Schenck v. Foster Building & Realty Co.

• Decision Date: 30 October 1919
• Docket Number: (No. 486.)
• Citation: 215 S.W. 877
• Parties: SCHENCK et al. v. FOSTER BUILDING & REALTY CO. et al.
• Court: Texas Court of Appeals

Page 877

215 S.W. 877

SCHENCK et al. v. FOSTER BUILDING & REALTY CO. et al.

(No. 486.)

Court of Civil Appeals of Texas. Beaumont.

October 30, 1919.

Error from Harris County Court; W. E. Monteith, Judge.

Suit by the Foster Building & Realty Company against Mrs. S. M. Schenck and husband, wherein defendants brought in Ed Kennedy as defendant on their cross-suit. To review the judgment, defendants bring error. Reversed, in so far as against defendants, and judgment rendered. Affirmed as to defendant Kennedy.

H. E. Stephenson, of Houston, for plaintiffs in error.

Kitrell & Kitrell and F. A. Liddell, all of Houston, for defendants in error.

BROOKE, J.

This is a suit instituted by the Foster Building & Realty Company, a private corporation, one of the defendants in error, in the county court at law of Harris county, Tex., on September 21, 1916, against plaintiffs in error Mrs. S. M. Schenck and her husband, F. M. Schenck, to recover upon an instrument in writing executed on the 4th day of March, 1916, by plaintiff in error Mrs. S. M. Schenck, payable on the 4th day of June, 1916, to Ed Kennedy, in the sum of $350, drawn on the Houston National Exchange Bank of Houston, Tex., and claimed by plaintiffs in error to be a bill of exchange, and by defendant in error Foster Building & Realty Company to be a check.

The suit was instituted primarily against plaintiff in error, Mrs. S. M. Schenck, seeking to recover a personal judgment against her and her separate estate. No amended pleadings were filed by defendant in error Foster Building & Realty Company.

On April 17, 1917, plaintiffs in error filed, with leave of court, their first amended original answer and cross-action, in which they urged: First, general demurrer; second, special exception to plaintiff's petition, in that the facts alleged therein show that the obligation is one incurred by a married woman and not enforceable under the laws of the state of Texas; third, general denial; and fourth, answer and cross-action, in which plaintiffs in error brought in defendant Ed Kennedy, who transferred the instrument declared upon to defendant in error Foster Building & Realty Company.

Plaintiffs in error alleged, in substance, that the instrument declared upon by defendants in error in their original petition was procured by fraud and misrepresentations on the part of defendant in error Ed Kennedy; that on March 4, 1916, the said Kennedy represented to plaintiff in error Mrs. S. M. Schenck that he was the owner of five shares of stock in the Richmond & Western Traction Company, worth at least the sum of $500; that if plaintiffs in error would purchase said stock, he, being president of the company, would guarantee that plaintiff in error F. M. Schenck would be given by the company a position which would pay him at least $150 per month, and entitle plaintiffs in error to a pass over the Interurban Railway to be constructed by said company from Houston to San Antonio, Tex.; that at the time said representations were made plaintiff in error Mrs. S. M. Schenck agreed to buy said stock for a fixed price of $500, $150 cash, which was then and there paid, and the sum of $350 due and payable June 4, 1916, practically three months later. It was alleged by plaintiffs in error in their cross-action that the said Mrs. S. M. Schenck was not financially able to pay for the stock on March 4, 1916, but hoped to procure the money by the time the instrument was due on June 4, 1916, and that the instrument executed was not to be transferred, but was to be held by defendant in error Ed Kennedy; that pending the due date of said instrument plaintiff in error F. M. Schenck discovered that the stock was worthless; declined to pay same at maturity, it being then held by defendant in error Foster Building & Realty Company. Plaintiffs in error further alleged that the contract was made for their use and benefit by Mrs. S. M. Schenck, then a married woman. They also alleged coverture as a defense to said instrument as against plaintiff in the original suit, and asked that Ed Kennedy be brought in on the cross-suit, and that plaintiffs in error recover judgment against him for the sum of $150, with interest, the amount originally paid, and that defendant in error Foster Building and Realty Company, plaintiff below, take nothing by its suit against plaintiffs in error.

