Kirby v. Fitzgerald, 1922-6490.

• Decision Date: 15 January 1936
• Docket Number: No. 1922-6490.,1922-6490.
• Citation: 89 S.W.2d 408
• Parties: KIRBY et al. v. FITZGERALD et al.
• Court: Texas Supreme Court

89 S.W.2d 408

KIRBY et al. v. FITZGERALD et al.

No. 1922-6490.

Commission of Appeals of Texas, Section A.

January 15, 1936.

Error to Court of Civil Appeals of Eighth Supreme Judicial District.

Suit by Miss Grace Fitzgerald, as trustee in bankruptcy of the Collin County Realty Company, and others against John H. Kirby, O. S. Carlton, and others. Judgment against the named defendants was reversed and remanded for new trial by Court of Civil Appeals [57 S.W.(2d) 362], and such defendants and the named plaintiff bring error.

Judgment of Court of Civil Appeals affirmed.

Andrews, Streetman, Logue & Mobley and E. J. Fountain, Jr., all of Houston, for plaintiffs in error.

Bullington, Humphrey & King, of Wichita Falls, and McCormick, Bromberg, Leftwich & Carrington, Jed C. Adams, Rosser J. Coke, I. M. Williams, and W. L. Thornton, all of Dallas, for defendants in error.

HICKMAN, Commissioner.

In the trial court Miss Grace Fitzgerald, as trustee in bankruptcy of Collin County Realty Company, a corporation, recovered judgment against John H. Kirby, O. S. Carlton, and S. W. Sibley, for $381,844.74, besides interest and costs. There were other parties defendant in the trial court, but judgment ran in their favor. Kirby and Carlton prosecuted an appeal to the Court of Civil Appeals, and Miss Fitzgerald appealed from that portion of the judgment denying her recovery against Dr. Pepper Company, a corporation. Later a settlement was made between her and Dr. Pepper Company, and that phase of the case is not before us for review. The Court of Civil Appeals reversed the judgment against Kirby and Carlton and remanded the cause to the trial court. 57 S.W.(2d) 362. The application of Kirby and Carlton for writ of error was granted on an assignment presenting the question that judgment should have been rendered in their favor. The application of Miss Fitzgerald was granted because of the granting of the other application.

The record is a voluminous one, and the facts with reference to all of the dealings and transactions between the parties are involved and complicated, but the following condensed statement will serve the purpose of this opinion: Collin County Realty Company, in which S. W. Sibley was the principal stockholder, owned a large number of shares of the capital stock of Dr. Pepper Company, a corporation. Sibley delivered this stock to Carlton as collateral security for his personal note to him. This note was assigned to Kirby, and he was awarded judgment against Sibley thereon, together with a foreclosure of his lien on the Dr. Pepper stock. Just prior to the date this stock was to be sold under the foreclosure decree, Collin County Realty Company was adjudged a bankrupt and Miss Grace Fitzgerald appointed receiver. She immediately filed in the federal District Court at Houston an application for a temporary restraining order for the purpose of having the sale of this stock postponed until the creditors of the bankrupt could select a trustee and that trustee could determine what steps to take to protect the interest of the bankrupt estate. The relief prayed for was granted to the extent that the sale was postponed one month. At the expiration of that time, the order of sale was duly executed and Kirby became the purchaser of the stock. Thereafter Miss Fitzgerald, who in the meantime had been named as trustee of the bankrupt estate, instituted the present suit, praying for the title and possession of the Dr. Pepper stock and, in the alternative, in the event defendants had placed said stock beyond their control, for the value thereof. Judgment ran in her favor against Kirby, Carlton, and Sibley in the amount above stated.

We first dispose of the assignments of Miss Fitzgerald presenting the question that the Court of Civil Appeals should have affirmed the judgment of the trial court.

A reversal was ordered because of the insufficiency of the verdict to sustain the judgment. The twenty-seven issues submitted to the jury are set out in the opinion of the Court of Civil Appeals. A consideration of these issues, together with the answers of the jury thereto, has convinced us that no judgment could properly be rendered thereon in favor of either party, for two reasons: First, the jury was unable to return answers to certain material issues; second, the answers returned to other material issues are in irreconcilable conflict.

In special issue No. 5 inquiry was made as to whether Sibley delivered the stock in question in pledge to Carlton and Kirby with the knowledge and consent of the officers of Collin County Realty Company having authority to consent thereto. No answer was returned to this issue. This was a very material issue, for, if such officers acquiesced in this action, the company would be bound and the trustee would not be entitled to recover.

Special issue No. 17 inquired as to whether the transfer agent of Dr. Pepper Company was given authority by the board of directors of Collin County Realty Company to transfer the stock from the name of Carlton, trustee, to Kirby and Carlton. An affirmative answer to this issue would have established a ratification of the entire transaction by the company. Obviously that issue was material.

There is irreconcilable conflict in the answers of the jury to issues Nos. 11 and 12. In answer to issue No. 11, the jury found that, from the time when the stock certificates in question were delivered to him, John H. Kirby did...