Ferrier Bros. v. Brown

• Decision Date: 09 November 1962
• Docket Number: No. 3747,3747
• Citation: 362 S.W.2d 181
• Parties: FERRIER BROTHERS et al., Appellants, v. T. M. BROWN, Jr., et al., Appellees.
• Court: Texas Court of Appeals

Page 181

362 S.W.2d 181

FERRIER BROTHERS et al., Appellants, v. T. M. BROWN, Jr., et al., Appellees.

No. 3747.

Court of Civil Appeals of Texas, Eastland.

Nov. 9, 1962.

Rehearing Denied Nov. 30, 1962.

Bradbury, Tippen & Brown, Abilene, R. J. Balch, Seymour, for appellants.

McMahon, Smart, Sprain, Wilson & Camp, abilene, for appellees.

GRISSOM, Chief Justice.

Ferrier Brothers was the prime contractor for construction of a part of Interstate Highway Number 20 around Abilene. Article 5160, known as the McGregor Act, required that they file with the State a performance bond and a payment bond. Seabord Surety Company became Ferrier Brothers' surety on such bonds. The Browns became Ferrier Brothers' subcontractor for a portion of said work. The Browns subcontracted the same work to T. F. Hill. The subcontract was performed by Hill, as an independent contractor. It was completed and accepted by the State in February 1961. Apparently, Hill performed a portion of the work with machinery purchased from Darr Equipment Company and while the work was being done Hill's note to Darr became due and Ferrier Brothers, at Hill's request but without notice to the Browns, made a payment of $10,070.00 to Darr. That amount was withheld by Ferrier Brothers from its payment to the Browns. After the Browns' subcontract was completed, they timely and in the manner required by law filed with Ferrier Borthers and said surety their claim under the McGregor Act for the unpaid balance. It is undisputed that the Browns' subcontract was performed and that Ferrier Brothers received full payment from the State for the job. The claim filed by the Browns totaled $37,418.80, which was $64.09 more than Ferrier Brothers in their original answer admitted they owed. The claim for the $64.09 was abandoned by the Browns. The Browns sued Ferrier Brothers and their surety for the unpaid balance of their contract. The Browns' motion for a summary judgment was granted and judgment was rendered for them. Ferrier Brothers and Seaboard Surety Company have appealed.

Appellants contend the court erred (1) in striking their amended answer and crossaction, which was filed without leave of the court on January 15, 1962; (2) in overruling, on January 16th, their application for continuance of the hearing of the motion for summary judgment and (3) in granting plaintiffs' motion for a summary judgment.

In appellants' original answer, filed in June, 1961, they alleged Hill was asserting a claim to the money owed by Ferrier Brothers to the Browns and they took the position that they were stake holders to the extent of $27,284.71. They denied that the Browns were entitled to $10,070.00 which had been paid by Ferrier Brothers to Darr on behalf of Hill and charged to the Browns. No deposit in court of the $27,284.71 was made. Ferrier Brothers made Hill a party to the suit and their then attorney filed an answer for him. Although Hill had claimed the Browns owed him some money on his subcontract, he later made an affidavit in which he denied that appellees were indebted to him, waived any claim to the money held by Ferrier Brothers for the Browns and swore, as he had in a previous deposition, that the $10,070.00 paid for him by Ferrier Brothers to Darr was for payment of his note to Darr for the purchase price of machinery. Hill acknowledged that he owed Ferrier Borthers said amount. The Browns filed a motion for a summary judgment, making Hill's affidavit and the pleadings and depositions on file a part thereof. Thereupon, appellants, on January 9, 1962, filed their supplemental answer and crossaction and a sworn answer to appellees' motion for a summary judgment. After due notice, the court held a pre-trial hearing on January 11th, taking up at that time appellees' motion for a summary judgment. The case had previously been set for trial on its merits on January 16, 1962. The court reserved decision of appellees' motion for summary judgment until that time. On January 16, 1962, the court held there was no genuine issue as to any material fact and granted appellees' motion for a summary judgment.

Appellants did not refute the affidavit of Hill or the depositions on file. They did not present counter affidavits or evidence, nor did they offer any excuse for their failure to do so. Appellants' amended answer and cross-action, filed without leave of the court on January 15, 1962, was stricken. Their motion for a continuance, filed on January, 15th, was deenied and, the amount of attorneys' fees being stipulated, judgment was rendered for the Browns for the unpaid balance of their contract and for attorneys' fees.

