McFaull v. Collins

• Decision Date: 21 January 1948
• Docket Number: No. 9687.,9687.
• Citation: 208 S.W.2d 142
• Parties: McFAULL v. COLLINS.
• Court: Texas Court of Appeals

208 S.W.2d 142

McFAULL v. COLLINS.

No. 9687.

Court of Civil Appeals of Texas. Austin.

January 21, 1948.

Rehearing Denied February 4, 1948.

Appeal from District Court, Williamson County; D. W. Wilcox, Judge.

Action by H. L. Collins against Clarence McFaull to recover the value of services performed by plaintiff under his contract of employment with defendant. From a judgment for the plaintiff, the defendant appeals.

Judgment affirmed.

Olga H. Lapin, of Kilgore, Wood & Wilcox, of Georgetown, and Wynne & Wynne and Philip Brin, all of Longview, for appellant.

Woodville J. Rogers, of San Antonio, for appellee.

HUGHES, Justice.

Appellant, Clarence McFaull, owned the patent for a machine invented by Kirk Knight for use in cutting down trees in a scissor-like manner.

On November 29, 1945, appellant entered into a contract with appellee, H. L. Collins, under which appellee was made general manager of the Giant Tree Shears Company (the name under which appellant operated) for a period of one year, appellee to devote all of the time necessary for the proper management and supervision of such company. As to appellee's compensation, the contract provided: "In consideration of the services rendered by Collins he shall be paid 33 1/3 % of all net profits of the Company made during the term of this Contract monthly as they accrue whether such profits be derived from the sale of machines and equipment in the United States or foreign countries. It is understood that in consideration of the services of Collins that he will receive 33 1/3 % of the net profits derived from the sale of patents, or patents pending, which may pertain to the Tree Shears or similar equipment, if McFaull should sell any of these patents, or patents pending, within one year from the date of this Contract."

In March 1946, appellee was wrongfully discharged by appellant and brought this suit to recover the value of his services performed under the contract.

The contract made no provision for calculating the damage to either party in event of its breach.

It is undisputed that no profits accrued from the enterprise during the year covered by the contract.

Trial was without a jury and judgment was rendered against appellant for $6,200. No findings of fact nor conclusions of law were requested or filed.

Appellant predicates his appeal upon two Points: (1) The trial court erred in awarding recovery for the value of appellee's services since they were of no benefit to appellant; and (2) the trial court erred in awarding recovery upon quantum meruit, for the reason that the contract stipulated the compensation to be paid.

The second point is not well taken.

In Carroll v. Welch, 26 Tex. 147, the measure of damages to be applied here is included in the following excerpt from that case: "According to the modern decisions and the decisions of this court, the rule appears to be, that if the employee abandons his contract the employer shall be charged with only the reasonable worth, or the amount of benefit he has received upon the whole transaction, and in estimating the amount, the contract price cannot be exceeded. The former is allowed to recover for his part performance, its reasonable worth, not to exceed the contract price, and the latter to recoup or reconvene his damages for the breach of contract by the former. Where the employee is discharged without cause, or is prevented by the employer from completing the performance, he is entitled to recover for the part performed, and the damages he has sustained by reason of the breach of contract, by the employer. If both parties have broken the contract or there has been a mutual abandonment of it by both parties, the employee is entitled to recover the reasonable worth of the services he has rendered the employer."

In Devoe v. Stewart, 32 Tex. 712, the parties made an agreement by which plaintiff was to furnish his service and defendant was to furnish machinery, etc., for the purpose of sinking oil wells on Padre Island. Compensation for the parties was to be in the proceeds or profits. After plaintiff had labored for five months defendant defaulted and plaintiff brought suit for the value of his services. In allowing a recovery the court said: "It is further insisted that this was not a proper case for attachment; the parties having entered into a special agreement, by which a special compensation was provided for plaintiff's services, none other could be resorted to, and plaintiff could not recover upon a quantum meruit. This rule would obtain in the absence of any breach by the defendants, of their contract; but not otherwise."

For an interesting historical note on this question see 5 Texas Law Review, 225. See also 45 Tex.Jur., 326; Matson v. Stewart, Tex.Civ.App., 124 S.W. 736; and Colbert v. Dallas Joint Stock Land Bank, 129 Tex. 235, 102 S.W.2d 103.

Appellant relies upon City of Wichita Falls v. Long, Tex.Civ.App., 167 S.W.2d 792, which states the general rule that no recovery upon a quantum meruit can be allowed under an express contract which fixes the compensation for services rendered. No question of wrongful termination of an entire contract was involved in that case and hence it has no application here.

Travis v. Kennedy, Tex.Civ.App., 66 S. W.2d 444...