Empire Finance Service, Inc. v. Western Preferred Life Insurance Co.

OPINION

WILSON, Justice.

The only question in this summary judgment appeal is whether plaintiff’s proof is sufficient to establish as a matter of law the amount of offsets to which defendant is entitled so as to show there is no genuine issue of material fact. In our opinion the proof will not authorize summary judgment, and we reverse.

Plaintiff sued on a note and a debenture. All issues concerning these instruments, except the amount due, are undisputed. Recovery by plaintiff is otherwise authorized thereon. The original petition was verified by the affidavit of plaintiff’s attorney. It made no reference to offsets, except the affidavit recited that all just and lawful offsets and credits had been allowed. Defendants’ verified answer alleged that credit had not been given for reserves, which it had been agreed would be credited; that defendant did not know the correct amount of reserves which should be credited because these were in plaintiff’s exclusive possession ; and an accounting was demanded.

Plaintiff then filed a motion for summary judgment stating defendant was entitled to credit for reserves in the net sum (after deducting claims paid and cancellations, of $3,326.56, and after adding itemized interest charges and attorney’s fees) of $37,883.64.

The motion alleged that “Plaintiff and its certified public accountant” have examined plaintiff’s records and have determined the recited information concerning reserves, which were assigned as security, and which “are to be applied against the total amounts due to plaintiff.”

There appears in the transcript an affidavit by plaintiff’s secretary-treasurer which refers to a motion for summary judgment, but it is dated nearly a year before the present motion was filed. Attached to the filed motion is an affidavit by the plaintiff’s secretary-treasurer stating that “to my personal knowledge all of the factual allegations” contained in the petition and motion “are true and correct”.

The recital in the motion that “plaintiff” has examined the records and determined the amount of reserves, of course, is a meaningless conclusion. “Plaintiff” is a corporation.

The recital in the motion that plaintiff’s “certified public accountant” has examined the records and made the determination alleged, is obviously an allegation of a conclusion based on hearsay. Hearsay and conclusion, consequently, are all the secretary-treasurer has sworn to by stating in the affidavit that the “allegations” are. true and correct.

Conclusions in the affidavit will not support a summary judgment. Finger v. St. Paul Fire and Marine Insurance Co. (Tex.Civ.App., 1968, writ ref. n. r. e.) 423 S.W.2d 460, 463; Greenville Ave. State Bank v. Lang (Tex.Civ.App., 1967) 421 S.W.2d 748 and cases cited.

The affidavit must be based on personal knowledge of affiant. Bestwall Gypsum Division, Georgia-Pacific Corp. v. Padgett Bros. Drywall (Tex.Civ.App., 1968) 425 S.W.2d 844; Dubose v. Parkdale Plaza Co. (Tex.Civ.App., 1966) writ ref. n. r. e.) 408 S.W.2d 324.

The affidavit must show affiant has personal knowledge. Youngstown Sheet and Tube Co. v. Penn (Tex.Sup.1963) 363 S.W.2d 230.

Hearsay may not be made the basis of summary judgment. Youngstown Sheet and Tube Co. v. Penn, above.

Reversed and remanded.