Defendant in error Ed Kennedy filed a general demurrer and general denial to plaintiffs in error's cross-action, and on the facts averred that plaintiffs in error were in no way defrauded or overreached by any representations made by him at the time of the payment of the $150 aforesaid, and asked to be relieved from any liability as to the return of the $150 or otherwise.

Defendant in error Foster Building & Realty Company filed its supplemental petition, in which it demurred generally to plaintiffs in error's allegations in their cross-action, filed general denial, and on the facts averred that it became the owner of the instrument declared upon for a valuable consideration before the same was due, without the knowledge of any of the facts set up by the defendants, plaintiffs in error, in reference to their contract with the defendant in error Ed Kennedy.

The trial court overruled all demurrers and exceptions and the cause proceeded to trial before a jury. The court instructed the jury to find for defendant in error Foster Building & Realty Company on the instrument declared upon for the full amount claimed against the separate estate of Mrs. S. M. Schenck, and that plaintiff take nothing against the defendant F. M. Schenck. On the cross-action feature of the case, as between plaintiffs in error and defendant in error Ed Kennedy, the cause was submitted on special issues, and resulted favorably to plaintiffs in error on each issue submitted to the jury. Upon the findings of fact by the jury, and the instructed verdict by the court, the court entered judgment that plaintiff below, Foster Building & Realty Company, recover from plaintiff in error Mrs. S. M. Schenck the sum sued for; that execution issue against her separate estate; that plaintiffs in error, on their cross-action, recover the sum of $150, with interest, as against the defendant in error Ed Kennedy. The judgment further provided that plaintiffs in error have jugment over and against Ed Kennedy for such a sum as they may be required to pay on the judgment rendered against them in favor of the defendant in error Foster Building & Realty Company.

Within due time plaintiffs in error filed their motion for a new trial, which was heard, considered, and overruled by the court on the 5th day of May, 1917, to which action of the court plaintiffs in error excepted and gave notice of appeal, and have perfected their writ of error to this court.

We make the further additional statement of the issues and questions to be determined in this case, as follows:

The instrument declared upon by defendants in error was a contract entered into by Mrs. S. M. Schenck, then a married woman, to pay the sum of $350 to defendant in error Ed Kennedy, or order, in the event the Houston National Exchange Bank of Houston, Tex., failed on the 4th day of June, 1916, to honor her bill of exchange. In other words, it was a contract on the part of Mrs. S. M. Schenck that she would be liable to pay the sum of $350 to defendant in error Ed Kennedy or his assigns on June 4, 1916, if the bank failed to pay it.

Whether a married woman in Texas could be bound on such a contract at that time is practically the sole question involved. Defendant in error Foster Building & Realty Company instituted a plain suit upon a contract without averring any facts which would tend to show that the contract was one especially provided for by statute, such as necessities or for the improvement of the wife's separate estate. It alleged facts to indicate that Mrs. Schenck was a married woman, and nowhere controverted the issue of coverture. The law, as it existed on the 4th of March, 1916, made plaintiffs' petition subject to general demurrer, and the complaint is made that the court erred in overruling plaintiffs in error's general demurrer, and also complaint is made that the court erred in directing a verdict for defendant in error Foster Building & Realty Company against the plaintiff in error Mrs. S. M. Schenck, because the evidence unquestionably determined that the instrument was one upon which a cause of action could not be founded, under the laws of Texas.

We will group the first and second assignments of error, which are as follows:

(a) "The court erred in overruling the general demurrer urged by defendants Mrs. S. M. Schenck and husband, F. M. Schenck, because said petition shows on its face that the instrument declared on is not enforceable against defendant Mrs. S. M. Schenck, and shows no cause of action against her."

(b) "The court erred in overruling defendant's special exception to plaintiff's original petition, in that it shows on its face that the basis of the cause of action is a contract sought to have been executed by a...