Guardian Trust Co. v. Bauereisen

GRAVES, Justice.

This statement from the appellant’s brief — revised in only two particulars, as suggested by the appellee — is thought to be correct:

“This suit was filed April 17, 1933, by R. J. Bauereisen, son-in-law of W. T. Eldridge, against Nueces Lands Irrigation Company, a corporation, and Guardian Trust Company, Independent Executor under Mr. Eldridge’s will, in the district court of Fort Bend County, Texas. It was tried before the court without a jury, and judgment was entered December 1, 1934, in favor of the plaintiff, and against Guardian Trust Company, in its capacity as Independent Executor under the will of W. T. Eldridge, deceased, for the sum of $40,000.00, and against plaintiff on his claim against Nueces Lands Irrigation Company.

“Appellee, the plaintiff below, declared upon two written contracts, both dated July 26, 1928, copies of which were made exhibits to his first amended original petition, upon which he went to trial. One of these contracts was executed by himself and the defendant Nueces Lands Irrigation Company, and the other by himself and W. T. Eldridge. By the terms of the first contract the Irrigation Company employed Bauereisen as its general manager, for a period of five years, beginning September 1, 1928, at a salary of $700.00 per month, and agreed to provide a house, suitable for the occupancy of Bauereisen, and his family, on the company’s property in Dimmit County, Texas. Bauereisen agreed to devote his best efforts and entire time to tile management of the affairs of the company, but the company agreed he might contract for the drilling of wells or other work in Texas if such contracts could be made and performed without causing him to neglect his duties as general manager of the company, provided he first received the written consent of the company through its president. Bauer-eiseu agreed to move his drilling rig to the company’s property in Dimmit County (he then being a resident of Chicago), and to use the same in drilling water wells on said property, and the company agreed to pay the freight and other costs of transporting the rig and tools to its property and the expense of moving his household belongings and office furniture and fixtures to Dimmit County, and to pay him at the rate of 6(⅜ for each foot drilled with said rig and $10 per day for rig work other than drilling.

“In the contract between Bauereisen and Eldridge, Eldridge agreed, as an inducement to Bauereisen to execute the contract with the irrigation company, to give him one-half of all dividends which might be declared within the next five years on stock of the company then belonging to Eldridge, or acquired by Eldridge within that time, and, subject to the other terms of the contract, guaranteed the payment to Bauereisen of the salary specified in his contract with the irrigation company. By an additional provision of said contract, Eldridge agreed further that in the event he foreclosed within said five-year period the liens which he held against the properties of the irrigation company, he would retain Bauereisen as general manager of the company and divide equally with him the net profits realized from the operation or sale of its properties during said five-year period; and that in the event he sold or assigned during said five-year period his stock in and liens against the company, or the company sold all its properties lo a third party, Bauer-eisen 'shall have the election of receiving from first party (Eldridge) the salary for the remaining portion of said five-year period at the rate of $700.00 per month, or of receiving one-half of the profit realized by first party on the transaction, first party receiving his entire investment plus 6% interest before any profit shall be considered to have been earned. Second party’s (Bauereisen’s) right to receive the salary for the remaining portion of said period upon his electing to do so upon the happening of either of the above contingencies, shall be conditional upon his devoting his time and services somewhere in the United States for the benefit of first party as first party may direct.’ Bauereisen agreed that Eldridge should receive one-half of all net profits realized during said five-year period from any operations he conducted in drilling wells or selling well equipment.

“Bauereisen alleged that after the afore-described contracts were executed, he entered upon the performance of his contract with the irrigation company and continued in its employ until April 19, 1929, and would have continued performance for the full five-year term thereof, but the company refused to perforin the contract after said date and to pay him the stipulated salary of $700.00 per month, except that by an agreement made in December, 1929, a certain sum of money was accepted by him in satisfaction of his claims which had accrued prior to June 1, 1929, without prejudice to any claims arising after that date; and the company also required him to vacate the house which he occupied on its premises and thereby compelled him to secure another at a cost of $100.00 per mouth during the remainder of the contract term. Bauereisen further alleged in substance that he had at all times been willing and ready to perform the contract with the irrigation company; that during the period since the contract had been breached he had been able to earn not to exceed $6500.00; that thereby the irrigation company had damaged him to the extent of $40,000.00; that W. T. Eld-ridge was liable to him as guarantor of the salary agreed to be paid him by the irrigation company, and that he having died August 20, 1932, and Guardian 'Trust Company having been appointed and qualified as Independent Executor under his will, it was liable to him in such capacity.”

