Priddy v. Business Men's Oil Co.

• Citation: 241 S.W. 770
• Decision Date: 05 April 1922
• Docket Number: (No. 1947.)
• Parties: PRIDDY v. BUSINESS MEN'S OIL CO. et al.
• Court: Court of Appeals of Texas

241 S.W. 770

PRIDDY v. BUSINESS MEN'S OIL CO. et al.

(No. 1947.)

Court of Civil Appeals of Texas. Amarillo.

April 5, 1922.

Rehearing Denied May 5, 1922.

Appeal from District Court, Wichita County; P. A. Martin, Judge.

Action by W. M. Priddy against the Business Men's Oil Company and others. From a judgment abating the suit, plaintiff appeals. Reversed and remanded.

Martin & Oneal, of Wichita Falls, for appellant.

Stanley Boykin and H. C. Ray, both of Fort Worth, for appellees.

HUFF, C. J.

This is an appeal from a judgment abating the suit brought by appellant Priddy against appellees, in Wichita county, Tex., for the reason that there was pending a suit in Tarrant county, between the same parties on the cause of action declared upon by appellant. The appellant Priddy instituted this suit in the district court of Wichita county, Tex., in the Thirtieth district, against the Business Men's Oil Company, a trust estate and joint-stock association, with its principal place of business in Tarrant county, Tex., with W. E. Austin as its president, J. J. Walden its treasurer, and S. M. Harrison its secretary, and with W. E. Austin, S. M. Harrison, and J. J. Walden as its trustees, and S. M. Harrison, J. J. Walden, Roy J. Beard, J. F. Foster, A. W. Jonte, W. E. Austin, F. R. Hays, R. H. Tash, and O. F. Olmstead, all of whom reside in Tarrant county, Tex., and J. M. Palmer, who resides in Wichita county, Tex., all sued as defendants. The cause of action declared on is based on two notes for $6,875 each, executed by the Business Men's Oil Company, payable to the order of W. M. Priddy at Wichita Falls, Wichita county, Tex., providing for interest and attorney's fees, and each indorsed by the above-named parties, Harrison, Palmer, Walden, Beard, Foster, Jonte, Austin, Hayes, Tash, and Olmstead, before delivery of the notes to the appellant Priddy. The notes were dated March 13, 1919, and one due in 60 days after date and one due 120 days after date. The prayer in the petition is for judgment against all the parties named as defendants for the principal of the notes sued on, $13,750, with interest and attorney's fees, as stipulated therein.

The appellees, and defendants below, filed a plea in abatement for the Business Men's Oil Company and the other named defendants, except defendant Palmer, in which it is alleged in effect that on the 2d day of May, 1919 (appellant having filed his petition in Wichita county May 29, 1919) all of the above-named defendants, except Palmer, filed suit in the Sixty-Seventh district court of Tarrant county (No. 49043) on the docket of that court, styled Business Men's Oil Company et al. v. W. M. Priddy, by which petition it was alleged the company is a trust estate, duly organized under the laws of the state by a duly executed declaration of trust, wherein W. E. Austin, S. M. Harrison, and J. J. Walden are constituted trustees, and have an office in Fort Worth, Tarrant county, Tex., and the plaintiffs are residents of that county, and that defendant Priddy is a resident of Wichita county; that about March 10, 1919, Priddy, by his agent, Palmer, under guise of forming an oil company for developing certain oil lands upon which Priddy claimed a leasehold interest, induced the plaintiffs to pay to him $5,000 in money and execute two promissory notes, dated March 10, 1919, for the principal sum of $6,875, each, otherwise describing the notes sued on by Priddy in the district court of Wichita county; that Priddy employed Palmer to go to Fort Worth and call on plaintiff with an oil proposition, representing that he (Palmer) had an opportunity to purchase an oil lease on two and one-half acres of land in the Burkburnett oil fields; that the lease was worth $37,000; that he (Palmer), with others whom he named, were ready to organize and willing to form a company to purchase the property, providing the individual plaintiffs, to whom he was then talking, would come in and share in the organization and development of the property; that plaintiff relied on the representations so made and that, knowing one of the parties, W. L. Dugger, who was represented by Palmer as one of the parties who would organize the company to take over the property, and who was a responsible business man, and acting on the above representation, they entered into a contract with Priddy by which it was stipulated that Priddy sold to J. J. Walden, to hold in trust for the Business Men's Oil Company, two and one-half acres of land (describing it) for the sum of $37,500, payable $5,000 in cash, $15,750 in notes, payable one-half in 60 days and the balance in 120 days, the remaining $18,750 to be payable in stock of the Business Men's Oil Company, at a par basis capital of $90,000. At the time of the execution of said notes and contract it was agreed and understood by the plaintiff and defendants that the parties to the contract were the plaintiffs and J. M. Palmer and W. L. Dugger, and that the promise to pay contained in the notes was a joint obligation assumed by all parties, subject to the following understanding: That the notes were to be paid out of money received from the sale of stock in said company; that plaintiffs would not be expected to make any further payment than the $5,000 only out of the proceeds of the sale of stock; that the plaintiffs proceeded to organize the company to sell stock—thereafter they discovered Priddy had accepted the notes without the indorsement of W. L. Dugger, who refused to sign and in fact had never agreed to sign the notes, and that the notes were fraudulently delivered to Priddy by Palmer; that the lease was not on oil land nor surrounded by producing oil wells, etc., and that there was no consideration for the notes; that Palmer was not associated with plaintiffs in good faith, but was in fact the agent of Priddy.

