Meaders v. Biskamp
| Decision Date | 09 July 1958 |
| Docket Number | No. A-6707,A-6707 |
| Parties | Paul L. MEADERS, Jr., Independent Executor of the Estate of Paul L. Meaders, Sr., Deceased, et al., Petitioners, v. Ernest J. BISKAMP, Respondent. |
| Court | Texas Supreme Court |
George G. Clifton, San Antonio, for petitioners.
Cox, Patterson & Smith, San Antonio, for respondent.
This is a suit by the respondent, Biskamp, against the petitioners who are the heirs and legal representatives of Paul L. Meaders, Sr., deceased, and against Mrs. Vivian O'Connor. Biskamp alleged that he and Paul L. Meaders, Sr. entered into a contract whereby Biskamp sold to Meaders five oil and gas leases on lands in Karnes County, Texas. Biskamp was to drill one well on one of these leases to a certain depth. For the leases and the drilling of the well, Meaders was to pay the sum of $25,000. An escrow contract embodying the agreement between the parties was prepared and properly signed by all parties and deposited with the Alamo National Bank of San Antonio, Texas, the designated escrow holder. The agreement provided that Biskamp would execute the assignments of the five oil and gas leases to Meaders, and Meaders would pay the $25,000 purchase price to the Bank, as escrow holder. Upon completion of the drilling of the well, the Bank would deliver the money to Biskamp and the assignments of the leases to Meaders. Instead of depositing the $25,000 in cash, Meaders deposited the personal check of Mrs. Mary Vivian O'Connor for $25,000 and payable to the Bank. Before the completion of the well, Mrs. O'Connor stopped payment on her chcek. This lawsuit resulted. Biskamp settled with Mrs. O'Connor for $22,500, and she was dismissed from the suit. During the pendency of the suit Paul L. Meaders, Sr., died and his heirs and legal representatives were substituted as defendants. The defendants answered and claimed the plaintiff had accepted Mrs. O'Connor's check in lieu of the cash called for by the contract, and that accordingly Meaders was released from any further liability. On trial before a jury the jury answered that Biskamp had accepted the check for $25,000 as the purchase money to be paid under the contract. Judgment of the trial court was adverse to plaintiff, Biskamp. He appealed to the Court of Civil Appeals where the judgment by the trial court was reversed and rendered that plaintiff recover the sum of $2,500 balance due on the purchase price, together with $5,000 as a reasonable attorney's fees. 308 S.W.2d 898.
Defendants, Meaders et al., assign error to the judgment of the Court of Civil Appeals in that it erred in holding there was no evidence to support the jury's answer that Biskamp had accepted the check of Mrs. O'Connor as payment of the purchase price. The evidence consisted of Biskamp's testimony as to what was meant by a certain letter transmitting the escrow contract and its attached papers to the Alamo National Bank. The letter of transmittal was as follows:
'August 24, 1954
'Alamo National Bank
San Antonio, Texas
'Gentlemen:
'I hand you herewith contract, leases, and check in the sum of Twenty Five Thousand Dollars ($25,000.00), which check to be held by you and not cashed for a period of ten (10) days from its date. Otherwise, this check is to be held in escrow under the terms of contract herewith tendered you.
'Yours truly,
(signed) Paul Meaders
'The above mentioned check is dated August 24, 1954, being Check No. B-10184 payable to Alamo National Bank in the sum of $25,000.00 drawn on Victoria Bank and Trust Co., Victoria, Texas by and signed by Mary Vivian O'Connor.
'Ernest J. Biskamp
(Printed)
OK
EJB'
There are no allegations of fraud, accident or mistake made by any of the parties. We do not find it necessary to decide whether or not the letter was admissible in evidence. Granting for the sake of this cause that the letter was admissible in evidence, we find no language therein which can be construed as an agreement on the part of Biskamp to accept the $25,000 check given by Mrs. O'Connor in lieu of the purchase price. The letter is plain and unambiguous; therefore, Biskamp's testimony as to what the letter meant was not admissible.
It is the general rule of law that where the creditor accepts the check of another in payment of debtor's obligation, such check amounts only to conditional payment of the obligation. Upon the check being dishonored by non-payment, the original debt still remains. Of course, the parties can agree that the check will be substituted for the obligation to pay and such agreement supported by a valid consideration will be given effect. 32 Tex.Jur. 648, 650, Secs. 11 and 21, Payment; State v. Tyler County State Bank, Tex.Com.App., 277 S.W. 625, 42 A.L.R. 1347, rehearing denied, Tex.Com.App., 282 S.W. 211, 45 A.L.R. 1483; 40 Am.Jur. 766, Sec. 76, Payment. It is held that a check given by debtor is not payment of debt in the absence of agreement between the parties. Middlekauff v. State Banking Board, 111 Tex. 561, 242 S.W. 442; Muldrow v. Texas Frozen...
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