Groos v. Brewster

• Decision Date: 31 January 1900
• Citation: 55 S.W. 590
• Parties: GROOS et al. v. BREWSTER.<SMALL><SUP>1</SUP></SMALL>
• Court: Texas Court of Appeals

55 S.W. 590

GROOS et al. v. BREWSTER.¹

Court of Civil Appeals of Texas.

January 31, 1900.

Appeal from district court, Webb county; A. L. McLane, Judge.

Action by C. G. Brewster against F. Groos & Co., the Milmo National Bank, and the J. L. S. Hunt Company to recover on drafts. From a judgment in favor of plaintiff against F. Groos & Co. and the J. L. S. Hunt Company, defendants F. Groos & Co. appeal. On rehearing. Former opinion withdrawn. Reversed.

E. A. Atlee, for appellants. Dodd & Mullaly, for appellee.

On Motion for Rehearing by F. Groos & Co.

JAMES, C. J.

This motion is granted, in view of the case of Bowen v. Bank, 36 C. C. A. 553, 94 Fed. 925. The principle in that case is that a national bank has no power to lend its credit to any person, or to become a guarantor of the obligation of another, except in the ordinary course of banking; and such an act is not binding on the bank by estoppel, unless it has received benefits therefrom. See, also, Thilmany v. Paper-Bag Co. (Iowa) 79 N. W. 68; Bank v. Pirie, 27 C. C. A. 171, 82 Fed. 799; Bank v. Smith, 23 C. C. A. 80, 77 Fed. 129. In our former decision we held that the petition alleged, and the evidence of plaintiff tended to prove, a case against the Milmo National Bank, as well as against F. Groos & Co., in respect to the indebtedness claimed, and that therefore the action was properly brought against both parties in Webb county, the domicile of the Milmo National Bank. Mathonican v. Scott, 87 Tex. 398, 28 S. W. 1063; Railway Co. v. Mangum, 68 Tex. 346, 4 S. W. 617. But the rule declared in the cases first above cited was not considered. The petition alleged that the defendants F. Groos & Co. resided in Bexar county; and the latter pleaded in limine to the jurisdiction of the court over them, claiming their privilege to be sued in the county of their residence, and alleging that the Milmo Bank was joined for the purpose of conferring jurisdiction in fraud of defendant's privilege. There was no contract by its terms performable in Webb county, and the fact that the Milmo National Bank might have been a proper co-defendant constituted, in our opinion, the sole ground for jurisdiction over appellants. There was also a demurrer by appellants, claiming that the want of jurisdiction over them appeared from the pleadings of plaintiffs. This was acted upon, and overruled, and excepted to; but we need not specially discuss this ruling, for the case went to trial and was fully developed, and we may dispose of the jurisdictional question raised by the plea with reference to the case made by the evidence. Watson v. Baker, 67 Tex. 48, 2 S. W. 375.

In substance, the evidence was as follows: F. Groos & Co., bankers at San Antonio, sent to the Milmo National Bank, at Laredo, 31 drafts, with corresponding bills of lading, drawn by the J. L. S. Hunt Company on plaintiff, Brewster, for that many cars of corn that had been shipped by the Hunt Company to Brewster, at Laredo. Brewster had not purchased the corn, nor agreed to do so. He was a commission merchant, and handled corn for the Hunt Company. F. Groos & Co. owned all the drafts except 6, having purchased them outright from the Hunt Company. The other 6 they had taken for collection for the Hunt Company. A letter of instructions sent with the drafts stated: "Bill, bill of lading, and other papers attached to each draft to be delivered only on payment of each respective draft." Each draft mentioned the number of the car containing the corn to cover which it was drawn. On May 27th they wrote the Milmo National Bank: "San Antonio, Texas, May 27, 1897. Milmo National Bank, Laredo, Texas — Dear Sir: A number of cars of corn, covered by bills of lading attached to drafts on C. G. Brewster, sent you at various times, have been sold at a reduced price from original figures; and in paying for such drafts Mr. Brewster is to draw on the J. L. S. Hunt Co. for the difference of value of corn, which said drafts you are hereby authorized to accept as part payment of such collections. Respectfully, F. Groos & Co." The occasion for writing, and the purpose of said letter, are shown by the testimony of defendant's cashier: "Later, prior to May 27, 1897, Hunt had been to Laredo, and come back and reported to us that the corn was standing on the track, and would have to be sold for less than billed prices, and that it was in bad condition, or likely to become so; and his statement of such facts caused us to write the letter of May 27, 1897. When writing this letter, we were not under the impression that any of the cars in question had been sold for less money than the amounts drawn for; and our letter was to authorize such sales, and to authorize returns as therein indicated." Brewster had refused to pay the drafts and take the corn when the former were presented to him by the Milmo Bank, on account of its condition, and his inability to sell for the billed prices. But when the letter of May 27th came, and was shown him, it appears that both he and the Milmo Bank construed it to mean that F. Groos & Co. wanted to get their money out of the corn, and that they would stand the difference in value, and were more concerned in getting what money they could out of the corn, than the particular manner in which remittances should reach them. In other words, they construed the letter to authorize the arrangement which the Milmo National Bank then made with Brewster, viz. that Brewster would pay the drafts in full, and afterwards,...