In the petition they offer to do equity by reconveying the oil lease and tender a transfer and offer to place Priddy in statu quo. They seek to recover damages, the amount paid for the land and other special damage; also to cancel the notes, and that they be held for naught; also pray for a temporary restraining order, restraining Priddy from negotiating the notes, etc. Continuing their plea in abatement the appellees allege that Palmer is not a necessary party defendant herein, and is fraudulently made a party by Priddy, repeating that, during the negotiations of the trade, Palmer was the agent of Priddy, and that, if he obtained judgment against Palmer, he will not endeavor to collect it, and that Palmer is wholly and notoriously insolvent, and, further, by their plea identifying the notes sued on in this case as being the same described in the suit in Tarrant county. The appellant excepted generally to the plea in abatement, and specially that the defendants in this cause are not all plaintiffs in cause No. 49043, in Tarrant county, in that Palmer is a party defendant in this cause, and is neither a party defendant nor plaintiff in the cause pending in the district court of Tarrant county. In answer thereto he pleads that Palmer was not a party in the former suit, and he denies that Palmer fraudulently was made a party in the present suit, etc., or that Palmer was his agent in the negotiations of the sale of the oil lease, or that he was insolvent. Upon a trial before the court the following facts were found and filed:

"(1) That suit No. 49043, styled Business Men's Oil Co. et al. v. W. M. Priddy, was filed on May 2, 1919, in the Sixty-Seventh district court of Tarrant county, Tex., according to the copy of the petition in said suit as set up in defendants' plea in abatement, and that the orders of the Sixty-Seventh district court returns thereon were made as alleged in said plea in abatement. I find that said suit in said Sixty-Seventh district is still pending and said orders are still in effect.

"(2) That the notes described in both suits are the same and identical notes, and that the parties in both suits are the same, except the said Palmer is not a party to said suit No. 49043, and is a party defendant in suit No. 6868.

"(3) I find that suit No. 6868, styled W. M. Priddy v. Business Men's Oil Co. et al., was filed on May 29th, and is pending in this court according to plaintiff's amended and original petitions in said suit; that the defendant J. M. Palmer, in suit 6868, is not a party to said suit No. 49043, in said Sixty-Seventh district court, and that suit No. 6868 was not fraudulently brought; that said Palmer was not fraudulently made a party to said suit; that said Palmer was not the agent of the defendant Priddy in the oil lease involved in suit No. 49043, nor in the negotiations set forth in plaintiff's petition in said suit; that said Palmer did not execute the note involved in this suit for the purpose of inducing the other defendants herein to execute the same; that plaintiff, W. M. Priddy, has not had and does not have an agreement with said Palmer that he will make no effort to collect any judgment he should recover against the said Palmer; that the said Palmer is solvent, and was when the said No. 49043 was filed; that the makers of the notes sued on are jointly and severally liable, and that said Palmer is a proper party to said suit No. 6868.

"(4) These findings are confined to the issues raised by defendants' plea in abatement in suit No. 6868, and are not intended to adjudicate any issue raised by the pleadings of the parties on the merits in either suit No. 49043 or No. 6868."

He concluded that as a matter of law a new party in the pending suit does not make this a different cause of action from the cause pending in the Sixty-Seventh, district court of Tarrant county; that, the subject-matter being the same, and the issues the same, the case first filed should have preference, even though another and proper party is impleaded in a subsequent cause, and for that reason he sustains the plea in abatement. We may add at place that the...