Sears, Roebuck and Co. v. Duke, B--1264
| Decision Date | 07 May 1969 |
| Docket Number | No. B--1264,B--1264 |
| Parties | SEARS, ROEBUCK AND CO., Petitioner, v. Waldo DUKE, Respondent. |
| Court | Texas Supreme Court |
Key, Carr, Carr & Clark, Donald M. Hunt, Lubbock, for petitioner.
Evans, Pharr, Trout & Jones, John A. Flygare, Lubbock, for respondent.
Sears, Roebuck and Co. sued Waldo Duke for the price of merchandise sold to an impostor using the Sears credit card issued to Duke. The purchases were made within two weeks following Duke's loss of the card, and two weeks before either he or Sears had knowledge of its loss. After the jury absolved both parties of negligence, the trial court entered judgment for Sears. The Court of Civil Appeals ordered a new trial on the ground that Sears failed to offer sufficient proof of the exercise of care, on the occasion of each sale, to ascertain the identity of the credit card user. 433 S.W.2d 919. We hold that the Court of Civil Appeals imposed an incorrect duty on Sears, that Sears was entitled to rely upon the card alone as identification unless circumstances presented cause for further inquiry; and we remand the case to that court for reconsideration of points before it.
Duke and his wife lived in Lubbock, Texas and did business with the Sears store located there. In 1960 he signed a 'Sears Revolving Charge Account Agreement' which began as follows:
'In consideration of your selling merchandise to me on Sears revolving Charge Account, I agree to the following regarding all purchases made by me or on my Sears revolving Charge Account identification * * *'
Two credit cards were issued with the account number and the name, Waldo N. Duke, on the front of the cards. There is no question raised at any point in this record but that the credit cards were the Sears 'identification' to which the credit agreement refers. No additional terms of agreement appear on the back of the card, but there is a statement saying that the card is the property of Sears and its loss or theft should be reported. Mrs. Duke signed as 'authorized purchaser' and used one of the cards. The second card, unsigned, was carried by Duke with a number of other credit cards.
Duke was in New York on a business trip during the week of December 12, 1965, and he left his credit cards in a suitcase in his hotel room. Apparently the thief took the Sears card and a Sinclair Refining Company card, made a note of Duke's home address and signed 'Waldo N. Duke' in his own handwriting on the Sears card. Presumably the card was taken December 13, and over $1,200 in merchandise was purchased in various Sears stores in the New York area within the following two weeks. On January 12, 1966, the credit department of the Sears store in Lubbock received notice of the unusual number of charges on the Duke account, and an inquiry was made to Mr. and Mrs. Duke. It was then that all of the parties first realized that the card was missing.
Duke has taken the position that he is not liable for the unauthorized use of his credit card, or for sales made by Sears to a stranger. There is no basis here for tort liability against Duke. The evidence clearly supports the findings of the jury to the effect that Duke was not negligent in the loss of his card or in the failure to report the loss to Sears. The jury has found that Duke was not negligent in failing to sign his card, and no point in that connection is presented to us. The question then is his contractual obligation, and this turns upon the construction of the words of the credit agreement set forth above. By that agreement Duke did more than promise to pay for merchandise he purchased. He promised to pay for 'all purchases made on my Sears revolving Charge Account identification.' The meaning we give to these words is that Duke will pay for All sales made by Sears to a purchaser identifying himself by the use of the credit card, which was issued by Sears upon receipt of the executed credit agreement.
Duke says that his obligation does not cover the sale to a person who is not in fact authorized to use the card or to make a purchase on Duke's credit. But this is precisely the purpose...
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