Douglass v. Panama, Inc.

• Decision Date: 19 July 1972
• Docket Number: No. 659,659
• Citation: 487 S.W.2d 228
• Court: Texas Court of Appeals
• Parties: G. D. DOUGLASS et al., Appellants, v. PANAMA, INC., et al., Appellees. (14th Dist.)

Page 228

487 S.W.2d 228

G. D. DOUGLASS et al., Appellants, v. PANAMA, INC., et al., Appellees.

No. 659.

Court of Civil Appeals of Texas,

Houston (14th Dist.).

July 19, 1972.

Rehearing Denied Sept. 13, 1972.

John P. Spiller, Spiller & Spiller, Charles L. Black Aycock, Houston, for appellants.

M. W. Parse, Jr., Fulbright, Crooker & Jaworski, Houston, for appellees.

BARRON, Justice.

This is a suit filed by G. D. Douglass and thirteen other former employees of Panama, Inc. as plaintiffs, against Panama, Inc. and its parent company, Associated Oil and Gas Company, both corporations, seeking recovery for certain bonuses, sick leave and vacation pay which the plaintiffs allege they had been promised and should be paid for the year 1965. It is alleged that the benefits above were promised by M.E. 'Panama' Shiflett, President of Panama, Inc., with full power and authority over the company's affairs, at least until 1962 or 1963, when the company was bought by Associated Oil and Gas Company, a foreign corporation. Panama, Inc. was a corporation engaged in the business of constructing, building and laying pipelines for the transmission of oil, gas and other petroleum products. The business was organized a number of years ago by M. E. Shiflett, called Panama shiflett, who knew the business, got along with his employees who were willing to work, and learned such business of 'pipelining' by hard work and actual experience.

After trial before a jury, the trial court granted defendants' motion to disregard special issues and for judgment non obstante veredicto and rendered judgment in favor of Panama, Inc. and Associated Oil and Gas Company that the plaintiffs take nothing. Hence, this appeal by the fourteen plaintiffs above who appear as appellants. Both corporations are appellees, and the parties usually will be hereafter so designated.

The trial court submitted 57 special issues to the jury dealing with 14 parties plaintiff. While appellees excepted to the trial court's permitting this case to be tried as filed and excepted to the overruling of their motions to sever and plea of misjoinder, we think, though some difficulty results in the action by reason of the many plaintiffs involved, the trial court was within its discretion in overruling the motions, and that the actions are based upon common or related facts generally. A multiplicity of suits was avoided by the trial court's action. Appellees' complaints above are overruled.

All of the 57 special issues mentioned above were answered in favor of appellants. While the issues dealt with 14 appellants separately, they may be illustrated as follows:

'Special Issue No. 1

Do you find from a preponderance of the evidence that during the years 1964 and 1965, Panama, Inc., by and through its President, M. E. Shiflett, Agreed to pay to Gloria Beaird a bonus for pipeline construction services performed by Gloria Beaird for Panama, Inc., during the year 1965?

Answer: We do.

If you have answered Special Issue No. 1 'We do', and only in that event, then answer:

'Special Issue No. 2

Do you find from a preponderance of the evidence that Gloria Beaird performed pipeline construction services for Panama, Inc., during the year 1965 in Reliance on such agreement, if any you have so found?

Answer: We do.

If you have answered Special Issue No. 2 'We do', and only in that event, then answer:

'Special Issue No. 3

What do you find from a preponderance of the evidence was the amount of such bonus So agreed to be paid to Gloria Beaird, if any you have so found?

Answer: $1,000.00.

If you have answered Special Issue No. 3 in any amount, and only in that event, then answer:

'Special Issue No. 4

Do you find from a preponderance of the evidence that under such agreement, if any, with Gloria Beaird, the payment of the bonus was not conditional on Panama, Inc. making substantial profits for the year 1965?

Answer: It was not conditional.

'Special Issue No. 57

Do you find from a preponderance of the evidence that for the year 1965, Panama, Inc. did make substantial profits?

Answer: It did not make substantial profit.' (Emphasis added)

With the exception of change of the name of a given party, the first four issues were repeated throughout the charge, until special issue number 57 was reached. The answer to the latter applied, of course, generally. Various sums were found by the jury as representing the amount of the bonuses allegedly agreed to be paid ranging from $1,000.00 to $8,000.00. A total of $71,728.00 was found to have been promised as bonuses. The pleaded matter of sick leave and vacation pay were not submitted to the jury, and those items were accordingly waived by appellants for failure to preserve error, if any. The record is somewhat cumbersome and lengthy, the statement of facts alone consisting of 600 pages in addition to many exhibits. Quantum meruit was not pleaded, and the case was not tried on that theory.

