Trigg v. Shelton

• Decision Date: 21 February 1923
• Docket Number: (No. 299-3606.)<SMALL><SUP>*</SUP></SMALL&gt
• Citation: Trigg v. Shelton, 249 S.W. 209 (Tex. 1923)
• Parties: TRIGG et al. v. SHELTON.
• Court: Texas Supreme Court

249 S.W. 209

TRIGG et al. v. SHELTON.

(No. 299-3606.)^*

Commission of Appeals of Texas, Section B.

February 21, 1923.

Error to Court of Civil Appeals of Seventh Supreme Judicial District.

Suit by D. C. Trigg and another against J. M. Shelton. From a judgment of the Court of Civil Appeals reversing and remanding a judgment of the district court (226 S. W. 761), both parties bring error. Judgment of the Court of Civil Appeals reversed and judgment of district court reformed.

Kimbrough, Underwood & Jackson, of Amarillo, for plaintiffs.

Hendricks & Mood, of Amarillo, and Coffee & Holmes, of Miami, for defendant.

McCLENDON, P. J.

This suit was brought by D. C. Trigg and S. L. Trigg against J. M. Shelton for an accounting in a cattle partnership which had theretofore existed between the Triggs and Shelton, but which had been dissolved by mutual agreement. Plaintiffs sought recovery for certain specific items alleged to be due them under the contract and dissolution agreement and for certain other items claimed by virtue of alleged mismanagement on the part of Shelton in the conduct of partnership affairs. Shelton, by way of cross-action, sought recovery against the Triggs for certain items alleged to be due him. The cause was tried to a jury upon special issues; the jury finding several items in favor of the Triggs, and some in favor of Shelton, denying all others, including all those based upon alleged derelictions in conducting the partnership business. Upon the jury's findings, the trial court entered judgment in favor of the Triggs for the sum of $11,521.70, the net balance due them under the jury findings. Shelton alone appealed, and in his appeal he questioned only two of the items found against him. One of these items was $10,312.50, which had been paid by the Triggs to Shelton as one-half of his salary at the rate of $7,500 per annum from January 1, 1914, to October 1, 1916, under a supplemental contract between the parties, which contract the jury found was executed by the Triggs under duress. The other item was $739.78, being one-half of the amount found by the jury to have been expended by the Triggs for the maintenance of S. L. Trigg during the partnership, which the Triggs claimed was a proper charge against the partnership under a supplemental verbal agreement between the parties. The salary item was ratified in the dissolution agreement and subsequently paid by the Triggs under protest. The Triggs contended and the jury found that there was no consideration for this item, and that the salary contract, its ratification in the dissolution agreement, and its subsequent payment were under duress. Shelton contended that the evidence would not support these findings. With reference to the maintenance item Shelton contended that the dissolution agreement estopped the Triggs from asserting it. The Court of Civil Appeals reversed the trial court's judgment, and remanded the cause upon a unanimous holding that error was committed in the admission of certain testimony, but overruling Shelton's contention concerning the maintenance item. By a divided court it was held that the evidence supported the jury findings of want of consideration and duress as applied to the salary item. 226 S. W. 761-789.

Both the Triggs and Shelton applied for writ of error, and both applications were granted. The cause is docketed under the style of the application of the Triggs.

The evidence bearing upon the controlling issues in the case may be stated as follows:

On July 31, 1912, the Triggs and Shelton, who will be designated as the purchasers, entered into a contract with the Capitol Freehold Land & Investment Company, Limited, which will be referred to as the syndicate, whereby the former purchased from the latter certain cattle, estimated at approximately 22,000 head, and certain horses and mules, estimated at about 400, and whereby they leased from the syndicate for ranching purposes their ranch property in Dallam and other named counties, consisting of some 600,000 acres for a period of five years and four months, beginning January 1, 1913, and terminating May 1, 1918. The cattle, horses, and mules were purchased at certain designated prices per head, and the land was leased at 10 cents per acre per annum, payable quarterly in advance. The purchasers were to pay $50,000 cash upon the execution of the contract, $200,000 on November 1, 1912, and the balance in five equal annual installments to be evidenced by notes. The purchasers were given the right to sublet any of the lands, but were not to be relieved from the rental obligations. The syndicate was to furnish certain material for repairs upon requisition by the purchasers, and the latter were to surrender the leased property at the termination of the lease in as good condition as when delivered to them, usual wear and tear only excepted. The contract also provided for sale of the land in whole or in part, with the exception of a certain designated portion, giving the vendees the right after specified notice to terminate the lease on property so sold, in which event the rentals would be proportionately abated. The other provisions of the contract are not material to the instant controversy.

