Johnson v. Karam, 6146

• Decision Date: 07 April 1971
• Docket Number: No. 6146,6146
• Citation: 466 S.W.2d 806
• Parties: Paul O. JOHNSON et al., Appellants, v. W. F. KARAM et al., Appellees.
• Court: Texas Court of Appeals

Page 806

466 S.W.2d 806

Paul O. JOHNSON et al., Appellants, v. W. F. KARAM et al., Appellees.

No. 6146.

Court of Civil Appeals of Texas,

El Paso.

April 7, 1971.

Rehearing Denied May 5, 1971.

Fred J. Morton, Mark F. Howell, El Paso, for appellants.

Long & Koehler, Harold S. Long, Newman & Newman, Tom B. Newman, Jr ., El Paso, for appellees.

OPINION

RAMSEY, Chief Justice.

This cause of action was filed by W. F. Karam and Jack Perl and wife, Billie Perl, as plaintiffs, against Paul O. Johnson and wife, Geneva Ann Johnson, and others, as defendants, in trespass to try title and to cancel contracts affecting title to property in El Paso . Defendants Johnson filed a cross action for specific performance and damages against plaintiffs, and a third-party petition against Pauline Ablon for declaratory judgment, rescission of a contract and for possession of the premises. The third-party defendant, Ablon, filed a cross action against the defendants Johnson and against plaintiffs Karam and Perl for damages.

At the conclusion of the trial, the court withdrew the case from the jury and entered judgment, as a matter of law, for the plaintiffs and denied any recovery to defendants on their cross action and third-party action, and denied the third party's cross action for damages against the defendants and plaintiffs. Defendants Johnson and cross-defendant Ablon have perfected their appeals. The parties will be referred to by their surnames for simplicity.

On July 24, 1965, Karam and Perl entered into an agreement with Johnson for the sale of the Sahara Motor Inn at El Paso. Johnson was to assume a first lien mortgage of approximately $375,000.00 and to assign a first lien mortgage note on Nebraska property with a balance of approximately $145,000.00 and to assume other bank mortgages on the fixtures. In addition, he executed a $70,000.00 note which was payable $1,000.00 per month, to commence February 24, 1966. The instruments were executed, including a deed to Johnson, and held in escrow by an El Paso title company, and were to be delivered to Johnson at such time as Karam and Perl were satisfied with title to the Nebraska property. This first agreement was amended the following day, July 25, 1965, by an agreement providing that Johnson was to have possession of the motel, and that the monies received from its operation were to be held in escrow, less expenses and lien payments, until such time as the instruments were delivered conveying title. The amendment also provided that if the transaction was not completed in sixty days, possession would be returned to Karam and Perl, and if title to the Nebraska property could not be perfected in sixty days, the agreement was to be of no further force or effect. Johnson took possession, assigned the Nebraska note 'without recourse', and undertook to operate the motel, paying the lien payments and making some seven payments on the $70,000.00 note. An attorney's opinion on the Nebraska property revealed delinquent taxes of approximately $6,800.00, relegating the mortgage securing the $145,000.00 note subordinate and secondary to the tax lien.

On September 20, 1965, Johnson executed a sworn statement that tax receipts would be delivered six months and fifteen days later on the Nebraska property. On February 1, 1966 Karam and Johnson signed another agreement (not signed by Perl) relating to closing provisions. On October 13, 1966 still another agreement was executed by Karam and Johnson (Perl did not sign), ratifying all prior agreements and providing that Johnson could execute a 30-day promissory note for the Nebraska taxes. Johnson executed the note and it was held in escrow. Perl refused to sign both subsequent agreements. Johnson never paid the delinquent taxes.

On October 2, 1966, Johnson entered into an agreement with Ablon for the sale of the motel. The transaction between Karam, Perl and Johnson still was not closed. The total consideration was $1,005,000.00. Ablon conveyed some property in Florida to Johnson, executed a $233,000.00 note, and agreed to assume the indebtedness on the motel. This transaction was without the knowledge of Karam or Perl. The agreement provided that time was of the essence, stating:

'This transaction shall be closed on or about the 20th day of October, 1966, unless delayed by title defects.'

On October 17, 1966 Ablon went into possession and remained until the time of trial in March, 1970. Prior to the expiration of thirty days from October 13, 1966, Karam and Perl learned of Mrs. Ablon's operation of the motel. Apparently, Karam and Perl acquiesced in Ablon's operation of the motel.

On January 31, 1967, lien payments on the motel were in arrears. Karam and Perl then executed an agreement with Ablon agreeing to sell her the motel for $750,000.00 in the event they recovered title and possession from Johnson. The agreement provided that Ablon should pay all notes current, plus operating costs and, if Ablon defaulted, the contract could be canceled and Karam could retain all monies paid as liquidated damages. The agreement provided no time stipulation for Karam and Perl to do anything, though Ablon testified that her attorney assured her that it would be included. Ablon was represented by an attorney in all her transactions. The evidence shows that from October 17, 1966 through the year 1969, Ablon's payments and expenses exceeded her income from the property by approximately $128,000.00, and that when her financial resources were exhausted, she failed to make the payments after October, 1969 and became in default. After her default, Karam and Perl joined Ablon as a party defendant seeking cancellation of their contract with her and for title and possession.

Appellant Johnson assigns five points of error. Appellees Karam and Perl challenge Points One and Two as being multifarious, general and indefinite and not in compliance with Rules 321, 322 and 374, Texas Rules of Civil Procedure. This same objection is made to appellant Ablon's points One and Two. With appellees' contention we are inclined to agree; yet the appellate courts of this state are prone to consider the points if, from their presentation, the error complained of can be ascertained with some degree of certainty. Keystone-Fleming Transport v. City of Tahoka, 315 S.W.2d 656 (ref. n .r.e.). For this reason this court will entertain these points of error.

The correct rules governing the appellate court in considering cases withdrawn from the jury require this court to view the evidence in the light most favorable to the losing party, and to indulge against the instruction every inference that may be properly drawn from the evidence. Dunagan v. Bushey, 152 Tex . 630, 263 S.W.2d 148 (1953). If the evidence is conflicting, the jury must decide the conflict; and if the evidence is not conflicting, but reasonable minds might differ as to its effect, still a fact issue is presented. Le Master v. Fort Worth Transit Co ., 138 Tex. 512, 160 S.W.2d 224 (1942). If there are issues to be submitted to the jury, Rule 277, Texas Rules of Civil Procedure, requires that the court 'shall submit the cause upon special issues raised by the written pleadings and the evidence in the case.'

In considering appellant Johnson's Points 1 and 2, the relationship of Karam and Perl is quite important, since most of the negotiations were conducted by Karam. Karam and Perl received their interest ownerships from different sources. There are no allegations in the pleadings as to a co-partnership existing between them, and no allegation that one was the agent of the other, with...