In its first amended original answer, Guardian Trust Company, as independent executor under the will of W. T. Eldridge, deceased, appellant herein, interposed a general demurrer and general denial to the aforementioned petition, and alleged: “That on or about April 1, 1929, W. T. Eldridge sold to the Sugarland Industries all of his stock in and notes and liens against Nueces Lands & Irrigation Company and promptly thereafter notified plaintiff of such sale. Upon being notified of such sale, plaintiff elected to receive from First Party the Salary for the remaining portion of said five-year period at the rate of Seven Hundred ($700.00) Dollars per month. Said W. T. Eldridge arranged for the plaintiff to be employed in the State of Oklahoma by a corporation known as ‘Texas Fig, Inc.’, in which the said W. T. Eldridge was substantially interested, such employment to be performed by the plaintiff under and in fulfillment of a contract between the said W. T. Eld-ridge and the said Texas Fig, Inc., for which services the said W. T. Eldridge agreed to pay plaintiff the salary of $700.00 per month, in accordance with the terms and provisions of Section 4 of the contract between the plaintiff and the said W. T. Eldridge. Plaintiff, however, breached the condition of the guaranty plead by him herein and declined and refused to accept the employment and declined to devote his time and services for the benefit of the said W. T. Eldridge as the said W. T. Eldridge requested and directed. Plaintiff, therefore,, having breached and refused to perform the contract under which the guaranty was given to him by the said W. T. Eldridge forfeited and terminated all right to claim payment thereunder.”

Defendant Nueces Lands Irrigation Company not being a party to this appeal, it is sufficient to state that it pleaded in substance the same facts alleged by appellant.

In his replication to the answers of the defendants, Bauereisen admitted having elected to claim under section IV of the Eldridge contract and denied Eldridge ever offered him any employment, but merely sought to induce Texas Fig, Inc., to employ him as a fig salesman in Oklahoma; that he was not a fig or produce salesman; that he was a mechanical engineer, and had worked at his profession all his life; that Eldridge knew these facts and knew that he was unsuited for a salesman of figs or any products sold by Sugar-land Industries or Texas Fig, Inc., and that said offer of employment was not made by Eldridge in good faith, but was unreasonably and fraudulently made for the purpose of giving him a pretext for denying his liability to Bauereisen.

Both defendants specifically excepted to the allegations in.Bauereisen’s first supplemental petition to the effect that he was not a fig or produce salesman, but was a mechanical engineer, etc., because the contract between Bauereisen and Eldridge provided Bauereisen should devote his time and services somewhere in the United States for the benefit of Eldridge as said Eldridge might direct, and the qualifications, training and profession of Bauer-eisen were irrelevant and immaterial.

An order was entered by the court overruling the general demurrer and these exceptions, to which defendants duly excepted.

At the conclusion of the case, there having been no request for findings of fact or law, -the court rendered judgment in favor of Bauereisen and against appellant for the sum of $40,000, and against Bauereisen on his claim against the irrigation company.

Bauereisen did not perfect his appeal from that part of the trial court’s judgment denying him any recovery against the irrigation company, hence it remains undisturbed as entered below.

Since the two contracts declared upon are inseparable parts of the same transaction, they should be construed together, but, further, since they have been well summarized generally in the quoted statement, together with an in his verbis copy of section IV of the Bauereisen-Eld-ridge contract, they will not be herein copied in full, although copies are hereto attached as exhibits.

Appellant ably inveighs here against the trial court’s judgment, in substance, upon these main contentions:

(1) Its general demurrer to the appel-lee’s attempt to plead a cause of action against it should have been sustained, because the respective averments of his trial petitions, that is, his first amended and his supplemental, contain structurally inconsistent allegations that mutually destroyed each other, in that by the amended one he alleged the continued binding subsistence of the Irrigation Company’s employment contract, his own readiness at all times to comply with it, its breach by the company, and Eldridge’s failure upon his part to perform it; whereas, in his supplemental one, by way oí reply to appellant’s answers, he alleged the happening of the contingency contemplated by section IV of the Bauereisen-Eldridge contract, adding that upon such occurrence he had elected to claim under that clause of that contract, that is, to enter a new employment for Eldridge’s benefit and to receive his salary direct from Eldridge, and that Eldridge had violated that contract of absolute guaranty with him.

