First State Bank of Riesel v. Dyer, 3010

• Decision Date: 24 April 1952
• Docket Number: No. 3010,3010
• Citation: 248 S.W.2d 785
• Parties: FIRST STATE BANK OF RIESEL v. DYER et al.
• Court: Texas Court of Appeals

Page 785

248 S.W.2d 785

FIRST STATE BANK OF RIESEL v. DYER et al.

No. 3010.

Court of Civil Appeals of Texas, Waco.

April 24, 1952.

Rehearing Denied May 22, 1952.

B. A. Garrett, O. M. Weatherby, Waco, for appellant.

Conway & Scharff, Waco, for appellees.

HALE, Justice.

Appellant, First State Bank of Riesel, sued appellees, O. G. Dyer and Clinton Woodside, to recover the amount alleged to be due it on a certain promissory note and to foreclose a chattel mortgage given to secure the payment thereof. It pleaded that appellees were partners doing business in the City of Waco under the partnership name of Waco Gibson Tractor Sales; that on December 30, 1948, appellees, acting through Woodside and his wife, borrowed $7324.50 from appellant, as evidence by their note of that date and a chattel mortgage given to secure the payment of such note; and that the note and mortgage were each signed by Woodside and his wife, but the money was borrowed by them for the Waco Gibson Tractor Sales and was used in the business of the partnership for the benefit of both partners. It prayed for judgment against both appellees, jointly and severally, in the amount of principal, interest and attorney's fees due upon the note, together with a foreclosure of its lien, and, in the alternative, that it have a joint and several judgment against both appellees for the unpaid balance of the amount it had loaned to them.

Woodside, having failed to appear in response to citation served by publication, was represented by a court appointed attorney who answered for him with a general denial and a plea that he delivered all the assets belonging to the partnership to Dyer at the time when the partnership was dissolved and that such assets were sufficient in value to discharge all obligations of the partnership. He prayed, in the event any judgment be rendered against him, that he have judgment for such amount over against his former partner.

Dyer answered the petition of appellant with a general denial and a verified plea denying the execution of the note or chattel mortgage sued upon, denying that either was executed for him as a partner or otherwise, alleging that the note sued upon evidenced the individual debt of Woodside and wife to appellant, that the same was not a partnership debt and that the tractors and machinery described in the mortgage securing the payment of the note did not belong to Woodside and wife or to the partnership at the time when the mortgage was signed by Woodside and wife, such tractors and machinery belonging to and being in the possession of Waco Farm Machinery Company at that time, and that the Waco Farm Machinery Company continued thereafter to be the owner of such property until Dyer paid to the latter company from his own personal funds the purchase price thereof.

The case was tried before a jury but upon the conclusion of the evidence appellant and Dyer each moved the court for a peremptory instruction, each asserting that under the competent evidence there was no material issue of fact to be submitted to the jury. Thereupon, the court overruled the motion of appellant, sustained the motion of Dyer, withdrew the case from the jury and rendered judgment establishing appellant's debt as against Woodside, decreeing an accounting as between the partners and the partnership property, adjudging to Dyer priority of payment of all sums advanced by him to the partnership and decreeing a foreclosure of appellant's chattel mortgage lien against the property of Woodside, if any, upon the accounting. From the foregoing judgment appellant has duly perfected its appeal to this court.

Under the several points which its appeal is predicated, appellant says the court below erred in overruling its motion for a peremptory instruction and in rendering judgment in accordance with the motion of Dyer because the evidence conclusively showed that the note sued upon was executed by and for the partnership as a partnership obligation, that appellant advanced to appellees as partners the sum of $6000 which was not repaid and is still owing to appellant as a partnership debt and because, under the undisputed evidence, Dyer is estopped to deny his liability to appellant on the note and debt in suit.

The undisputed evidence shows that on or about October 13, 1947, Woodside and Dyer agreed verbally to engage as partners in the sale of Gibson Tractors under the firm name of 'Waco Gibson Tractor Sales.' Dyer put up the initial capital for the enterprise in the sum of $3500, with the understanding that Woodside would later pay for his one-half interest in the business from his part of the profits, it being understood that the partners would share equally the profits and losses arising from the undertaking. Woodside operated the business of the partnership as manager thereof until operations were suspended on May 13, 1949. On January 28, 1948, Woodside and his wife signed their names to a promissory note, payable to the order of appellant in the sum of $9000, with interest at the rate of six per cent per annum from date until paid, the note being payable 60 days after its date. On April 9, 1948, they signed another note which,...