Williams v. Walker , 290 S.W. 299 ( 1926 )

MeCLENDON, C. J.

On February 12, 1924, appellees G. C. and W. P. Walker brought suit against J. A. Williams and wife and appellant E. M. Masterson to recover against Williams and wife $3,000 as liquidated damages for breach of an oil well drilling contract, and to foreclose against all defendants a lien on dertain drilling machinery given to secure the damage item .sued for. The following day Masterson brought suit in the same court against the Walkers for title to and possession of the drilling machinery and sued out a writ of sequestration under which the property was seized. Masterson replevied the property on February 23, 1924. The two suits were consolidated and by amended petition appellees- sought to recover of Master-son the value of the sequestered property, the value of its use, interest on such value, and exemplary damages. Other 'relief, sought is not material to this appeal. Masterson, by amended pleadings, sought, to recover the property as owner thereof and in the alternative to foreclose a chattel mortgage lien thereon securing a note which Williams executed to a third party, and Masterson after-wards acquired. He also sought damages against appellees for retaining the property prior to the sequestration writ. There was a trial upon special issues and a judgment upon the jury’s answers in favor of appellees against Masterson and his replevy bond sureties for the found value of the sequestered property, less the amount of Masterson’s note. From this judgment Masterson and his sureties have appealed.

There are no formal assignments of error and the only error assigned in the motion for new trial which raises any of the questions presented in the appeal is the first ground of the motion complaining of the trial court’s action in overruling Masterson’s general demurrer to appellees’ amended petition.

The following statement of the case is sufficient to' a clear understanding of the issues now before us: Appellees made (i contract with Williams and wife, whereby the latter were to drill an oil well on property of the former to a depth of not less than 3,000 feet for a certain recited consideration. The. contract stipulated $3,000 as liquidated damages in ease of failure by the Williams to comply with their part of the contract. It also gave to appellees a lien upon the machinery placed upon the premises and used in drilling operations to secure the performance of the contract. The machinery was already subject to a prior chattel mortgage given by Williams to secure a note, which latter had been acquired by Masterson. The balance due on this note was $1,000 principal, 8 per cent, interest thereon from*June 22,. 1923, and 10 per cent, attorney’s fees. Williams placed certain machinery on the premises and drilled to a certain depth, less than the 3,000 feet, however, and then abandoned the contract. Ap-pellees claimed that Williams thereafter turned over the machinery in question to them in satisfaction of their claim for damages for breach of the contract. Masterson claimed that Williams had turned over the machinery to him in satisfaction of the chattel mortgage debt. The special issues submitted to the jury and their findings thereon follow:

“(1) Did Williams voluntarily abandon their contract, or were they forced to do so by acts and threats of Walker? Answer: Voluntarily.

“(2) Did Williams deliver all their property on plaintiff’s land to Walker in payment of damages? Answer: Yes.

“(3) What was the reasonable market value of all the property removed from plaintiff’s land by • Masterson at the time said property was removed? Answer: $4,000.

“(4) Did Williams deliver the oil-drilling property to Masterson in satisfaction of the note? Answer: Yes.

“(5) To whom did Williams first make delivery of property? Answer: Walker.

“(6) If No. 5 is answered that delivery was first made to Masterson, then the jury are asked to answer what damages, if any, Masterson suffered by being unable to get possession of same.”-

Upon these findings the court awarded judgment in favor of appellees against Mas-terson and his replevy bond sureties in the sum of $2,828.89, with 6 per cent, interest thereon from February 13, 1924. This figure was arrived at by deducting from the $4,000 found by the jury to be the value of the machinery at the time of its removal under replevy bond, the principal of the Masterson note, $64.65 interest thereon, and 10 per cent, attorney’s fees on said total amount, in all $1,171.11.

Appellants’ first proposition, which complains of overruling Masterson’s general demurrer to appellees’ amended petition is predicated upon the proposition that the petition seeks damages based upon the value of the property at the time the sequestration writ was issued, and not such value either at the time of the execution of the replevy bond or at the time of the trial as provided in ' Revised Statutes 192-5, art. 6857. This proposition is overruled. In paragraph 8 of plaintiffs’ petition they set out the value of the property and allege that such was its value at the time and place of the wrongful acts on the part of Masterson thereinafter alleged. They further allege that the sequestration writ, the replevy, and subsequent conversion of the property were all wrongful. The petition is manifestly sufficient to recover upon the basis allowed in the statute cited.