(2) That, on the undisputed evidence, inclusive of the two contracts declared upon, the court should have rendered judgment in its favor and against the appellee, because it was undisputedly developed that, pursuant to the above-described terms of the Irrigation Company’s contract, which were clear, complete, and unambiguous, with no claim of fraud, accident, or mistake in the making thereof, prior to the expiration of the specified five years’ time, Eldridge did sell his stock and liens against the Irrigation Company; that he promptly notified Bauereisen of such sale; that Bauereisen elected to receive the salary of $700 per month; that Eldridge thereupon tendered Bauereisen lawful and proper employment in the state of Oklahoma, for which he agreed to pay Bauer-eisen $700 per month; that Bauereisen refused to accept such employment or to devote his time and services for Eldridge’s benefit, unless Eldridge gave him employment as an engineer; that the employment so tendered ' Bauereisen was reasonably within the contemplation of the parties at the time the Bauereisen-Eldridge agreement was made; that Bauereisen was informed and knew at and before the time the Bauereisen-Eldridge agreement was executed that Eldridge was under the impression that in the event Bauereisen elected to receive the salary of $700 per month thereunder, Eldridge could require him (Bauereisen) “to work anywhere and and do anything Mr, Eldridge tells you to do,” and that Bauereisen expressed himself as, “I don’t care what I do, I want my salary.”

(3) That the court erred in admitting in evidence any of the telegrams and letters which passed between Bauereisen and Eldridge before the execution of the contract between those two, because all such negotiations and communications between the parties became merged in that written contract between them, which was clear on its face and not claimed to have been tainted by fraud, accident, or mistake, in the execution thereof, hence it could neither be added to, varied, nor displaced, under the rule against parol evidence.

(4) Especially was the admission of any part of Bauereisen’s letter to Eldridge of June 17, 1929, inadmissible, except Bauer⅜ eisen’s therein announced decimation to accept the position theretofore tendered him by Eldridge, because (1) the lettei' otherwise merely constituted Bauereisen’s conclusion and construction of the contract between himself and Eldridge, which on its face was clear, certain, and complete; (2) it constituted self-serving declarations by Bauereisen in his own favor.

(5) There was a complete variance between the pleadings ‘and the proof offered by the appellee, in that he pleaded a case under section II of his stated contract with Eldridge, which is one of absolute guaranty by Eldridge of the salary provisions of Bauereisen’s contract with the Irrigation Company, whereas by his proof he negatived the existence of facts necessary to support liability under the contract of absolute guaranty he had thus pleaded.

In the state of the record, it is determined that none of these presentments should be sustained; the gravamen of the argument for the general demurrer is that the appellee, while in his amended petition declaring upon the Irrigation Company’s contract to pay him the $700 per month and upon Eldridge’s guaranty thereof by the recitation in section II of of the Eldridge-Bauereisen contract, “First party hereby guarantees the payment of the salary agreed to be paid to second party by Nueces Lands Irrigation Company in said contract,” in his supplemental petition, in reply to appellant’s answers, he alleges Eldridge’s sale of his interests in the Irrigation Company, with notice thereof to himself; that upon such notice hp had elected to receive direct from Eldridge such salary for the remainder of the five-year term, declaring himself entitled to it from that source accordingly, and thereby setting up a wholly inconsistent claim with the one that he was entitled to it under Eldridge’s mere guaranty of the Irrigation Company’s obligation to pay it to him.

