# American Exchange Nat. Bank of Dallas v. Keeley

> Court of Appeals of Texas · January 31, 1931 · 39 S.W.2d 929

URL: https://www.frixlaw.com/law-library/cases/9832611

## Case

- **Full name:** American Exchange Nat. Bank of Dallas v. Keeley.
- **Court:** Court of Appeals of Texas
- **Decided:** January 31, 1931
- **Citations:** 39 S.W.2d 929
- **Precedential status:** Published
- **Opinion:** On rehearing
- **Judges:** Vaughan
- **Cited by:** 20 later opinions in the Frix Law Library

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## Opinion text

'On Appellee’s Motion for Rehearing.
From this motion it is made to appear that the trial court, in instructing the jury to return a verdict in favor of appellee, was actuated by the theory on which the case was presented, not so much by appellee’s petition as by the way appellant’s defense thereto shaped and made prominent the theory that appellee’s case, as developed, rested entirely on the following allegations of his petition:
“That thereafter on October 15, 1925, and after the last said note heretofore mentioned became due, and after payment of same had been demanded by the Houston National Bank, and of the Aztec Oil Company and the endorsers,. W. H. Gray, S. T. Morgan, L. A. Carlton and R. A. Welch, said note was credited with a Five Thousand ($5000) Dollar payment. That on the same date, the plaintiff, Thomas F. Keeley, for and in behalf of- S. T. Morgan, then living, but now deceased, paid the sum of Fifteen Thousand ($15,000) Dollars to the Houston National. Bank, which was credited on the note heretofore described; that Fifteen Thousand ($15,000) Dollars was paid the Houston National Bank by the estate of L. A. Carlton, then deceased, and Fifteen Thousand ($15,000) Dollars was also paid by R. A. Welch, and the said note was, at that time, endorsed by the Houston National Bank to R. A. Welch, the estate of L. A. Carlton, deceased, and the plaintiff, Thomas F. Keeley, without recourse.
“That thereafter, tbe said 6. T. Morgan,now deceased, recovered from his then sickness, and was again restored to his health sufficiently to transact his business and manage his property, and after being advised that the plaintiff, Thomas F. Keeley, had, for and in behalf of S. T. Morgan, paid the sum of Fifteen Thousand ($15,000) Dollars on the said note, he, the said S. T. Morgan, ratified and approved the payment of said sum of money by the plaintiff, by acknowledging in writing the justness of the claim, and acknowledging in writing the payment made by Thomas F. Keeley, and approving of same, and stating and agreeing therein to reimburse and pay to the plaintiff the entire amount paid by him, together with interest thereon.”
That appellant interpreted appellee’s cause of action as being based upon a verbal promise of decedent, Morgan, made October 15, 1925, to repay him the sum of $15,000 paid by appellee to the Houston National Bank, on which said Morgan was one of four sureties, is evidenced by the fact that appellant llased its entire defense thereto upon a general denial and the two-year statute of limitation, and confined the introduction of evidence princi *934 pally in support of its plea of limitation. Ap-pellee, to remove tile bar of limitation thus pleaded and sought to be established, relied upon the three letters written by decedent, Morgan, to him, contending that same was sufficient to and did remove the bar of the two-year statute of limitation, in that same constituted an acknowledgment coupled with a promise to pay the indebtedness then claimed and to recover which this suit was filed. This is further borne out toy the following grounds contained in appellant’s motion for a new trial: “(a) Same is not supported by the pleadings, in that the plaintiff sues upon an implied promise to repay money advanced in October, 1925, while by said letters he seeks to prove and recover upon a different tract not alleged in the pleadings; (b) same is not supported by the pleadings, in'that, plaintiff sues herein upon an implied contract to repay money advanced for defendant in- October, 1925, while by said letter he seeks to set up and recover on a different contract; (c) said letter is insufficient as an acknowledgment of the debt in accordance with the requirements of article 5539, Revised Civil Statutes of Texas, 1925, for the following reasons: (1) It contains no unqualified absolute promise to pay, (2) contains no acknowledgment of the debt, (3) does not refer to or identify the alleged debt sued on herein, (4) contains an offer upon condition, (5) consists of a mere offer of compromise. ⅜ * ⅜ ”
We are to assume that appellant’s contentions in the court below were the same as in this court, and that appellee opposed same in the .trial court in keeping with some of his counter propositions presented on this appeal.