Appellants say the court erred in striking their amended answer and cross-action; that amended pleadings and supporting instruments may be filed at any time before a hearing of the motion for summary judgment and that said pleading was filed before said hearing; that the provision in Texas Rules Civil Procedure 63, that leave of court must be had for amending pleadings within 7 days of trial applies to a trial on the merits, but not to a hearing of a motion for summary judgment. In support thereof it cites Green v. Smart, Tex.Civ.App., 333 S.W.2d 880; Archer v. Skelly Oil Company, Tex.Civ.App., 314 S.W.2d 655, (Ref. N.R.E.), 159 Tex. 154, 317 S.W.2d 47; Hammett v. Fleming, Tex.Civ.App., 324 S.W.2d 70, (Ref. N.R.E.) and Womack v. Allstate Insurance Company, (Sup.Ct.), 156 Tex. 467, 296 S.W.2d 233.

Appellants contend that, notwithstanding the striking of said pleading, there remained pleadings, affidavits and evidence sufficient to raise the following fact issues: (1) Was the $10,070.00 payment by Ferrier Brothers to Darr for rent on equipment? (2) Was Hill Brown's subcontractor, or a partner, agent or employee? (3) Was Hill at the time he was working on the project a partner of the Browns and (4) was the conduct of the Browns in permitting Hill to do the work such that it would be unjust and inequitable to refuse Ferrier Brothers a recovery of the $10,070.00 from the Browns, who caused the condition which required Ferrier Brothers to make said payment to Darr?

Appellants say that they submitted Darr's invoice which recited that the $10,070.00 charge was for rental on equipment; that the deposition of Vincent showed that such payment was for rental on equipment and that Vincent, Ferrier Brothers' Accountant and Office Manager, had been told by Darr that the $10,070.00 charge was for rent on equipment. They say that they thereby raised fact issues by pleadings which remained and their affidavits. With reference to appellants' contention that Hill was not a qualified, bona fide, subcontractor, they contend that a contractor is not permitted to subcontract more than half of his contract; that the Browns assigned their entire contract to Hill; that this was unlawful and, since Hill furnished no bond, the Browns and Hill became partners, or Hill was their agent or employee and, therefore, Ferrier Brothers were justified in withholding the $10,070.00 from the Browns, regardless of whether Ferrier Brothers' payment to Darr was for rent of equipment. Darr's invoice was inadmissible. It was hearsay. Vincent, Ferrier Brothers' Office Manager and Accountant, did claim the $10,070.00 paid by the Ferriers to Darr was for rent on equipment. But, all he knew about it was what Darr told him. This was not admissible against the Browns. Furthermore, he testified that he had heard the testimony that it was for the purchase of machinery, not for rent, and that he had no reason to doubt such testimony and that nothing in Ferriers' record, except Darr's invoice, showed it was for rent. Only Darr and Hill knew. Hill swore that the $10,070.00 note paid to Darr by Ferrier, for Hill, was given for the purchase price of machinery, nor for rental on machinery used on the job. Only Darr could refute this statement in Hill's affidavit and appellants did not produce such an affidavit, or testimony, of Darr. The testimony of Vincent, the Ferriers' representative, was to the effect that the Browns' subcontract to Hill was satisfactory to Ferrier Brothers. Hill performed his subcontract to the satisfaction of the State and the Ferriers received full payment on their contract with the State. There was no evidence that Hill was a partner or employee of the Browns. There is no justification for appellants' complaint that the Browns sublet to Hill their entire subcontract. The Highway Department's contract with Ferrier Brothers, the prime contractor, may have required that the Ferriers perform 50 percent of the work called for by their contract with the State. But, no contract or law making such a requirement of the subcontractors Brown has been pointed out or found.

Appellants' original answer was filed on June 5, 1961. In it appellants made Hill a party and their then attorney filed an answer for him in which it was alleged that Hill was an independent contractor. Appellees' motion for a summary judgment was filed on January 3, 1962. A copy was furnished Hill and appellants and they were given notice of a hearing thereof on January 15th. But, before that time the court directed all parties to appear on January 11th for a pre-trial hearing. All parties appeared on January 11th, and all motions, including appellees' motion for a summary judgment, were taken up and considered at that time. On January 9th appellants had filed an amended answer and cross-action and a sworn answer replying to appellees' motion for a summary judgment. The case had previously been set for trial on its merits several times. On at least three occasions the case had been continued by appellants. The last setting of the case for a trial on the merits was for January 16th. Appellants were notified thereof on December 19, 1961. At such pre-trial hearing on January 11th, the court reserved decision on appellees' motion for a summary judgment. On January 16th, the day the case was set for trial on its merits, the...