Appellants contend that the trial court erred in rendering judgment n.o.v. because a verdict was returned for appellants on sufficient evidence for recovery of bonuses and because the trial court erred in failing to make findings as stipulated on attorneys' fees which were agreed to be heard by the court without a jury.

We have carefully reviewed the evidence and the record in this case under somewhat difficult conditions as above indicated, and we are of the opinion that the trial court correctly disregarded special issues number 4, 8, 12, 16, 20, 24, 28, 32, 36, 40, 44, 48, 52, 56, and 57 as being based upon legally insufficient testimony to support jury findings thereon. At best, a mere scintilla of evidence appears in the record to support the above issues. There is 'no evidence' when the testimony submitted rises no higher than a surmise or suspicion. Rigsby v. Pitner, 334 S,.W.2d 837 (Tex.Civ.App., Houston 1960, writ ref'd n.r.e.); Joske v. Irvine, 91 Tex. 574, 44 S.W. 1059, 1063 (1898). The foregoing disregarded issues deal with the alleged bonuses as conditioned upon Panama's earning of a profit for the year 1965.

Most of the appellants had been employed by Panama, Inc. for several years. Shiflett testified that his employees were promised when he hired them that there would be a salary and a bonus. In 1962, Panama, Inc. had a net loss before taxes of $83,116.00. For that year of 1962, a total of all bonuses paid was $3,100.00. For the year ended December 31, 1963, Panama, Inc. had a net loss before taxes of $344,523.00. Total bonuses that year were $2,075.00. For Panama, Inc., 1964 was an extremely profitable year. That year, its net income before taxes was $1,963,335.00 and bonuses paid totaled $138,956.00. We think it clear and undisputed in effect that substantial bonuses were paid only when profits were made. Panama Shiflett himself repeatedly confirmed such fact. He testified that 'If we didn't make any money, they (the employees) got nothing', and 'They knew if we made money they would get a bonus because we had been doing that and that was our policy.' Many statements were made by Shiflett reflecting that bonuses depended entirely upon profits, and he stated several times that he did not desire to change his testimony along that line in any respect.

Panama Shiflett told his key employees in 1965 and 1966 that he had no authority to write checks for bonuses unless the Board of Associated Oil and Gas Company approved it. Later facts bear this out. He further confirmed that he made no statement to any employee concerning the amount of any bonus which he anticipated paying. Bonuses varied from year to year, and there was no set pattern. Several appellants also testified that bonuses were related to and dependent upon profits. Apparently, the board of directors agreed to the bonuses paid from 1962--1964.

Panama, Inc. paid all of the appellants except Griffis, who was not employed in 1964, substantial bonuses for the year 1964 in addition to their salaries. All appellants who testified related such agreements or statements regarding bonuses made by Panama Shiflett as 'If we get this deal over, there will be a good bonus for all of us'; 'Get with it and there will be a good bonus next year'; 'Now, let's get with it, do a good job and you will get a good bonus'; 'I hope it will be better next year'; 'Your bonus will be as good or better next year'; 'We were assured that we would receive as much or more than we received in 1964'; 'If we swing this contract--we're talking about (a bonus of) $25,000.00'; 'There will be a lot more next year if we just keep a'digging and get after it.' Similar alleged promises were shown throughout the testimony on the part of Panama Shiflett to appellants. Testimony showed that such statements were made near Christmastime, in late 1964, in early 1965, when Shiflett handed an employee his bonus check for 1964, when he was visiting one of his jobs, and at a groundbreaking ceremony for the Associated Oil and Gas Company Building.

In 1962, Associated Oil and Gas Company purchased 80% Of the stock in Panama Inc., and by 1963 all of it had been purchased by Associated. There was a change in ownership and management policy. However, Panama Shiflett continued to act as President of Panama, Inc. and 'ran' the company. He was placed on the 'big board' (Board of Directors of Associated Oil and Gas Company) from 1963 until 1966. After Associated purchased the company, Shiflett's powers were, of course, curtailed, as noted by him when he told his key employees that he had no authority to write checks for bonuses unless Associated gave its permission. When Associated purchased the stock of the company, Shiflett tried hard to obtain stock-options for his employees and himself, which were apparently promised by Associated at the time of purchase. However, such a plan was disapproved in 1965, and the stock-option plan failed. He, therefore, conditionally promised (if the above are promises) the employees of Panama, Inc. a bonus for 1965. ...