Stegall v. Lytle

• Decision Date: 03 October 1962
• Docket Number: No. 13988,13988
• Citation: 360 S.W.2d 898
• Parties: James STEGALL and Marvin C. Keating, Appellants, v. Horace LYTLE, Appellee.
• Court: Texas Court of Appeals

Page 898

360 S.W.2d 898

James STEGALL and Marvin C. Keating, Appellants, v. Horace LYTLE, Appellee.

No. 13988.

Court of Civil Appeals of Texas, San Antonio.

Oct. 3, 1962.

Perkins, Floyd, Davis & Oden, Lawrence H. Warburton, Jr., Alice, for appellants.

Glusing & Sharpe, Kingsville, for appellee.

MURRAY, Chief Justice.

This is an appeal from a judgment of the District Court of Kleberg County, Texas, overruling the pleas of privilege of James Stegall and Marvin C. Keating to be sued in the counties of their respective residences. The trial court obviously overruled the pleas under the provisions of Subdivision 7, Article 1995, Vernon's Ann.Tex.Civ.Stats., providing in effect that a defendant can be sued out of the county of his residence in a fraud case.

Appellee alleged in his petition, that appellants, James Stegall and Marvin C. Keating, Falsely and fraudulently represented to him in Kingsville, Kleberg County, and with intent to deceive and defraud him, that if he would agree to manage the Piggly Wiggly store in Kingsville, owned and operated by appellants, for a weekly salary of $130.00, and would leave his job with Bonham's grocery store, situated in Kingsville, to assume management of such Piggly Wiggly store, appellants would pay appellee the sum of $130.00 per week, and five per cent of the net profit realized from the operation of the said grocery store as a commission; that the Piggly Wiggly store in Kingsville would be organized as a business corporation and that appellee would be given twenty-five per cent of the stock of such corporation; that appellee would be given full management and control over the store, with the right to determine operating policy, purchases, expenditures and all other usual and ordinary functions of a manager of a grocery store. Appellee further alleged that he believed and relied upon such representations of appellants, and thereafter spent long and exhaustive hours in the management of the store, used his own automobile in the furtherance of the management of appellants' store and incurred substantial operating costs in connection with his automobile without receiving any compensation therefor from the appellants.

Appellee operated the store for appellants under the contract, receiving his weekly salary of $130.00, from April 10, 1960, to August 20, 1961, when he was advised that he was discharged. He does not offer to return to appellants what he received under the contract.

The trial court heard evidence which shows that the business was never incorporated; appellee did not receive 25% of the stock; he was not given a free hand in the management of the store, and was not paid 5% of the profits. The record shows that during the approximately sixteen months that appellee managed the store there was a loss of some $30,000.00, but appellee contends that during one of these months there was a profit and he should have received 5% of that one month's profit, notwithstanding the loss over the sixteen months.

These allegations and this evidence shows at most a breach of an employment contract, and does not show actionable fraud. It is not shown that any fraudulent representation was made as to a present or past fact, all of the representations or promises relied upon by appellee were made as to future events. Before a promise or representation as to a future event can be the basis of actionable fraud, it must have been made, knowing it was false and with no intention at the time, on the part of the defrauder, to carry out such promise or representation.

Appellee contends that the fact that appellants did not fulfill their promises is sufficient evidence to establish that they did not intend to do so at the time they made such promises. We do not agree. The law is to the contrary. In Latstaw v. McLean, Tex.Civ.App., 238 S.W. 1003, the...