McDonough v. Zamora

• Decision Date: 20 July 1960
• Docket Number: No. 13617,13617
• Citation: 338 S.W.2d 507
• Parties: John Kirby McDONOUGH et al., Appellants, v. Pedro Fox ZAMORA, Appellee.
• Court: Texas Court of Appeals

Page 507

338 S.W.2d 507

John Kirby McDONOUGH et al., Appellants, v. Pedro Fox ZAMORA, Appellee.

No. 13617.

Court of Civil Appeals of Texas, San Antonio.

July 20, 1960.

Rehearing Denied Aug. 31, 1960.

Rosenfield, Berwald & Mittenthal, Strasburger, Price, Kelton, Miller & Martin, Ryal H. Brin, Jr., Dallas, for appellants.

Edwards & Flannigan, Turner, White, Atwood, McLane & Francis, L. Ray Pearce, Dallas, for appellee.

POPE, Justice.

Pedro Fox Zamora sued John Kirby McDonough and recovered judgment for $64,000 actual damages, plus interest, for two checks executed by McDonough in January, 1954, on which McDonough stopped payment. Zamora also sued Charles D. West for aiding and abetting McDonough in defrauding him out of the $64,000, but that phase of the suit was abandoned. However, West cross-acted against Zamora for damages he claims he sustained as a result of an assault and battery by Zamora's agents. The trial court sustained Zamora's motion for instructed verdict and West has appealed from that judgment. We, therefore, have two actions, the one by Zamora against McDonough which McDonough has appealed, and the one by West against Zamora which West has appealed.

Zamora v. McDonough

McDonough's points urge that the trial court erred in rendering judgment against him, because (1) his 1954 checks for $24,000 and $40,000 were tainted with the illegality of gambling; (2) the court improperly excluded transcriptions of conversations in 1957 between West and Zamora's attorneys; (3) the court improperly admitted testimony that Zamora during 1953 cashed checks for McDonough which he paid, and (4) plaintiff's attorneys engaged in improper jury argument. By cross-assignment, Zamora complains of the trial court's order requiring him to remit $32,000 exemplary damages, which the jury had found.

Plaintiff, Zamora, obtained favorable findings on all issues necessary to the proof of his claim on the checks. The jury found that (1) McDonough signed and delivered to Zamora the check in the amount of $24,000, (2) upon McDonough's signing and delivering such checks, Zamora paid McDonough the sum of $24,000, (3) on January 18, 1954, McDonough signed and delivered to Zamora a check in the amount of $40,000, (4) at that time, Zamora paid McDonough the sum of $40,000, (5) at the time McDonough delivered the checks to Zamora, he then intended to stop payment on them, (6) and McDonough should be required to pay $32,000 as exemplary damages. On motion for new trial, the court ordered a remittitur of the punitive damages and rendered judgment for $64,000 and interest.

Defendant McDonough urged two defenses--that he executed the checks under duress and that they were for illegal transactions. The jury answered these defensive issues against McDonough. McDonough does not complain of the finding that the checks were not executed under duress. On January 15, 1954, McDonough flew from New Orleans to Havana for a brief pleasure trip. When he arrived in Havana, instead of going directly to the Sevilla-Biltmore Hotel where he had a reservation, he went to the Tropicana Club to dine and see the late show. The Tropicana is an elaborate casino, owned by Zamora, Oscar Echemendia, and two others. McDonough said that he gambled and lost 'as usual' but cashed no checks. After two and one-half hours he left the club in company with Oscar Echemendia whom he knew from former visits in Havana. They went to a cafe and then McDonough went to his hotel. He testified that the next night, Saturday, January 16, he returned to the Tropicana where he said he again gambled and lost. On Sunday night, January 17, according to McDonough, in company with another man, he visited the Sans Souci Night Club. He testified that he did not gamble, but while he was in the gaming room he was invited to the manager's office and was coerced into signing four or five large checks drawn on the First National Bank of Dallas. In the record, in addition to the two checks in suit, are four checks totalling $101,000 payable to cash, executed by McDonough on January 17, 1954. McDonough ordered payment stopped on all checks including the two involved in this suit.

The issue on illegality inquired whether Zamora's purpose in cashing the two checks was to provide McDonough with funds to gamble in the Tropicana Club, Zamora's establishment. The only matters preserved are whether there is evidence and sufficient evidence to support the issues as submitted.