The above review of the proceedings in the court below, as reflected toy the record before us, is no doubt explanatory of the action of the trial court in instructing a verdict in favor of appellee, and of this court’s action in reversing and rendering the case on the ground that the trial court should have rendered judgment in favor of appellant based upon the issue upon which the .trial court’s peremptory instruction was predicated in favor of appellee. A careful investigation of the case, as made by pleadings and the evidence, disclosed a situation necessitating the granting of appellee's motion for rehearing, in that the following testimony clearly presented material issues of fact that should have been submitted to the jury for their determination: “That on the 23rd day of March, 1925, the Aztec Oil Company, by W. H. Gray, its president, executed and delivered to the Houston National Exchange Bank of Houston, Texas, its promissory note, in the principal sum of Fifty Thousand ($50,000) Dollars, d-ue ninety days after date, which note was secured by gold bonds of the Aztec Oil Company, being Numbers 116 to 117, inclusive, in the amount of One Thousand ($1,000) Dollars, each, and bonds Numbers 254 to 309, inclusive, in the amount of Five Hundred ($500) Dollars, each. That the said Fifty Thousand Dollar note Was endorsed in blank by W. H. Gray, S. T. Morgan, R. A. Welch and L. A. Carlton. That said note was renewed on the 21st day of June, A. D. 1925, by the execution by the Aztec Oil Company of its note in the sum of Fifty Thousand ($50,000) Dollars, payable ninety days after date, to the Houston National Bank of Houston, 'Texas, the successor in business of the Houston National Exchange Bank, which note was secured by the same bonds of the Aztec Oil Company, hereinbefore more particularly described, and was endorsed by Gray, Morgan, Carlton and Welch.”
On October 15, 1925, the note dated June 21, 1925, became due, payment was demanded by the holder thereof, the Houston National Bank, of the Aztec Oil Company, and indors-ers, Gray, Morgan, Welch, and the estate of L. A. Carlton, deceased ; that at said time the sum of $5,000 was paid on said note by the Aztec Oil Company and appellee paid the sum of $15,000, the estate of L. A. Carlton, deceased, $15,000, and R. A. Welch, $15,000, which said payments were credited on said note, and it was indorsed by the Houston National Bank, as follows: “Pay to the order of R. A. Welch, estate of L. A. Carlton, deceased, and Thomas F. Keeley, without recourse or warranty on us,” and delivered to said in-dorsees ; that, at the time said indorsement was made, appellee delivered to the Houston National Bank the following check, duly drawn and signed by him, viz.: “Continental & Commercial Trust & Savings Bank, Chicago, ’Oct. 12, 1925. Pay to the order of Houston National Bank $15,000 — Fifteen Thousand no/100 dollars. [Signed] Thomas F. Kee-ley,” on which the Houston National Bank received the sum of $15,000 and applied same as a payment on said $50,000 note; that said $50,000 note was immediately thereafter transferred and delivered by said Welch, estate of L. A. Carlton, deceased, and appellee, Keeley, to the Aztec Oil Company as per their indorsement thereon: “This note is transferred to the Aztec Oil Company, without recourse on us, in consideration of the xlztec Oil Company delivering to each of us its Fifteen Thousand ($15,000) Dollar secured notes, as partial remuneration for the- cash payment made by each of us on this note”; that, at the time said transfer was made, appellee, Keeley, received from the Aztec Oil Company, as consideration for the making of the transfer, one note in the sum of $15,000, executed by said Aztec Oil Company, payable to said appellee, Keeley, and also received from said oil company for the purpose of securing the payment of said $15,000 note, bonds of said oil company of the face value of $17,000; that, at the time of said transactions, the decedent, S. T. Morgan, was very sick, in a dangerous and critical physical condition; that the Houston National Bank, payee in said note, was demanding *935 payment of same and threatening to take necessary legal steps to enforce its collection; that appellee and said Morgan had been very friendly for thirty years as business associates; that Morgan died January 30, 1928; that the record does not show what disposition was made by appellee of said $15,000 note and bonds in the sum of $17,000, received from the Aztec Oil Company.
It is not to be gathered from the evidence, there being no degree of testimony to that effect, that decedent, Morgan, knew anything about or was ever advised by any one in reference to the transactions that were in fact had in reference to the handling and disposition made of said $50,000 note by appellee Welch and the estate of L. A. Carlton, deceased ; but, to the contrary, it appears therefrom that the transactions in refer'ence thereto were not disclosed to said Morgan. The only evidence introduced in this respect were the statements contained in the three letters written by said Morgan to appellee and the testimony of appellee’s witness Maas as set out herein and in our original opinion.