This position is thought to be inept, it going to the form rather than the substance of the appellee’s pleadings considered as a whole, which ordinarily is reachable by special exception rather than general demurrer; it is true that at first blush it might appear that appellee was declaring upon the obligation of the Irrigatiori Company as a still subsisting one to pay him the specified salary (and as such guaranteed by Eldridge), but, when it is’further considered that in all of his petitions he had not only sued upon these two contracts by himself (the one with the Irrigation Company and the other with Eld-ridge individually) and had made them parts thereof by attaching copies of them as exhibits, but he had also therein affirmatively declared that none of such contractors had ever paid him the $700 he therein prayed for from each and all of them; not only so, but further, in its answer to his amended petition, the appellant itself had set up section IV of the Eldridge contract that appellee had not in his amended petition specifically isolated and declared upon by himself, whereupon the appellee, in what is here regarded as a timely and appropriate response to this matter as so set up in appellant’s answers, himself therein declared that the contingencies specified in such section IV had occurred and that he had duly elected to claim thereunder, but that such provisions had all been breached by Eldridge, in consequence ■of which the latter had become directly obligated to him thereon, the learned trial court was justified — In.the absence of any objection or exception at the time that such supplement contained matter proper only by way of amendment — in construing the two pleadings of the appellee together as amounting to an abandonment by him of his declaration in the first one of Eld-ridge’s liability to him under paragraph II of their contract, and as finally intending to assert a cause of action against him (that is, his executor, the appellant) under paragraph IV of that contract; indeed, it would seem to this court in the particular circumstances that such conclusion is nothing more than a reasonable intendment of the two pleadings taken together, bridged in between as they were by appellant’s introducing by itself paragraph IV under averments to the effect that appellee had become confined to .the rights, if any 'belonging to him, under that section; by the order of the court referred to in the introductory statement, 'both of these pleadings had remained before the court until the final judgment was rendered, hence they should be considered together in determining whether or not the general demurrer was good, Glenn v. Dallas County, etc., Levee Dist., 114 Tex. 325, 268 S.W. 452, 453; it might be conceded that, had there been at the trial a motion to strike or special exception to this alleged inconsistency between the two pleadings, the trial court would have required the appellee to be more specific, Central Power & Light Co. v. Johnston (Tex.Civ.App.) 24 S.W.(2d) 762; Burger v. Ray (Tex.Civ.App.) 239 S.W. 257, 260; J. I. Case T. M. Co. v. First National Bank (Tex.Civ.App.) 160 S.W. 662; 33 Texas Jurisprudence, p. 608 et seq., Pleadings, § 163, and the authorities there cited; but, in the absence of anything of that sort, it is thought that, within the rationale of the rule stated by the Commission of Appeals in the Glenn Case, supra, the supplemental petition here should be considered “for all that it means instead of what it is called” in aid of the amended petition to the extent of finally declaring the liability claimed to have accrued under section IV of the contract alone; upon what appears to have been the legal equivalent of the same situation as obtains here the Beaumont Court of Civil Appeals so held in Beaumont Irrigating Co. v. Gregory, 136 S.W. 545. See, also, Hubb Diggs Co. v. Ft. Worth State Bank, 117 Tex. 107, 298 S.W. 419; Kelly v. Gross (Tex.Civ.App.) 4 S.W.(2d) 296.

Neither the case of Dallas, etc., R. Co. v. Redman (Tex.Civ.App.). 88 S.W.(2d) 136, nor the text of 33 Texas Jurisprudence, § 65, p. 489, both so strongly relied upon by appellant in this connection, are thought to have been grounded upon essentially the same state of facts, in that here there was no actual repugnance between positions finally insisted upon, but a mere change from one to the other through which this appellee at last abandoned any cause of action he might have had upon the guaranty provisions of his contract with Eldridge, and relied only in the end upon his sole right to the salary as given in paragraph IV of that same contract.

The vice in the second contention that, under the undisputed evidence, judgment should have been rendered in appellant’s favor, seems to this court to lie in a begging of any question about that by appellant’s assuming as a predicate therefor that Eldridge’s tender to Bauereisenof employment by another corporation of a position as a fig-salesman in Oklahoma was a full compliance with his obligation under section IV of their contract as being not only a “lawful and proper employment, but one reasonably within the contemplation of the parties at the time the Bauereisen-Eld-ridge agreement had been made”; it would certainly seem inept to contend that, with the two contracts sued on not considered, or construed differently from this quoted view of their meaning, the undisputed evidence yet required a judgment for the appellant; indeed, since these two contracts, together with the stated actions of the parties that occurred pursuant to them, constituted the major part of all the evidence, it clearly follows that these propositions cannot be sound if the contracts were susceptible of at least the construction that they are not on the face thereof reasonably within the contemplation of the parties at the time they were made; in other words, it is the view of this court that, when the relations, surroundings, and mutual knowledge of the parties with reference thereto, as well as of the conditions appertaining to what they were undertaking to do, are considered, the two writings between them were susceptible of the interpretation that they meant the time and services of Bauereisen somewhere in the United States to be reasonably in line with what they both well knew he had been then specially fitted for — that is, the work of a mechanical engineer whose main occupation was that of a driller of water wells with a rig of his own; that being so, there was ample evidence aliunde the terms of the two contracts for the support of the presumed finding by the trial court that this fig sales job offered Bauereisen by Eldridge was not a reasonable employment under the terms of their contract; in short, to repeat somewhat, they were father-in-law and son-in-law, they both then knew that Bauereisen was such an engineer, fitted only for mechanical pursuits by both education and temperament, that he had never had any experience anywhere as a fig or other crop salesman, and was not by nature cut out for that kind of employment; under that interpretation of their agreement, it follows as the night the day that Bauer-eisen’s undisputed refusal to accept employment as a fig salesman alone did not require the rendition of a- judgment adverse to him.

