51,550.00; (2) that appellees adopted the jury's answer to Special Issue No. 5 which found that Wenner-Gren on January 7, 1957, agreed to pay Davis' salary through corporations controlled by him; and (3) in answer to Special Issue No. 7, the jury found appellant's attorneys fees to be $14,000.00. Appellant then reasons from this premise that having recognized Wenner-Gren was to pay Davis' salary through controlled corporations, and asserting Alwac, Alweg and Wegematic were controlled by Wenner-Gren, they cannot escape the same judgment. In answer to this proposition, it appears that at no place in the judgment rendered by the court does the court or Alwac, Alweg and Wegematic, or Monorail, Inc., for that matter, approve, recognize or adopt Issue No. 5. The judgment recites that appellant's motion for judgment was overruled and then states:

'and the Court having heard and granted the defendant's motions for judgment, or alternatively motion for judgment non obstante veredicto, or alternatively motion to disregard certain special issues, and alternatively objections to plaintiff's motion for judgment, and plaintiff's attorney having been served with the same and having appeared in answer thereto; and the Court being of the opinion that Special Issues Nos. 24 and 25 and the answers thereto are proper and are supported by the evidence and that they constitute a defense in law as to the defendants Alwac International, Inc., Wegematic Corporation, and Alweg Corporation, and the Court being of the further opinion that judgment should be rendered for the plaintiff Felix A. Davis against only the defendant Monorail, Inc., for $73,256.04 on plaintiff's cause of action for salary (said sum of $73,256.04 consisting of $14,000.00 found as attorney's fees and the agreed sum of $51,550.00 as salary, with interest at 6% per annum. * * *)'

In view of the alternative sections of appellees' motion, it cannot be said that the sufficiency of Issue No. 5 was recognized or approved. 4 McDonald, Tex.Civ. Practice, Sec. 17.32, p. 1414. And it was stipulated that the balance owing in salary to appellant was $51,550.00. The judgment for the salary, interest and atty's fees went against Monorail, Inc., only. There is no rule that one (Monorail, Inc.) actually acknowledging owing the money may not, either by admission or confession, or on one of several causes of action, allow a party to recover judgment without helping him create a theory against other defendants who are differently situated. The fact that Monorail, Inc., is willing to acknowledge responsibility for a debt it admits owing does not bind the other appellees to accept the loosely knit terms of Special Issue No. 5.

In this connection, Alwac, Alweg and Wegematic assert that Special Issue No. 5 is too indefinite upon which to establish any liability against them for several reasons. First, there is no finding by the jury as to the identity of the 'so-called' controlled corporations. Second, there is no finding that these corporations were the alter ego of the Doctor, nor that the Doctor was the alter ego of these corporations. Third, there was a failure upon the part of appellant to establish that Dr. Wenner-Gren was authorized by any of the appellees to speak for it. We think these points pose serious problems in connection with appellant's proof. However, we think it unnecessary to pass upon the points as it is our opinion that the defense urged by Alwac, Alweg and Wegematic that the promise of Wenner-Gren, if made, was one to answer for the debt, default or miscarriage of another is sound and defeats appellant's recovery as to the three.

In connection with this defense under Art. 3995, it will be recalled that the 24th jury finding was that appellant refused direct employment by the Wenner-Gren interests; and the 25th finding was that in agreeing to pay appellant's salary through corporations controlled by him, Wenner-Gren undertook to guarantee payment to Davis of his salary if Monorail, Inc., did not pay the same. Appellant asserts we should not consider the 24th finding because Issue No. 24 is not an ultimate but an evidentiary issue. This perhaps is true, but we need not decide the question. From evidence presently to be pointed to, it is shown that Wenner-Gren attempted, in the conference he had with them on January 7, 1957, to give the three, Davis, Appelt and Goodell, direct employment, but they declined. That they did decline, that they were not directly employed by Wenner-Gren, was an item for the jury to consider in answering the 25th issue. Appellant next asserts that there is no evidence to support these findings. The evidence clearly supports the 24th: Appellant and Appelt testified Wenner-Gren wanted to hire Davis but Davis refused; on appellant's attorney's fee, appellant's attorney asked the hypothetical question to the expert on such fees, 'The European capitalist at his conference first offered to employ the three officers of the Houston Monorail Co. (Goodell, Davis and Appelt) but * * * they declined * * *----.' There is also evidence supporting the 25th finding: Wenner-Gren denied he made any promise to pay Davis' salary; Davis said the doctor stated, 'You will not have to worry about your salary'; appellant testified the doctor said, 'He would personally see that our compensation was arranged for.' Also bearing on this issue, the salary contract was made directly by Davis with the board of Monorail, Inc., for whom he actually worked; this board had set the amount and manner of payment; not once did Davis call upon Wenner-Gren or the three appellees, nor did any of them pay him salary, although Monorail, Inc., was in arrears for a year and a half; not once during the time involved did Davis tell the board of Monorail, or any other person, so far as the...