By’ the second proposition, appellants contend that the judgment of the trial court is not final because it does not dispose of Masterson’s cross-action for damages against appellees for alleged wrongfully withholding the property prior to the sequestration writ. It will be observed that special issue No. 6 covering this phase of the case was submitted to the jury only in case the answer to issue No. 5 should be that Williams first made delivery of the property to Masterson. The answer to special issue No. 5 was that the property was first delivered to Walker, and consequently there was no answer to special issue No. 6. The case was unquestionably tried and submitted to the jury upon the theory that, if Walker first acquired title to the property from Williams, there could be no claim by Masterson for damages against the Walkers for its retention. There was no objection to the issues submitted, or to the form in which they were submitted, and the answer of the jury to the fifth special issue disposes in effect of Masterson’s cross-action for damages, and it went out of the case by that finding. The fact that the judgment does not expressly dispose of the cross-action is immaterial. The effect of the judgment of which the special issues form the basis is to dispose of the cross-action, in that a judgment for damages against Masterson for wrongful conversion of the property necessarily negatived the right of Masterson to recover for its alleged wrongful detention by appellees. This holding is supported by Medearis v. Buratti (Tex. Civ. App.) 275 S. W. 617, and authorities there cited.

Fundamental error is alleged in several propositions on the ground that special issue No. 3 submitted the reasonable market value of the property at the time it was removed instead of at the time sequestration bond was executed or of the trial, and on the ground that there is no evidence in the record as to the value of the property at the time the sequestration bond was executed or at the time of the trial.

Appellants’ brief does not advise us of any difference in value at the time of removal of the property and at the time the sequestration bond was executed. There was no objection to special issue No. 3 as submitted and no objection to any of the testimony introduced. Nor is there any showing in appellants’ brief, nor so far as we have found in the record, of any injury to appellants in submitting the issue in this form. We doubt whether we are at liberty to consider the questions thus raised as fundamental error. Masterson and his sureties were liable to ap-pellees under the jury’s finding for the value of the property at one of the times provided in the statute cited. If an incorrect measure of damages was submitted, it was incumbent upon appellants to file objections to the charge submitting it, and, in the absence of such objections, it cannot be subsequently urged. We overrule these assignments.

It will be observed that the judgment assesses the damage as of the 13th of February, 1924. The calculation of interest on the Masterson note is to April 12, 1924, and the amount thus arrived at is deducted from the $4,000 found by the jury. Interest is awarded on the net amount thus arrived at at the legal rate of 6 per cent, per annum from February 13, 1924. Fundamental error is assigned upon this action of the court, which we sustain to the extent of the following holdings:

1. The amount due on the note is calculated to beyond February 24, 1924, the date the replevy bond was executed, and no complaint could be urged by appellees to this action.

2. No interest can be awarded on the net amount of appellees’ recovery from the date of the replevy bond’s execution to the date of judgment, for the reason that no interest was found by the jury as damages. See Davis v. Morris (Tex. Civ. App.) 257 S. W. 328, and authorities there cited. This case was affirmed on this question on writ of error to the Supreme Court. 272 S. W. 1103.

3. Appellants contend that the amount of the note .cannot be offset against the value of the converted property as of the date of the conversion, but that the offset must be made as of the date of the judgment. This rule would be correct were it not for the fact that the property converted was subject to a chattel mortgage to secure payment of the Masterson note. In such circumstances the authorities seem quite uniform in holding that a conversion of the mortgaged property operates as a satisfaction of the mortgage debt to the extent of the value of the converted security. See 11 Corpus Juris, p. 686, § 465, and notes 26 and 27, and authorities therein cited.

As the errors of the court thus pointed out were not called to the attention of the trial court, the costs of appeal should be assessed against appellants. See Merryman v. Bank (Tex. Civ. App.) 288 S. W. 840, and authorities there cited.

The trial court’s judgment is reformed so as to award appellees’ recovery against Mas-terson and his replevy bond sureties in the sum of $2,828.89, with 6 per cent, interest thereon from November 4, 1925, the date of the trial court’s judgment, and all costs of all courts, and, as so modified, and in all other respects, it is affirmed.

Reformed and affirmed.