From what has just been said it further follows — if the construction therein given of the contract be permissible— that the question of whether or not Bauer-eisen was justified in so refusing to accept the tender of employment as a fig salesman is one of fact rather than of law, depending upon whether or npt that service so demanded of him was a reasonable one in the particular circumstances attending. Development Co. v. King (C.C.A.) 161 F. 91, 24 L.R.A.(N.S.) 812; Meyerson v. Hart (C.C.A.) 167 F. 965, 967; Price v. Mouat, 11 C.B.(N.S.) 508, 148 Eng.Rep., 895.

Upon like or kindred considerations, it is thought the admission of the complained of letter from Bauereisen to Eldridge of June 17, 1929, was not erroneous for any of the reasons appellant advances; if the contract was subject to the interpretation just indicated, rather than that Bauereisen was under its express terms (claimed by appellant to be “clear, complete, and unambiguous”) bound to accept any and every sort of employment offered to him by Eldridge “anywhere in the United States” that was tendered as being for Eldridge’s benefit, or forfeit forthwith any and all rights he might have under it — as appellant upon that as a basis further apparently contends — then this letter did not contravene the well-settled rules of evidence appellant invokes against it, but was offered solely for the purpose of showing the attending circumstances at the time and consequently what the parties meant by the language employed in their contract, consonant with the rules stated in 10 Texas Jurisprudence, § 169; in this connection it will be noted that this section IV neither defined nor specified the kind of services Bauereisen was to render merely prescribing the territorial locus of them as to be “somewhere in the United States”; wherefore, the evidence so objected to in this instance was applicable to these facts and admissible under the rule thus stated in Labatt on Master & Servant, vol. 1, p. 884, par. 288:

“Parol evidence is not admissible to show the sense in which the parties used the words of a written contract which defined the scope of the servant’s obligation in respect to work done by him. But where such a contract does not state precisely in what capacity the services are to be rendered, parol evidence is admissible to show that the duties which the servant was engaged to discharge were or were not of such a character that he was or was not justified in refusing to perform the services in question. Such evidence is explanatory of, and consistent with, the written contract, and is not objectionable as adding to its terms.”

The final insistence for a variance between the appellee’s pleadings' and his proof has in effect been answered by the conclusions stated on the other distinctive features of the cause, which, it is thought, undermine this last one also; if, as has been determined, the appellee’s pleadings did not so confine the legal limit of his declared upon cause of action to one for the violation of the claimed absolute guaranty under section II of the Eldridge-Bauereisen contract, then the rationale of this position is destroyed along with that urging such resulting effect from the ap-pellee’s two pleadings.

Indeed, upon the cause as a whole, under the views already stated, it is the opinion of this court that, there being no prejudicial errors in other respects assigned, the correctness of the learned trial court’s judgment herein depended upon whether or not it was justified in presumably finding as a fact that Eldridge’s attempt to comply with his stated obligation by directing Bauereisen to assume the duties of a traveling. fig salesman, under all the attending circumstances, was either so unreasonable or in such bad faith as justified Bauereisen in declining it on the ground that it was a breach of their contract; after reviewing the statement of facts with special reference to that issue, it is concluded that the evidence was sufficient to support, if indeed it did not require, the learned trial court to make such a finding, and in either event it will be presumed that it was made; it would serve no useful purpose to here make a resume of all the evidence heard upon that question, hence it will not be undertaken.

Pursuant to the conclusion that no reversible error has been pointed out, the judgment will be affirmed.

Affirmed, with Justice LANE dissenting..