Zapp v. Spreckels

• Decision Date: 07 March 1918
• Docket Number: (No. 7555.)
• Parties: ZAPP v. SPRECKELS.
• Court: Texas Court of Appeals

204 S.W. 786

ZAPP v. SPRECKELS.

(No. 7555.)

Court of Civil Appeals of Texas. Galveston.

March 7, 1918.

Rehearing Denied June 27, 1918.

Appeal from Fayette County Court; George Willrich, Judge.

Suit by J. C. Spreckels against Mrs. Isolda Zapp. Judgment for plaintiff, and defendant appeals. Affirmed.

L. D. Brown, of La Grange, for appellant. John T. Duncan, of La Grange, for appellee.

GRAVES, J.

On a former day of this term this cause was affirmed without written opinion, and motion for rehearing overruled, but, in response to the very earnest motion of appellant heretofore granted, written statement of the ground upon which that disposition was made is now filed. The essentials of the case may be thus stated:

On the date therein named Mrs. Zapp executed the following contract for the purchase of stock in the insurance company it designates:

"No. 1039. Authorized Capital, $2,000,000.00. No. Shares, 10. Subscription Contract to Increased Capital Stock of Southern National Insurance Company, Austin, Texas.

"Whereas, Southern National Insurance Company is a fire insurance corporation organized and incorporated under the laws of the state of Texas, with a paid-up capital stock of $120,000.00; and

"Whereas, it is proposed to increase the capital stock of said company in accordance with the provisions of the laws of the state of Texas; and

"Whereas, said company has engaged Charles St. Clair, of Austin, Tex., as fiscal manager to sell said increase of capital stock:

"Now, therefore, I, Isolda Zapp, of Fayetteville, hereby subscribe for ten shares of the said capital stock of the par value of $100.00 each, said stock to be fully paid up and nonassessable, and I agree to pay therefor $200.00 per share as follows: $50.00 per share to be paid to said Charles St. Clair in cash on date of this subscription to be appropriated by him as compensation to him for sale and distribution of stock hereby subscribed for. * * *

"Said company alone has the right to accept or reject this subscription contract. If accepted, amount of $50.00 specified above as paid in cash to said Charles St. Clair on date hereof shall be considered duly earned by him, and not to be refunded to me under any conditions. If rejected, total payments made on date hereof shall be returned to me, no conditions or agreements other than those printed hereon shall be binding on any party hereto.

"Dated and signed at Fayetteville this the 13th day of November, 1911.

                  "[Signed]              Mrs. Isolda Zapp
                  "Chas. St. Clair, Agent."
                

In lieu of cash, which she did not have on hand, Mrs. Zapp signed and delivered with the contract her three promissory notes for the $2,000 called for in the purchase of the ten shares at $200 per share, two of them for $500 each, and one for $1,000, the one here involved being the first $500 note due six months after its date and payable to Charles St. Clair. The insurance company duly accepted the contract and delivered the note last mentioned to St. Clair, who soon thereafter, and before its maturity, sold it to appellee, J. C. Spreckels, for $475. When the note matured, Mrs. Zapp refused payment, and Spreckels brought this suit thereon.

Trial before a jury was had, and at the close of the evidence the court peremptorily instructed a verdict for Spreckels for the amount of the note, interest and attorney's fees, which being returned, judgment was accordingly entered against Mrs. Zapp, from which she presented this appeal.

It will be noted the contract does not state when the stock was to be issued and delivered, but appellant pleaded, and the undisputed proof showed, that she never paid anything on the stock, nor was any ever delivered to her; furthermore, the evidence is equally undisputed that no stock was to be delivered until the three notes had first been paid.

The insurance company finally went into liquidation, which did not occur, however, until about one year after this suit had been filed upon the first one of Mrs. Zapp's notes; the other two having then been past due for practically the same period.

The judgment is first assailed upon the contention that the transaction represented by the quoted contract and the note sued upon "was a straight out sale of stock of the corporation for $2,000 worth of notes, and was not a subscription for stock and deferred payments, evidenced by notes, and was...