Article 5526, R. S. 1925, in part reads: “There shall be commenced and prosecuted within two years after the cause of action shall have accrued, and not afterward, all actions or suits in- court of the following description. * * ⅜ ” When can it be said that a cause of action has accrued within the meaning of said statute, becomes a material inquiry in view of the contentions of the parties litigant. In the cáse of Port Arthur, etc., v. Beaumont, etc., Mills, 105 Tex. 514 , 143 S. W. 926, 928 , 148 S. W. 283 , 150 S. W. 884 , 152 S. W. 629 , the following rule is announced: “ * * * Before it can be said that a cause of action exists in a legal sense, there must be such a mature right as may be declared upon and maintained, subject only to such valid defenses by which it may be defeated. In 25 Cyc. 1065, the rule is laid down as follows: ‘ “The accrual of the cause of action” means the right to institute and maintain a suit; and whenever one person may sue another a cause of action has accrued, and the statute begins to run.’ Again, in 25 Cyc. 1065, it is said: ‘The statute of limitation begins to run from the time when a complete cause of action accrued — that is, when a suit may be maintained — -and not until that time.’ ”
The statute of limitation, therefore, can only be put in motion under said article when the right or cause of action accrues,, and not before, and this does not exist until facts have arisen which authorize' a person assernnjrTpcraim 'to obtain relief from some court of justice against the person liable on the alleged cause of action. Stanley v. Schwalby, 85 Tex. 348 , 19 S. W. 264 ; Beach v. Wilson County, 62 Tex. 331 ; Reese v. Cobb (Tex. Civ. App.) 135 S. W. 220 ; Kansas City, M. & O. Ry. Co. v. State (Tex. Civ. App.) 155 S. W. 561 ; 37 C. J. 810, § 153.
Within itself, the voluntary payment by A of a debt due by.B, without B’s request, would not create a legal liability on the part of B to repay A the sum of money so paid for the use and benefit of B. Mings v. Griggsby Const. Co. (Tex. Civ. App.) 106 S. W. 192 ; Donaghey v. Williams, 123 Ark. 411 , 185 S. W. 778 ; Pittsburgh-Westmoreland Coal Co. v. Kerr, 220 N. Y. 137 , 115 N. E. 465 .
In order for a causé of action to accrue on account of such transaction, it would be necessary that B, with a full knowledge of same, sanction and adopt the payment made by accepting the benefits thereof. However, if such payment is sanctioned and adopted by B (debtor), he thereby makes A (payor) his agent, and the promise to refund will be implied. Ross v. Pearson, 21 Ala. 473 ; Lee’s Ex’rs v. Virginia & Maryland Bridge Co., 18 W. Va. 299 ; Neely v. Jones, 16 W. Va. 625 , 37 Am. Rep. 794 ; Wolff v. Matthews, 39 Mo. App. 376 ; Hodge v. De Laine, 137 S. C. 337, 135 S. E. 357 ; 41 C. J. 19 § 19.
Therefore, a cause of action would only accrue and legally exist on account of such voluntary payment from the date same was sanctioned and adopted by B, and the statute of limitation would only run from that date. Deaton v. Rush, 113 Tex. 176 , 252 S. W. 1025 ; Southwestern Lumber Co. v. Evans et al. (Tex. Civ. App.) 275 S. W. 1078 ; Jones County v. Moore (Tex. Civ. App.) 4 S.W.(2d) 289 ; Angelina County v. Bond (Tex. Civ. App.) 16 S.W.(2d) 338 ; Irvine v. Angus (C. C. A.) 93 F. 629 ; Goodnow v. Stryker, 61 Iowa, 261 , 16 N. W. 486 ; Pleasant Valley Hotel Co. v. Henderson, 33 Cal. App. 76 , 164 P. 420 ; Runyon v. Snell, 116 Ind. 164 , 18 N. E. 522 , 9 Am. St. Rep. 839 .
Following are the material issues that were presented by the pleadings and supported by evidence, herein set out, and that in the original opinion, which should have been but were not submitted to the jury, viz.:
(a) Whether or not appellee voluntarily advanced and paid $15.000 for decedent, Morgan, on the involved $50,000 promissory note;
(b) did decedent, Morgan, thereafter, with knowledge of all of the facts under which said $15,000 was paid, accept the benefits of same;
(c) whether or not said transaction was an investment by appellee for his own use and benefit. From this it follows as a natural sequence that, not only the court below erred in instructing a verdict to be returned in favor of appellee, but likewise1 this court committed error, not in reversing the judgment of the lower court, but in rendering judgment in favor of appellant.
Appellee’s motion for rehearing is therefore granted, and the judgment heretofore entered, reversing and rendering this cause, *936 is set aside, and, instead thereof, judgment is now rendered reversing and remanding said cause for further proceedings not inconsistent with this opinion.
Reversed and remanded.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/9832611. Public record. Not legal advice.