Smith v. Bidwell, 1717

• Decision Date: 09 July 1981
• Docket Number: No. 1717,1717
• Citation: 619 S.W.2d 445
• Parties: Frank SMITH and Frank Reaves, Appellants, v. Clinton BIDWELL, et al., Appellees.
• Court: Texas Court of Appeals

Page 445

619 S.W.2d 445

Frank SMITH and Frank Reaves, Appellants, v. Clinton BIDWELL, et al., Appellees.

No. 1717.

Court of Civil Appeals of Texas, Corpus Christi.

July 9, 1981.

Rehearing Denied Aug. 6, 1981.

William E. Nicholas, Nicholas & Kubicek, William G. Burnett, Sinton, for appellants.

Max J. Luther, Barnhart & Luther, Corpus Christi, Mac Ed Swindle, Fort Worth, for appellees.

OPINION

BISSETT, Justice.

This suit involves an action to recover penalties for brokering real estate in Portland, Texas, without a Texas real estate license.

Frank Smith and Frank Reaves, defendants below, appeal from a judgment rendered in favor of Clinton C. Bidwell, M. D. Neill, Stewart Purdy and Louise Purdy, plaintiffs below, and Greg Miller, intervenor below. Bidwell and Neill were the sellers of the involved real property. Stewart and Louise Purdy (the Purdys) were the purchasers. Smith and Reaves were the real estate brokers who got the buyers and sellers together. Greg Miller was a holder in due course of a note executed by the Purdys to Smith and Reaves in payment of the real estate commission.

After a trial to the court, judgment was rendered that Bidwell and Neill recover $30,000.00 against Smith and Reaves, jointly and severally; that the Purdys recover $72,000.00 against Smith and Reaves, jointly and severally; and that Miller receive the monthly payments under the $36,000.00 note. Smith and Reaves appealed the judgment only as to Bidwell, Neill, and the Purdys. Miller did not appeal. Only the Purdys filed an appellees' brief in this Court.

Smith and Reaves, in their first point of error, complain that there is no evidence "to support the trial court finding that (the Purdys) paid $36,000.00 of real estate commissions to (Smith and Reaves) by executing their promissory note ..." In deciding no-evidence points, we must consider only the evidence and the inferences tending to support the findings and disregard all evidence and inferences to the contrary. Garza v. Alviar, 395 S.W.2d 821 (Tex.1965).

In January or February of 1977, Neill, a resident of Arizona, telephoned Smith in Missouri and requested that Smith list the Ramada Inn Motel in Portland, Texas, for sale. Neill and Bidwell were equal owners of the motel. Smith asked for and received permission to advertise the motel for sale in the Motel-Motor Inn Journal. Smith represented to Neill that he and Reaves were licensed to sell real estate in the state of Texas.

Smith is in the business of brokering real estate under the name of Southeast Investment Company. Neither Smith, nor his co-broker, Reaves, nor any member of Southeast Investment Company were licensed to sell real estate in Texas.

As a result of reading an advertisement in the Motel-Motor Inn Journal, Stewart Purdy, a resident of California, talked by telephone with Smith. Purdy said he was interested in purchasing a motel in Texas. It was agreed that Purdy would sell his motel in California and would contact Smith about properties in Texas.

After selling their motel, the Purdys came to Texas and met Smith. He suggested the Purdys go to Portland and look at the Ramada Inn. The day after the Purdys arrived in Portland, Reaves introduced them to Bidwell.

On May 31, 1977, a contract of sale for the Ramada Inn was entered into between the Purdys, as purchasers, and Bidwell and Neill, as sellers. It provided for a $50,000.00 cash deposit on a purchase price of $850,000.00. Also in the agreement was the provision: "Seller agrees to pay the undersigned Real Estate Agent a commission of ...." The contract was prepared by Reaves.

The next day, the prospective purchasers, the sellers and Smith met in an attorney's office in Corpus Christi to close the deal. At that time, the parties decided that the method of payment by the Purdys would be changed. The Purdys were to give $50,000.00 in cashier's checks to Bidwell, out of which $15,000.00 of the real estate commission was to be paid to Smith and Reaves. For the remainder of the commission, the Purdys executed a promissory note for $36,000.00. For the balance of the purchase price, the Purdys executed a 30-year note for $764,000.00.

A few months later, the $36,000.00 note was negotiated to Dreiske and Bailey, who purchased it for a valuable consideration, in good faith, and without notice of any defenses or that the note was voidable. Subsequently, the note was negotiated to Greg Miller.

Bidwell and Neill, in their petition, alleged that they had paid a real estate commission to Smith and Reaves, who were not licensed real estate brokers in the state of Texas. This failure to obtain a license while collecting a commission allegedly violated Tex.Rev.Civ.Stat.Ann. art. 6573a (Supp.1978). Bidwell and Neill prayed for a recovery of damages up to three times the real estate commission paid.

The Purdys subsequently joined this lawsuit, and alleged that they, as purchasers of the real estate, had paid a portion of the real estate commission and thus were entitled to recover penalties under Article 6573a. Then, on October 9, 1979, Greg Miller intervened as the holder of the $36,000.00 note that had been executed by the Purdys in partial payment of the real estate commission.

The contract of sale clearly shows that the sellers are to pay the real estate commission to Smith and Reaves. All the parties to the transaction agreed at the closing to a new arrangement, whereby the Purdys would pay $36,000.00 of the commission with a promissory note. Smith and Reaves assert that testimony in the record as to this subsequent agreement was barred by the parol evidence rule since there was a written contract which provided otherwise. We disagree. The parol evidence rule is not applicable to agreements made subsequent to the written agreement. Lakeway Co. v. Leon Howard, Inc., 585 S.W.2d 660 (Tex.1979); Garcia v. Karam, 154 Tex. 240, 276 S.W.2d 255 (Tex.1955). Furthermore, extrinsic evidence may be offered to show a new agreement or that an existing written agreement has been "changed, waived or abrogated in whole or in part." Mortgage Company of America v. McCord, 466 S.W.2d 868, 871 (Tex.Civ.App. Houston (14th Dist.) 1971, writ ref'd n. r. e.); Garcia v. Karam, supra.

The evidence of the change in the agreement subsequent to May 31, 1977, the day the contract of sale was signed, was competent evidence and sufficient evidence to support the judgment. The first point of error is overruled.

Smith and Reaves, in points of error two and three, complain of a conclusion of law filed by the trial judge that the Purdys were legally subrogated to Bidwell and Neill for the $36,000.00 paid by a promissory note.

We need not decide whether the subrogation conclusion was correct. If the trial court renders an otherwise correct judgment, it will not be set aside because the court may have made an incorrect conclusion of law. Gulf Land Co. v. Atlantic Refining Co., 134 Tex. 59, 131 S.W.2d 73, 84 (1939); City of Corpus Christi v. Davis, 575 S.W.2d 46, 55 (Tex.Civ.App. Corpus Christi 1978, no writ). The trial court found that the Purdys paid $36,000.00 of the commission by their promissory note. The judgment of the trial court in that respect was correct. Points of error two...