McKamey Bros. v. Jones

COBBS, J.

This suit was brought by ap-pellee to recover damages for a breach of contract, resulting in a verdict in favor of appellants for the sum of $1,161.17. Appellants entered into a contract with appellee, whereby the latter was to sell the former 170 shares of the capital stock of the Bay Trading Comjpany of the par value of each share, $100, and delivering in exchange therefor 212 acres of land in Red River county, Tex., on which there was a mortgage to secure $2,000, assumed by appellants. This sale carried with it all property, real and personal, notes, accounts, and choses in action of Bay Trading Company, unless there was some exception and reservation.

Appellees were to render to appellant a statement of .the assets and liabilities of Bay Trading Company, that the notes and accounts due to said Bay Trading Company were to be invoiced at 60 cents on the dollar of their face value, and all notes and accounts which were assets were to be included as assets not barred by the statute of limitations, or not otherwise in legal shape for collection regardless of the solvency of said parties owing same, or whether barred by the statute of limitations. The stock and other tangible assets were to be valued at their original cost, and from aggregate assets there was to be deducted the liabilities of said Bay Trading Company, the balance to represent the net assets of the company as a basis to arrive at the value of the stock.

It was agreed that appellants were to have 40 days from December 31, 1915, to place the notes and accounts invoiced by them in a legal and collectable shape. The solvency of such debtors was not to be guaranteed. It was claimed in the list of itemized claims that the sum of $2,267.80 was worthless and barred by the statute of limitations; that said list of notes and accounts was never put in collectable shape, and appellants thereby misled appellee and 'caused him to pay an amount in excess of the true value of the stock. It was also alleged by plaintiff that all the notes and accounts mentioned in Exhibit A were worthless and barred by the statute of limitations, and so known to be when defendants invoiced them, and in- no manner assets at the time invoiced; that defendants have failed to furnish any data by which he could find the notes and accounts, and the invoice and statement in many respects untrue. Some items were placed at a greater price than the cost, and some did not exist at all or were not the property of the company, and plaintiff relied on the truth and correctness of said invoice and statement which invoiced the assets and which was false and untrue in certain respects.

[1] There are a. number of issues raised, submitted, and assigned as error, but this case must turn upon the question of law raised by assignments of error as to the sufficiency of the charge of the court in submitting the issue for measuring damages to the jury. It will be noted from the foregoing there was no rule agreed upon as to how the insolvency of any one owing the company, or in other respects lost to the company as assets, was to be ascertained, or how it would be treated in case such contributed to reduce the par value of the stock by failing to put the claims in a collectable form, or otherwise, in such case how the damages were to be assessed, since the solvency of such debtors was not guaranteed in the transaction.

The court instructed the jury to find, if there was a contract for the purchase bv plaintiff of 170 shares of the capital stock cf Bay Trading Company, and whether or not either one of the defendants violated the same, and, if, so, in special issue 3, charged, “Do you find that .the plaintiff has been damaged by reason of the failure of defendants or either of them to comply with said contract?" to which the jury answered, “Yes.” In special issue, No. 4 the court charged the jury, “In what sum of money was plaintiff damaged by reason of such failure?” and the jury answered, “$1,244.62.” Defendant excepted to the charges given, and asked two special charges. The first was:

“If you answered ‘Yes’ in response to special issue No. 3, then you are instructed, in response to special issue No. 4, to state no sum in excess of $442.33.”

This charge assumes a liability. Special charge No. 2 is to the effect:

“That the measure of damages, if any you find in this case, is the difference in the value of the 170 shares of the capital stock of the Bay Trading Company with said notes and accounts mentioned * * * placed in a legal .and collectable shape within the 40 days alleged and the value of said 170 shares with the said notes and accounts in the shape and condition same were in at the end of said 40 days.”

Special charge No. 1 .excludes liability on the plea with respect fb the notes and accounts, on the theory that there was no proof of damages with regard thereto, applying the measure of damages deemed by appellants to be the correct one. In special charge No. 2, appellants tried to submit what they conceive to be the correct measure of damages. We conclude that under the plaintiff’s pleadings the appellants’ theory as to measure of damages is correct, and that the court erred in not giving special charge No. 1 for the reason that no damages legally recoverable were proven for failure to comply with the agreement to put said notes and accounts in collectable shape; that is, in such condition that limitation could not be successfully pleaded against them. Of course, if there had been evidence of such damages, it would have been proper to refuse special charge No. 1 and give special charge No. 2.

The evidence and the findings of the jury establish the breach. For failure to comply with this undertaking, how and in what respect was there any damage? Why were not the notes and accounts collectable, without being put in what is called “collectable” shape? There was no guaranty shown as to( solvency, and no pleading and proof showing how any injury resulted from such failure. At any rate, the court’s charge did not define the correct rule to ascertain damages in this case. If appellee sustained any injury or loss by reason of such failure to collect any one of such claims that would have been collected, had they been put in a “collectable” form within the 40 days, was the important issue in this case. 'We do not think the issues submitted by the court were sufficient. The defendants had the right to have the measure of damages more definitely given when requested. It is the fairer practice to instruct the jury clearly and pointedly, and to give definite instructions on the measure of damages on the issues and facts in the particular case. H. & T. C. R. R. v. Nixon, 52 Tex. 25; Railroad Co. v. Le Gierse, 51 Tex. 204.

In the view we take of this case, it is not necessary to discuss the remaining assignments of error, and they are overruled.

The judgment of the trial court 5s reversed, and the cause remanded for a new trial.

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