On the same day that this contract was executed, Shelton and the Triggs entered into a written agreement of partnership with reference to the property so purchased by them. This contract is set out in full in the opinion of the Court of Civil Appeals, 226 S. W. 763-765. It will only be necessary, we think, to state the substance of those portions of the contract which are relevant to the issues in controversy.

The contract provided that Shelton as first party and the Triggs as second parties were to engage as partners in the ranch and cattle business for five years from the contract's date. Shelton was given the right at any time to dissolve the partnership, sell its assets, pay its debts and distribute the proceeds; but this right to dissolve was not accorded to the Triggs. The Triggs were to contribute their work and labor under direct supervision of Shelton in handling the ranch business, taking care of the cattle and conducting the details of the business with their best skill and labor and without charge for their services. Shelton agreed to advance the $250,000 to be paid to the syndicate, and the Triggs were to execute to him their two notes for $25,000 and $100,000 respectively, the former to mature five years from date, the latter maturing 30 days from July 30, 1917, subject, however, to be matured earlier if the partnership were sooner dissolved. These notes were to be secured by chattel mortgage upon all of the interest of the Triggs in the partnership assets, and the chattel mortgage was also to secure any further advances by Shelton to the Triggs or to the partnership. Shelton was to have the sole and exclusive management of the affairs of the partnership and its property and assets over the Triggs, no property was to be sold without his consent, and his control of partnership affairs was to extend to any details in handling the partnership property, and was to be unlimited whenever he desired to execute it, even to the employment and discharge of men on the ranch; "and it is further agreed if at any time either or both of the parties of the second part shall become incapacitated by sickness or otherwise, or refuse to contribute the adequate amount of work and labor under the supervision of said party of the first part for the handling of said ranch business, or in the event of the death of either or both of said parties of the second part, said party of the first part is to have the right to employ any other man or men to take the place of said parties of the second part, at the expense and liability of said parties of the second part, or their estate, in accordance with the condition creating the necessity for such substitution." Shelton was also to have the right to wind up the partnership business upon the death of either or both of the Triggs without interference by their personal representative. Shelton was given specific authority to reduce the holdings of the partnership, sell any of the partnership property, sublease any part of the land, etc., without concurrence of the Triggs, and to sell all of the partnership property and wind up its affairs, pay its debts and retain the amount owing him by the Triggs, and distribute the proceeds to the parties entitled to them. This right he was given to exercise at any time. Shelton's right to wind up the partnership affairs was given priority over any attempted dissolution by the Triggs. Further acquisitions of partnership property were to be owned by the parties in the same manner as provided generally in the contract. Shelton was given the right, upon sale of any of the cattle, to apply the proceeds to any obligation of the partnership or any obligations of the Triggs to him or the partnership, and in event of dissolution Shelton was to have the right to distribute the net proceeds. In the event of any disagreement between the parties with reference to handling the business, Shelton was to have the final decision. Shelton, as one party, and the Triggs as the other, were to share equally in the profits and losses of the business.

On January 5, 1914, a supplemental agreement was made between the parties, which is set out in full in the majority opinion of the Court of Civil Appeals, 226 S. W. 765. This contract recited that at the time the original contract was drawn it was not contemplated that Shelton should give any considerable portion of his time and labor to the management of the business, and that since it had been agreed that D. C. Trigg be relieved from his obligation to contribute his labor to the business, and that therefore much more time and labor would be required by Shelton than contemplated, it was thereupon agreed that Shelton should be allowed a salary, to be paid out of the partnership...