Hall v. Brown, 4388

• Decision Date: 06 January 1966
• Docket Number: No. 4388,4388
• Citation: 398 S.W.2d 404
• Parties: E. G. HALL et al., Appellants, v. Frederick S. BROWN et al., Appellees.
• Court: Texas Court of Appeals

Page 404

398 S.W.2d 404

E. G. HALL et al., Appellants, v. Frederick S. BROWN et al., Appellees.

No. 4388.

Court of Civil Appeals of Texas, Waco.

Jan. 6, 1966.

Ed Roy Simmons, Mexia, Golden, Croley, Howell, Johnson & Mizell, Bradford D. Corrigan, Jr., J. Ralph Howell, Jr., Dallas, for appellants.

Carl Cannon, Bradley & Geren, Groesbeck, for appellees.

WILSON, Justice.

Plaintiffs Brown and others sued defendants Hall and others seeking to recover title to and possession of gas pipelines, to establish a constructive trust upon the rights of the purchaser under a gas purchase contract, to recover damages for loss of use of gas produced and sold under that contract, and to obtain other relief. Judgment was rendered in favor of plaintiffs on a jury verdict dict for most of the relief sought. Descendants of C. L. Brown, deceased, who are beneficiaries under his will, with their spouses, are the parties. The wife of appellant Hall, daughter of Brown, is independent executrix of the latter's estate. The evidence shows Hall acted for his wife in the management of estate properties.

The petition alleged that Hall managed the estate properties and carried on enterprises in which Brown had been engaged, including management of oil, gas and pipeline interests. In December, 1962, as was pleaded, plaintiffs and defendants entered into a contract by which plaintiffs purchased and defendants sold the 60% interest of the latter in various properties of the estate for $240,000. Plaintiffs had been tendered the option of buying or selling on this basis. It was alleged the property purchased by them included specified pipe lines and the proceeds of sale of a drilling rig, which were not delivered; that Hall originally obtained from the Humble companies a gas contract on behalf of the estate, permitted it to be cancelled, and then acquired it in his own name. They prayed judgment for the 'fair market value of all the natural gas taken from said well by defendants at a price of 27 1/2 cents per thousand cubic feet.' It was averred that it was falsely represented that the proceeds of the sale of the drilling rig had been included cluded in assets purchased, but that defendants later claimed the proceeds constituted fourth quarter operating profits; that plaintiffs acted under a mistake of fact as to ownership of the pipelines; that defendants falsely represented these belonged to themselves, rather than to the estate, and it was sought to impose a constructive trust thereon. Defendants pleaded that the statement of estate profits for distribution for the fourth quarter of 1962 was prepared in accordance with the 1962 contract of purchase and sale, i. e., as had been done in the past, and according to accepted accounting principles.

Plaintiffs pleaded that they were minors during the period involved; that the estate properties were operated by Hall 'as a fiduciary for plaintiffs'; that they were induced to execute a pleaded release of all claims against the estate and the executrix by fraud and misrepresentation.

Notwithstanding plaintiffs' trial pleadings consume 35 transcript pages and the evidence exceeds 1000 pages, only six issues were submitted. To these the jury answered in effect: (1), (2) and (3) that at the time of signing the contract of purchase and sale specified portions of the pipelines in question 'belonged to the estate of C. L. Brown, deceased'; (5) that when he negotiated the Humble gas contract Hall 'stood in the relation of fiduciary toward the plaintiffs'; (6) that Hall 'took unfair advantage' of the relationship in the Humble transaction. To issue 4, inquiring whether the statement of profits for distribution for the fourth quarter of 1962 'was prepared in accordance with' the sale contract, the jury answered, 'No.' No objections to the charge are presented.

We sustain appellants' points presenting contentions now to be discussed, and overrule the others.

Recovery under the Humble gas contract, and the pipeline and welding machine claims are barred by the pleaded written release executed by plaintiffs as a part of the contract of purchase and sale, it is contended by appellants. That contract consummated negotiations by which plaintiffs were afforded a choice of buying defendants' interests or selling their own in the estate properties on a fixed-price basis. They elected to buy, executing the release in which they acknowledged they had examined the books and records of the estate and the executrix. Although it was alleged plaintiffs were induced to execute the release by fraud, no issue relating to this allegation was submitted or requested. The judgment does not purport to set aside or reform the release or the contract of sale and purchase. Under Rule 279, Texas Rules of Civil Procedure, since no issue on this independent ground of recovery was submitted or requested, it was waived. Clark v. National Life & Acc. Ins. Co., 145 Tex. 575, 200 S.W.2d 820; Dial Temp Air Conditioning Co. v. Faulhaber, Tex.Civ.App., 340 S.W.2d 82, writ ref. n. r. e.; Reed v. Beheler, Tex.Civ.App., 198 S.W.2d 625.

Plaintiffs pleaded that under the Humble gas purchase contract Hall acquired 168,110 MCF of gas at a rate of eleven cents for his own account and use, but it could have been re-sold (or used by the estate) for 27 1/2 cents per MCF, alleged to be its fair market value, and plaintiffs thereby lost $27,738.15. Although the relief sought is intermingled in the pleading so that it is difficult to ascertain the theory ultimately relied on, plaintiffs prayed (1) that the Humble contract be assigned and awarded to them, (2) that a trust be imposed on the contract, or (3) that they recover judgment for damages. No issue was submitted or requested as to the market value of the gas. The charge contains no damages issue.

It is sought to justify the omission by the contention the damages are...