Schmaltz v. Walder
| Decision Date | 27 April 1978 |
| Docket Number | No. 1273,1273 |
| Citation | 566 S.W.2d 81 |
| Parties | Audrey H. SCHMALTZ, Appellant, v. John E. WALDER, Progress Drilling Company, Highlands Insurance Company andGeneral Adjustment Bureau, Appellees. |
| Court | Texas Court of Appeals |
This is an appeal from a summary judgment in a suit to recover damages for personal injuries and to set aside a release. Mrs. Audrey H. Schmaltz sued John E. Walder and Progress Drilling Company to recover damages for personal injuries allegedly sustained by her when a truck which was then being driven by John E. Walder, an employee of Progress Drilling Company, struck a trailer that was being towed by an automobile in which she was riding as a passenger. Mrs. Schmaltz also sued Highlands Insurance Company and General Adjustment Bureau to set aside a release which she and Harold B. Schmaltz, her husband, executed subsequent to the accident which released each of the defendants from all liability which resulted from the collision. All defendants filed motions for summary judgment. Plaintiff contested the motions. The trial court granted the motions and rendered judgment that Mrs. Schmaltz take nothing by her suit. Mrs. Schmaltz has appealed.
The collision in question, wherein Mrs. Schmaltz sustained an injury to her knee and damage to property, occurred in Alvin, Texas on March 1, 1975. Thereafter, on March 14, 1975, in consideration of the sum of $2,000.00 paid, she and her husband signed a complete release of all liability with respect to all defendants. Mrs. Schmaltz filed suit on July 28, 1976, wherein she sought damages and asked that the release be set aside. She contends that the release should be set aside because: 1) she did not possess sufficient mental capacity to contract on March 14, 1975, when she signed the release and accepted the $2,000.00; 2) the release was procured by defendants by fraud which was perpetuated on her; and 3) the release was signed as a result of a mutual mistake.
All of the above grounds asserted for setting the release aside are affirmative defenses in the nature of confession and avoidance. Oram v. General American Oil Company of Texas, 513 S.W.2d 533 (Tex.Sup.1974); Nichols v. Smith, 507 S.W.2d 518 (Tex.Sup.1974); "Moore" Burger, Inc. v. Phillips Petroleum Company, 492 S.W.2d 934 (Tex.Sup.1973). Since the release, which is a contract, was admittedly signed by Mr. and Mrs. Schmaltz, and $2,000.00 was paid to and deposited by them in full settlement of all claims, past, present and future, arising out of the collision, the motions for summary judgment were properly granted unless Mrs. Schmaltz, the non-movant, came forward with summary judgment proof sufficient to raise an issue of fact with respect to at least one of the grounds asserted by her for avoiding the release. Zale Corporation v. Rosenbaum, 520 S.W.2d 889 (Tex.Sup.1975); Gulf Colorado & Santa Fe Railway v. McBride, 159 Tex. 442, 322 S.W.2d 492 (1959).
The defendants' summary judgment proof consisted of an affidavit of Mr. William E. Henry, Branch Claims Manager of Highlands Insurance Company, which had attached thereto as exhibits duly authenticated copies of the aforesaid release and of the draft. Such, without more, was sufficient to grant defendants' motions for summary judgment. Therefore, we must examine the summary judgment evidence of Mrs. Schmaltz to determine whether such evidence establishes as a matter of law that there is no genuine issue of fact as to at least one of the grounds asserted for avoiding the effects of the release.
A settlement agreement and release, valid on its face, until set aside, is a complete bar to any later action based on matters included in the settlement agreement and covered by the release. Hart v. Traders & General Ins. Co., 144 Tex. 146, 189 S.W.2d 493 (1945).
"Evidence", as that term is used in this opinion, means "summary judgment evidence" as presented by the affidavits and depositions on file in the trial court. The testimony and statements of the parties, hereinafter noted, are found in the affidavits and depositions.
Following the accident, Mrs. Schmaltz was treated by a doctor in Alvin for her injury and was released. A few days later, she returned to Corpus Christi, and was contacted by Mr. Mike Winner, an adjuster with General Adjustment Bureau. On their first visit, Winner and Mrs. Schmaltz discussed the matter of damages. Winner came up with a figure of $2,000.00 as a firm settlement offer. During the discussion with Winner, Mrs. Schmaltz suggested that $5,000.00 would be more in line with the damages she sustained. Winner, however, rejected the suggestion and told her firmly, but politely, that she was "making claims that weren't possibly covered". Mrs. Schmaltz then told Winner that she would have to go over this with her husband. The $2,000.00 settlement offer was calculated as follows:
Value of antiques in Trailer .. $1,500.00
Medical expenses in Alvin ......... 35.00
Replacement of trailer ........... 450.00
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$1,985.00
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Mrs. Schmaltz acknowledged that her out-of-pocket expenses, as reflected in the above calculations, did not total $2,000.00. Further, she stated in her deposition that the $2,000.00 was:
"To cover the contents of the trailer, replacement of the trailer, and it would take care of the doctor bills in Alvin and a few other little like the rental (use of the booth that she had lost by missing the antique show in Houston) and things like that that he (Winner) allowed and he thought that was ample."
The only other "little things" mentioned by Mrs. Schmaltz in her deposition was a doctor bill for her visit to Dr. Nast, her personal physician in Corpus Christi, on March 19, 1975. There is no summary judgment proof relating to the amount charged by Dr. Nast for this visit.
On the evening of Winner's call on Mrs. Schmaltz, the settlement offer was discussed by and between Mr. and Mrs. Schmaltz. Later, she discussed the settlement proposal with Mrs. Louise Bowman, her sister, and with her son. Shortly thereafter, Mrs. Schmaltz told Winner that she and Mr. Schmaltz had decided to accept the $2,000.00 in settlement of her claims for damages. The next day, she and her husband went to Winner's office, where Winner handed them the release and asked that they both read it, which they did. They then signed the release and were given a sight draft for $2,000.00. They deposited the money to their account.
Mrs. Schmaltz saw Dr. Nast on March 19, 1975. She again contacted Winner and told him that it was her understanding that Highlands Insurance Company would take care of her medical bill for her visit on March 19, 1975, and that since her subsequent visits to Dr. Nast stemmed from the visit on March 19, 1975, defendants were required to pay all such medical bills. Winner replied that she had signed the release, and Highlands Insurance Company could not take care of any of the doctor bills. Whereupon, Mrs. Schmaltz filed this suit.
The general rule is that a contract, such as the release here involved, executed by a person who does not have the mental capacity to contract is voidable; and if such person signed a contract without sufficient mental capacity to understand the nature and consequences thereof, the contract is not binding and may be set aside. Nohra v. Evans, 509 S.W.2d 648 (Tex.Civ.App. Austin 1974, no writ); 50 Tex.Jur.2d, Release, § 4. The validity of a release must be determined as of the date it was executed, and in light of the circumstances surrounding the parties at that time. Atkins v. Womble,300 S.W.2d 688 (Tex.Civ.App. Dallas 1957, writ ref'd n.r.e.).
Mrs. Schmaltz, with respect to her mental capacity at the time in question, stated in her deposition that after the offer of $2,000.00 had been under discussion with her husband, she told him:
.
She further stated that she was under "nervous tension and I was just all upset over everything". Mrs. Schmaltz also consulted with her sister, Mrs. Louise Bowman, and said to her:
". . . I can't take any more of it . . . the nervous anxiety, the tension that I was under. . . . this is the tension of not having it resolved, . . ."
The tension and anxiety, according to Mrs. Schmaltz's statements in her deposition, was caused by the fact that she "wanted to get it over with" in order to get money to ...
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