Phillips v. Holman

• Decision Date: 01 January 1862
• Citation: 26 Tex. 276
• Parties: A. H. PHILLIPS v. JAMES S. HOLMAN.
• Court: Texas Supreme Court

26 Tex. 276

A. H. PHILLIPS

v.JAMES S. HOLMAN.

Supreme Court of Texas.

1862.

A., being owner of certain certificates of stock, entered into an agreement with B., by which he assigned and transferred such stock to B., who engaged to dispose of it in such manner as would in his judgment be most profitable and productive, and on settlement A. was to be allowed the original cost of the stock and one-half of the profits to be realized in its disposition by B., and B. was to be entitled to the other half of the profits; and no time was limited in the contract for the performance by B. of his obligations to dispose of the stock, or to account to A. therefor: Held, that the contract did not create in B. that kind of technical and continuing trust which is unaffected by the statute of limitations.

Such a contract implied that it should be performed within a reasonable time, and devolved upon B., after the lapse of a reasonable time, the obligation to account to A.

The time when the statute of limitations would begin to run upon such a contract would perhaps be when A. would be entitled to call for and enforce an account from B., either because a reasonable time had elapsed for the disposal of the stock by B., or because he had in fact made a disposition of it, which had come to the knowledge of A.

In this case the evidence seemed to establish that B. parted with the certificates of stock in 1838, and in lieu thereof became possessed of certain Galveston city lots, which lots were sold in 1840, and a portion of their proceeds was paid over to A; held, that this was such notice to A. as entitled him to call for a full account from B., and that the statute of limitations began to run from the time of such notice.

It is settled that the clause of our statute of limitations which excludes from the period limited by the act the time of the debtor's absence from the state, applies to each departure of the debtor from the state and includes the whole time of his absence.

When the defendant has shown facts which set the statute of limitations in motion in his favor, the burden devolves upon the plaintiff to show that the defendant had been absent from the state for such periods as would, if taken from the whole time from the accrual of the cause of action to the institution of the suit, reduce the time to less than four years. In plainer terms, it devolved on the plaintiff to show that the defendant had not been in Texas four years in all, between the time when the cause of action accrued and the institution of the suit.

The plaintiff, however, is not required, in such a case, to prove the precise periods of the defendant's absence; but it will suffice for him to establish facts from which the jury may reasonably conclude that the defendant had not been within the limits of the state four years in the aggregate, between the accrual of the cause of action and the institution of the suit. Such facts being shown by the plaintiff, it then devolves upon the defendant to rebut by evidence the conclusion to which such facts conduce.

See this case for an application to evidence of the foregoing principles with regard to the statute of limitations.

APPEAL from Travis. Tried below before the Hon. A. W. Terrell.

This suit was instituted by the appellant, Phillips, against the appellee, Holman, on the 27th day of March, 1857. The plaintiff alleged in his petition that, on or about the 18th of May, 1838, he and the defendant entered into a contract by which it was agreed that plaintiff “should assign and transfer to said Holman seven shares of Galveston city stock, the original cost of which was $275 for each share. Said Holman agreed to use said shares of stock as in his judgment would make it most profitable or productive. On settlement of accounts, your petitioner was to be allowed the original cost of $275 for each share and one-half of the profits arising from the use of said stock. Said Holman was to receive the other half of all profits arising from the same.” The petition then proceeded to aver performance by the plaintiff, and alleged that in the year 1840 the defendant sold and disposed of the stock, making a profit of $2,150. Plaintiff further alleged that the defendant absented himself in the year 1840 from the republic of Texas, and that until within the last twelve months before the filing of the petition, he had been without the limits of the republic and state of Texas, and during all that time had had no fixed place of residence. Plaintiff prayed for judgment against defendant for the sum of $3,000, and legal interest thereon since the year 1840.

By an amended petition, the plaintiff averred that by virtue of the contract, the defendant became a trustee and liable to him as such; that by means of certain transactions specifically set forth, the defendant had, before his departure from the republic in 1840, converted the stock into city lots of the city of Galveston, and had realized upon the stock $2,000 per share; and prayed for judgment for the sum of $7,960, and interest from November 7, 1840. The plaintiff made several other amendments, of which, in view of the opinion of the court, it is not necessary to take particular notice.

The defendant, by his answer and several amended answers, pleaded various defenses, and among others the statute of limitations of four years, and averred his frequent and open returns to and presence in the state, after his departure therefrom in 1840; and alleged sundry payments to plaintiff on account in 1840.

The opinion sufficiently recites the substance of the evidence adduced under these pleadings.

At the spring term, 1859, a trial was had, and there was verdict and judgment for the defendant; a motion for a new trial, and a motion in arrest of judgment made and overruled; and the plaintiff appealed.

The fifth instruction asked by the plaintiff and refused by the court, to which reference is made in the opinion, was as follows: “If the jury believe that Holman absented himself from Texas in 1840, and from that time until suit was brought, was a transient person in Texas, was only temporarily here and had no fixed place of residence in Texas, it is incumbent on the defendant to show that he was in Texas a sufficient length of time, all taken together, to entitle him to the benefit of the statute of limitations; and positive proof of the entire periods of absence of defendant is not required of plaintiff.”

W. L. & C. L. Robards, for appellant. 1st. If Holman had retained possession of the stock up to the institution of this suit, Phillips could have compelled him either to transfer or execute the trust and account, and the statute would have been no bar. If a trustee is in possession and does not execute the trust, the possession of the trustee is the possession of the cestui que trust; and his possession does not operate as a bar, because his...