Hopkins v. First Nat. Bank at Brownsville, 1112

• Decision Date: 30 December 1976
• Docket Number: No. 1112,1112
• Citation: 546 S.W.2d 84
• Parties: Burtram C. HOPKINS, II, Appellant, v. FIRST NATIONAL BANK AT BROWNSVILLE, Texas, Appellee.
• Court: Texas Court of Appeals

Page 84

546 S.W.2d 84

Burtram C. HOPKINS, II, Appellant, v. FIRST NATIONAL BANK AT BROWNSVILLE, Texas, Appellee.

No. 1112.

Court of Civil Appeals of Texas,

Corpus Christi.

Dec. 30, 1976.

Rehearing Denied Feb. 17, 1977.

Steven W. Stark, Cox, Wilson, Black & Stark, Brownsville, Daniel Miller, Dallas, for appellant.

C. Fount Ray, Ransome & Ray, Brownsville, for appellee.

OPINION

BISSETT, Justice.

This is a venue case involving subdivision 5(a) of Tex.Rev.Civ.Stat.Ann. art. 1995 (Supp.1976). The First National Bank of Brownsville, Texas, instituted suit against Southwestern Dynamics, Inc. (SDI), Thomas Woodward, Howard L. Crow, Jr., Donald Kerr and Burtram C. Hopkins, II. Plaintiff, a national banking association, sued SDI when it allegedly defaulted upon a note. Woodward, Crow, Kerr and Hopkins were sued upon a contract of guaranty which they executed and guaranteed the payment of the indebtedness of SDI.

Defendant Hopkins filed a plea of privilege to be sued in Dallas County, the county of his residence. Plaintiff filed a controverting plea. The trial court overruled the plea of privilege and defendant Hopkins appeals.

On October 1, 1974, SDI executed a note for $37,500 payable to plaintiff Bank which provided in part:

'For value received, I, we . . . promise to pay to the order of FIRST NATIONAL BANK AT BROWNSVILLE, at its banking house in Brownsville, Cameron County, Texas, the sum of THIRTY SEVEN THOUSAND FIVE HUNDRED AND 00/100 . . ..

This note is secured by Guaranty of . . . Burtram C. Hopkins II.'

The president of plaintiff bank testified that the note sued upon was merely in renewal of the balance due on October 1, 1974 of an original note which was executed at or about the time of the execution of the guaranty contract on January 22, 1974. The contract of guaranty, in part, provided:

'FOR VALUE RECEIVED and in consideration of any loan or other financial accommodation heretofore or hereafter at any time made or granted to Southwestern Dynamics, Inc. (the 'Debtor') by First National Bank at Brownsville, Texas, (hereinafter, together with its successors and assigns, called the 'Bank'), the undersigned (the 'Guarantor') hereby unconditionally guarantees the full and prompt payment when due, whether by acceleration or otherwise, and at all times thereafter, of all obligations of the Debtor to the Bank, howsoever created, arising or evidenced, whether direct or indirect, absolute or contingent, or now or hereafter existing, or due or to become due (all such obligations being hereinafter collectively called the 'Liabilities'), and the Guarantor further agrees to pay all expenses (including attorneys' fees and legal expenses) paid or incurred by the Bank in endeavoring to collect the Liabilities, or any part thereof, and in enforcing this guaranty. The right of recovery against the Guarantor is, however, limited to the amount of Fifty thousand and no/100 Dollars ($50,000.00) plus interest on such amount and plus all expenses of enforcing this guaranty.'

The contract of guaranty further provided: the guaranty 'shall be a continuing, absolute and unconditional guaranty', and the Bank 'may, from time to time, without notice to Guarantor . . . extend or renew for any period (whether or not longer than the original period), alter or exchange any of the Liabilities'.

The Bank president further testified that the original note represented a line of credit that Southwestern Dynamics had with the Bank which totalled $37,500 on October 1, 1974 when the renewal note was executed. The loan made on the original note would not have been made had it not been for the guaranty of defendant Hopkins and other defendants.

Subdivision 5(a) of Tex.Rev.Civ.Stat.Ann. art. 1995 (Supp.1976). The general revenue statute, provides an exception to venue in the domicile of defendant when:

'. . . a person has contracted in writing to perform an obligation in a particular county, expressly naming such county, or a definite place therein, by such writing, suit upon or by reason of such obligation may be brought against him, either in such county or where the defendant has his domicile.'

Hopkins contends that Subdivision 5(a) does not apply to the suit against him since the contract on which he is sued does not, itself, Expressly name Cameron County, or a definite place therein, as the place of performance. We do not agree.

The function and office of the contract in this case was collateral to the original loan, which would not have been made had Hopkins and the other guarantors not executed the contract. Under the evidence, the contract cannot be read or considered independently of the original note, and the guarantees contained in the contract not only guaranteed the performance of current obligations of SDI, but of future obligations as well. The original note was not introduced into evidence for the reason that it was...