McPherson v. Johnson

• Decision Date: 23 December 1968
• Docket Number: No. 7895,7895
• Citation: 436 S.W.2d 930
• Parties: J. B. McPHERSON and D. R. Aylesworth, Appellants, v. Randolph JOHNSON, Appellee. . Amarillo
• Court: Texas Court of Appeals

Page 930

436 S.W.2d 930

J. B. McPHERSON and D. R. Aylesworth, Appellants, v. Randolph JOHNSON, Appellee.

No. 7895.

Court of Civil Appeals of Texas Amarillo.

Dec. 23, 1968.

Rehearing Denied Jan. 27, 1969.

Evans, Pharr, Trout & Jones, and John A. Flygare, Lubbock, for appellants.

McWhorter, Cobb & Johnson, D. Thomas Johnson, Lubbock, for appellee.

NORTHCUTT, Justice.

This is a suit brought by J. B. McPherson and D. R. Aylesworth, hereinafter referred to as appellant, against Randolph Johnson, hereinafter referred to as appellee, to recover upon a promissory note executed by Randolph Johnson and payable to O.J.M. Development Co. The note was transferredby O.J.M. Development Co. to D. R. Aylesworth without any recourse. Later McPherson secured an interest in the note but that interest is not in question here.

O.J.M. Development Co. owned an 18,000-acre tract of land in Cochran County, Texas, which it subdivided. T. R. Johnson, the brother of appellee, signed a contract to purchase approximately 700 acres of this tract on September 23, 1963. On signing the contract, T. R. Johson paid $3,516.35 and agreed to pay $7,035.40 on closing the deal. Before closing the deal T. R. Johnson sold part of the land and made a profit. The closing of all deals were to take place between December 15, 1963 and January 15, 1964. At the time of closing the cash balance required to close the T. R. Johnson sale amounted to $6,095.95. T. R. Johnson did not have the cash to close his purchase andO.J.M. Development Co. was unwilling to accept T. R. Johnson's note in lieu of cash. They were willing to take Randolph Johnson's note in lieu of cash. Randolph Johnson signed and delivered his note for the amount of $6,095.95 payabel to O.J.M. Development Co. and the deal with T. R. Johnson was closed and the property was deeded to T. R. Jhnson, J. B. McPherson, Phil O'Jibway and Shedrick E. Jones owned the O.J.M. Development Co. D. R. Aylesworth was a commission agent.

Appellee does not deny signing and delivering the $6,095.95 note sued upon herein and acknowledges that one of the reasons he signed the note was so his brother, T. R. Johnson, would not lose his money he paid as a down payment. He further acknowledges the note has never been paid. The record here often refers to T. R. Johnson as T . R. or Terrell and J. B. McPherson as J. B.

The case was submitted to a jury upon three special issues, and the jury in answer to the issues found that McPherson represented to appellee at the time he executed and delivered the note in question he would not be obligated to pay the note, and that appellee relied upon such representation; and that Aylesworth did not accept the note prior to maturity for value without notice of any false or fraudulent representation. Upon the verdict of the jury the court entered judgment that appellants recover nothing of the appellee.

It was appellee's contention tht J. B. McPherson falsely and fraudulently represented to appellee that he was an accommodation maker only on said note and that same was to be executed to enable O .J.M. Development Co. to close a land transaction with appellee's brother, T. R. Johnson; that said land transaction was not to be binding upon either appellee or T. R. Johnson, but that the same was to be closed so that O.J.M. Development Co. could transfer land notes not only on the land under which T. R. Johnson was under contract to purchase but also other lands in Cochran County to an insurance company; that after such notes were transferred McPherson would either sell the land which T. R. Johnson contracted to purchase or have his agent Aylesworth to sell the same and hold appellee harmless from any obligation on said note, further pleading McPherson represented that in the event that said land could not be sold and T. R. Johnson relieved from the obligation of his contract that he would in such event charge the amount of said note to the commission account of Aylesworth, and in either event appellee would never be called upon to pay the note in controversy.

The real contention of appellee herein is that he executed and delivered the note in question but that he had an agreement with McPherson that he would never have to pay the same. Although appellee testified that one reason he signed the note was so his brother, T. R. Johnson, wouldn't lose his $3,500.00 down payment, his main contention that he was not to be liable on the note was as follows:

'Q. All right. Now, at the time this note was made then, was anything said about payment of the note?

A. Before I ever signed the note, when Mr. O'Jibway went to get the note prepared, I asked J. B., I said, 'J. B., what if this note--', I said, 'What about this note? Now, in case you don't get the land sold--'. Of course, the conversation previous to that was that we're going to sell the land and you don't have to pay the note and so I said, 'Well, what if it's not paid or the land is not sold? What if it's not paid by Terrell and the land is not sold, then what?' He said, 'Dave has a big commission coming out of the sale of this land,' he said, 'We all do', and he said, 'If it's not paid by T.R., don't worry about it, I will take it out of Dave's commissions and he will--and then I'll send him to Morton--', and those are the very words he said, 'I'll make him go to Morton and camp until he sells this land and clarifies this whole situation.' He said, 'He's the cause of getting this whole--getting us both in this whole mess.' And that was the exact quotation Mr. McPherson told me in his office.'

It is a familiar rule that conversations and negotiations preceding the execution of written instruments are inadmissible as having been merged in the writing. One of the elementary principles of law is that written instruments such as the note here in question may not be varied by evidence of an oral agreement that contravenes the terms of the written instrument, and it is error for the court to consider such evidence as the basis for any finding of fact to defeat the written instrument. It is stated in Hubacek v. Ennis State Bank, 159 Tex. 166, 317 S.W.2d 30 as follows:

'The parol evidence rule is not a rule of evidence at all, but a rule of substantive law. McCormick and Ray, Texas Law of Evidence, 2nd Ed., § 1601; 20 Am.Jur., Evidence, § 1100; 32A C.J.S. Evidence § 851.

'When parties have concluded a valid integrated agreement with respect to a particular subject matter, the rule precludes the enforcement of inconsistent prior or contemporaneous agreements. 17 Tex.Jur., Evidence, §§ 352, 353; McCormick and Ray, supra, § 1601.'

It is also stated in Steve Lynn Motor Company v. Pavelka, 371 S.W.2d 928 (n.w.h.) as follows:

'The plea...