Without attempting to state all of the evidence in this large record, but applying the correct rule, there was evidence, and the findings were not against the great weight of the evidence. Zamora testified that he knew McDonough from previous visits at the Tropicana. Other evidence showed that McDonough and Oscar Echemendia, one of Tropicana's owners, were good friends. Zamora testified that he saw McDonough on the night of January 15, 1954, when he was at Tropicana, even before he checked into the hotel. He testified several times during a full cross-examination, that on the afternoon of Saturday, January 16, McDonough phoned and asked him to come to the Sevilla-Biltomore Hotel to cash a check for him. Zamora discussed the matter with his partners and then went to the hotel. From the lobby he phoned McDonough to meet him in the lobby, which McDonough did, and there he delivered McDonough $24,000 in cash when McDonough handed him the check in that amount. He testified that he did the same thing on January 18, with respect to the additional $40,000. Where, how, or if the funds were spent is disputed. There was no discussion between Zamora and McDonough about gambling, using the funds for gambling at Tropicana, Sans Souci Night Club, or elsewhere. In fact, McDonough testified that he went to Sans Souci Night Club, and to its gambling room, on Sunday, January 17, and not to Tropicana.

McDonough pieces together fragments of Zamora's lengthy testimony as judicial admissions of fact which contradict the jury finding. McDonough relies upon statements by Zamora that he knew McDonough was well known all over the world as a gambler, that he did not know where McDonough lost his money, and that one of the reasons he gave him 'facilities' was that he knew he was a big gambler and might come and play his place. However, Zamora also testified, 'We don't take checks for gambling obligations. We cash you the check, give you the money, and you do with it whatever you want.' He said he didn't care what McDonough did with the money. This evidence at most shows that Zamora hoped that McDonough would gamble at Tropicana with the funds, but the transaction was one of cashing a check and providing McDonough with funds which he could use as he wished.

Zamora's testimony shows only that he made scattered statements which might be inconsistent with other statements. The statements, however, are not the clear, deliberate and unequivocal ones required to constitute a judicial admission. Instead there were explanations, modifications, and at most inconsistencies in his testimony. See Griffin v. Superior Insurance Co., Tex., 338 S.W.2d 415; United States Fidelity & Guaranty Co. v. Carr, Tex.Civ.App., 242 S.W.2d 224.

McDonough himself has provided strong support for the jury finding. His evidence was that he did not need funds from the cashed checks for his gambling, and that he used only his pocket money and Travelers Checks for his gambling. ¹ While it is true that he offered this evidence in connection with his now-abandoned defense of duress, he stated the facts without limitation as he remembered them. McDonough is in the awkward position that in testifying about duress he helped defeat his other defense of illegality. From the evidence, the jury could have inferred that Zamora cashed the checks as a mere accommodation for a former friend and wealthy patron, or, as McDonough urged during the trial, that it was not for gambling at all, but if so that it was for gambling, not at Tropicana but at San Souci or elsewhere.

Knowledge that money furnished 'might be used in an illegal enterprise would not of itself, without other act in aid or in furtherance thereof, defeat the right to recover.' Lewis v. Alexander, 51 Tex. 578; Shelton v. Marshall, 16 Tex. 344, 360; Kottwitz v. Alexander's Representatives, 34 Tex. 689; Lewis v. Alexander's Executors, 34 Tex. 608; Oliphant v. Markham, 79 Tex. 543, 15 S.W. 569; Perkins v. Nevill, Tex.Com.App., 58 S.W.2d 50; Cleveland v. Taylor, 49 Tex.Civ.App., 496, 108 S.W. 1037; 6 Williston on Contracts, Sec. 1681. Certainly, it was not proved as a matter of law that Zamora, through Tropicana, was a participant in any illegality Springer v. Sahara Casinos Co., Tex.Civ.App., 322 S.W.2d 33; Seibert v. Sally, Tex.Civ.App., 238 S.W.2d 266; Sanger v. Futch, Tex.Civ.App., 208 S.W. 681; 38 C.J.S. Gaming Sec. 26.

McDonough complains of the court's exclusion of a transcription of a telephone conversation between counsel for Zamora and Charles D. West on January 23, 1957, and a later transcription of a conference between several of Zamora's Cuban and American attorneys, West and McDonough's attorney. McDonough offered the transcriptions to show prior inconsistent statements. These discussions occurred three years after the events in Cuba, between persons who were not present when the events sued upon occurred, and, as the trial judge stated, were 'lawyer talk.' They were not statements of the parties but relate to a statement of the claims and defenses of the lawyers and their ideas about the law. There were discussions of possible criminal charges in Cuba which would embarrass McDonough throughout Latin America. Included in the transcription is West's conversation with some unknown person who phoned during the conference. They discussed the recent invasion of Cuba from Mexico, a bombing in the Nacional Hotel, which killed scores of people, politics, the Cuban army, the murder of the Chief of Police and of students who had...