"The plaintiffs in error, Nabours and others, brought this suit for their own use and for the use of all other accepting creditors of W. F. and F. M. Crawford under a deed of assignment made to defendants McCord and Henderson, as assignees, naming as defendants the assignees and their bondsmen and the Milam County Oil Mill Company. At the trial the plaintiffs dismissed their suit as against the defendants Henderson and the bondsmen, and upon the verdict of a jury for the remaining defendants, judgment was accordingly entered, from which the plaintiffs have sued out this writ of error. The suit as against McCord is predicated upon the charge of breach of duty on his part in negotiating and making a pretended sale of part of the assigned estate to a third party under circumstances contemplating a retransfer to him, followed by such transfer and subsequent appropriation of the property to his own use.
"The property which it is alleged that McCord thus acquired consisted of stock in the defendant oil mill of the par value of $24,200, an undivided interest of 1,300 acres of land in Jefferson county, a like interest of 1,000 acres in Milam county, and a one-half interest in five notes of the face value of $5,743.75, secured by a vendor's lien on 510 acres of land in Milam county. The oil mill was made defendant for the purpose of protecting the rights of creditors in the above stock pending this suit as to the payment of dividends and otherwise.
"The plaintiffs in error seek a reversal of the judgment upon three grounds, viz.: (1) Error in the court's charge as given; (2) error in refusing a special charge asked; and (3) error in refusing to set aside the verdict on motion for a new trial, because contrary to the evidence. It is sufficient for the purposes of this opinion to find the facts of the case, as shown by the record, to be:
"(1) W. F. Crawford and F. M. Crawford, bankers at Cameron, Texas, under the firm name of Milam County Bank, failed in business March 16, 1896, owing debts secured to the amount of $45,190.97, and unsecured in the sum of $79,619.40. On that day they executed a statutory deed of assignment, naming McCord and Henderson as assignees, who qualified on the following day, and proceeded with the administration of the trust until they filed their final report on June 23, 1900.
"(2) This report shows that the remnant of the estate, consisting of the property sued for and other lands and chattels, was sold to C. W. Lawrence on May 5, 1897, for the sum of $22,500; that the total receipts were $90,271.21, a large part of which was used in redeeming such of the assets held in pledge as were thought to be to the interest of the estate, and the balance, after paying expenses, was sufficient to pay five dividends, aggregating forty and 82/100 per cent. to the unsecured creditors, who had filed claims amounting to $76,624.22, leaving unpaid practically 59 per cent. of these claims, or more than $45,000.
"(3) The plaintiffs were among those who accepted under the deed of assignment, filed their claims, duly verified, as required by law, and have rights entitling them to prosecute this suit.
"(4) The facts connected with the sale to Lawrence, as disclosed by the testimony of himself and Ralston and other witnesses for the defendants, are as follows: Lawrence and one Sprinkle had for some time been considering the joint purchase of the remnant of the assets, after the assignees had indicated a desire to close the administration by sale in bulk, if necessary, and had made a list of what remained, and attached a value or selling price to certain articles, among which was the property in controversy. Ralston and his law partner were employed by these parties under an agreement that Lawrence and Sprinkle should furnish the money to make the purchase, and the lawyers were to assist in making collections and sales, and the net profits, after repaying the money advanced and interest, were to be equally divided. Mr. Henderson, as one of the assignees, appears to have been anxious to close out the assets, and received a bid of about $20,500 for the remnant from one Hefley. Notice of this reached Lawrence and Ralston, and they began to consider what amount they would offer. There is no evidence that the bid made by Hefley was his final offer, and it is shown that, as soon as he heard of the deal with Lawrence for $22,500, he offered him $2,000 for his bargain. Lawrence did not want to buy the oil mill stock and the other property sued for, to which values were affixed in the list, and objected particularly to the stock. Ralston, who lived with McCord, and was related to him, told him of Lawrence's objections, to which McCord replied, as shown by Ralston's testimony, `The oil mill stock is worth that much money ($8,000), and ought to sell for that much money, and if he makes a proper bid, and gets the oil mill stock, and wants to sell it for that amount, I can get him a purchaser for it at that.' Ralston states that in talking with Lawrence the next day he stated to him `that we need not be afraid of not being able to turn the oil mill stock, if we wanted to, at that price; that, if we bought it, that a party told me that he would have a purchaser for it at that price if he [we] wanted to sell it.' Ralston did not tell Lawrence who made the statement, and the only inquiry made by Lawrence was if the party was responsible, and could be relied on. He then raised objections to the other properties sued for. This was also reported to McCord by Ralston. The same assurances being given and reported back to
Lawrence, he concluded that he would be safe in making an offer of $22,500 for the remaining assets, provided he could get terms. The record does not show what terms were asked, but the contract, as closed, resulted in the assignees giving him until June 1st to pay $8,500 and until October 15th to pay the remaining $14,000, they to retain possession of everything, and to surrender the different items to him as he was able to realize upon them and pay their list value. A written proposition was then drawn to the above effect, and carried by Lawrence to Henderson, who objected to signing an acceptance of it until he could consult with McCord. Being assured by Lawrence that, if it was not satisfactory to McCord, the trade would not be closed, Henderson signed the paper, and it was subsequently signed by McCord, but the date of his doing so is not shown. While Lawrence, in giving his views as to the effect of what occurred in connection with the contract, states that he did not know who the party was that gave the assurance or guaranty of a purchaser to Ralston, and that there was no contract or agreement, expressed or implied, that he was buying for McCord, or was to retransfer any part of the property to him, he nevertheless says `but for the guaranty he would not have bought' the stock and other property sued for; that he made the inquiry as to the responsibility of the party because he `felt or expected that he would sell that stuff to that man,' and wanted to know if he was able to carry out his contract; that he did not want to handle this part of the property, because he did not think there was anything in it; that, after the contract was closed, he paid but little attention to these items of property, because he expected, in pursuance of that guaranty, for them to be taken off his hands. This witness further states that: `After the trade was closed, I saw Mr. Ralston about his land, and I insisted on it being closed up. These were matters that I thought were important, and should be closed up.' Lawrence testifies that when he made the proposition to buy Sprinkle was interested with him; that he went to Sprinkle, told him that there was not enough in the trade for three, and offered to withdraw in his favor; but that Sprinkle declined the offer, and withdrew from the transaction.
"(5) The record shows that after signing the contract of sale, and while the mill stock still remained in the possession of the assignees, McCord borrowed $8,000 from one Flato in Kansas City, with which to pay for this stock, agreeing to hypothecate the same as security; and that on May 27th, the stock still remaining with the assignees, Lawrence, by Ralston's direction, indorsed the certificates to Flato, and his check to McCord for $8,000 was used to pay for the stock; Lawrence testifying that this was the only time he ever had his hands upon this stock. He also testifies that he never had possession of the Steele notes sued for, and, having directed Ralston to call on the `guarantor,' he paid very little attention to what became of these items, and only signed such transfers as Ralston prepared. Ralston testifies that on May 20th he called upon McCord to produce a purchaser for the mill stock, and this he said he would do, and on the 27th directed it to be indorsed to Flato; and when he asked him who the lands should be sold to he said `he didn't know yet, but that he would be responsible for it; considered it was sold to him.' It appears that McCord in this way became responsible for and paid to himself $8,000 for the mill stock and $2,500 for the other properties, but as to how and when this last payment...
