Moore v. H. Seay & Co.

WILLSON, C. J. (after stating the facts as above). The principal contention presented by the assignments, and the only one it will be necessary to state, is that it appeared from the allegations in Seay & Co.’s petition and from the testimony that the contract be-, tween them and Moore was a gambling transaction and therefore not enforceable. As supporting the contention, Moore and the appellant bank rely on Burney v. Blanks, 136 S. W. 806, and Wolfe v. Andrews, 192 S. W. 268; while Seay & Co. rely on Heidenheimer v. Cleveland, 17 S. W. 524, and Smith v. Duncan (Com. App.) 209 S. W. 140, as supporting a contrary view. The parties, respectively, to "the contention each insist that *612 the cases relied upon by the other are plainly distinguishable from this one on their respective facts. In the Heidenheimer Case, Heidenheimer on February 1, 1SS3, sold Cleveland & Cameron 200,000 pounds of bacon at 10.85 cents per pound, to be shipped from Kansas City on a day in August, 1883, to be designated by Cleveland & Cameron, and to be paid for by the latter when they received the invoice and bill of lading covering the shipment. It was stipulated in the contract that if the price of bacon advanced before Cleveland & Cameron designated a day in August for shipping same, Heidenheimer 'should pay Cleveland & Cameron a sum representing the amount of the advance, and if the price declined Cleveland & Cameron should pay Heidenheimer a sum representing the amount of the decline. It seems that validity of the contract was not questioned because of the stipulation referred to, for the stipulation was not discussed in any of the opinions disposing of the appeals of the case. 17 S. W. 524; 11 Tex. Civ. App. 546, 32 S. W. 826; 44 S. W. 551; 92 Tex. 108, 46 S. W. 30. The contract was attached on the ground alone that it appeared from its face that a delivery of the bacon was not contemplated by the parties. This contention was overruled, and judgment establishing the validity of the contract was rendered on the finding of a jury that a delivery of the bacon was contemplated. We do not regard the case as of value as authority in the instant case. . In the Smith Case, it appeared that Duncan on November 11, 1912, sold and delivered 1,188 bales of cotton to Smith, who was to pay and did then pay him about 10 cents per pound therefor, and who agreed, if the price of such cotton advanced before March 1, 1913, to pay Duncan a sum representing the amount of such advance on a day before said March' 1, to be designated by Duncan. After-wards Duncan named November 27, 1912, when the cotton was worth more than 12 cents per pound, and his suit against Smith was to recover the difference between the sum Smith had paid and the value of the cotton at the advanced price. The Commission of Appeals held the contract to be a valid one. A difference between that case and this one, it will be noted, lies in the fact that in that one no part of the money paid by the buyer to the seller at the time of the sale was in any event to be paid back to the buyer. By ¿he terms of the contract in that case the seller was to get at least as much as the price then paid him for his cotton, and was to get more if the price of such cotton advanced before the time specified. It was a case where only one of the parties, and not both, as in the instant case, “jeopardized something" and therefore the transaction in that case was not within the definition of a wager. 20 Cyc. 921. In the Burney Case, Blanks,.by a contract made February 28, 1908, bought 133 bales of cotton of Burney to be delivered in March, 1908, and bound himself to pay and did pay Burney 10.80 cents per pound therefor. The contract contained q stipulation that if the price of such cotton should be in excess of 10.80 at any time before April 30, 1908, Bur-ney should have the right to demand that Blanks pay him the difference, and that if the price of such cotton was less than 10.80 Burney should pay Blanks the difference. The cotton was actually delivered by Burney to Blanks. It was contended there, as it is in this case, that it was the intention of the seller to sell, and of the buyer to buy, the cotton at a price to be determined by the market value thereof at a future time, and that the payment then made by the buyer of the market value of the cotton was intended merely as an advance or partial payment. In overruling the contention the Austin Court of Civil Appeals said: “There is no ambiguity in the terms of the contract by which the defendants agreed to sell to the plaintiff, and the plaintiff agreed to purchase from the defendants the cotton for a consideration of 10.80 cents per pound. The contract itself specifically specifies that as the amount of consideraion which plaintiff was to pay for the cotton, and the further stipulations contained in the contract do not in any wise modify the stipulation referred to. The other stipulations securing to each party an option to demand an additional settlement do not prescribe that the amount paid as a result of such settlement shall be any part of the consideration for the cotton. In fact, an additional settlement under the option conferred upon the plaintiff could not result in an additional payment for the cotton, because such payment would be made by the seller to the purchaser, instead of by the purchaser to the seller.” After holding that the facts that the optional features of the contract were connected with it and that the cotton was actually delivered did not relieve it of the charge that it was a wagering contract, the court said: “In appellee’s brief it seems to be conceded that in contracts of this character, if the parties have no interest in the future contingency, upon the happening of which one or the other is to be paid a sum of money, other than the interest secured to them.by the contract, then such contract is a wager, and not enforceable; but it is contended that aside from the optional feature of this contract, both parties had an interest in the subsequent value of the thing sold. We are unable to sanction that contention. The cotton having been sold by the defendants to the plaintiff, and he having paid the full consideration therefor, the defendants were not thereafter interested in- the value of the cotton. It no longer belonged to them, but to the plaintiff, who had paid the contract price for it. Hence it follows that, after the sale was made and the cotton paid for, only one, and not both, of the parties, had an interest in its subsequent value, except as *613 such interest was created by the optional feature of the contract.” In tlie Wolfe Case, Wolfe in his petition set out the contract he sued on, from which it appeared, as explained by the allegations in the petition, that on December 28, 1910, he bought 1,600 bales of cotton of Andrews at 14.39 cents per pound, and agreed that Andrews, by giving him notice, might fix the price thereof at the price prevailing at any time thereafter before March 1, 1911, he to pay Andrews the difference if the price in New Orleans was then in excess of 15.14 cents per pound, and Andrews, if he had not exercised the option given him, to pay Wolfe the difference if the price at that place on March 1, 1911, was less than 15.14 cents per pound, and then alleged, among other tilings, that the cotton was delivered to him, and that on December 29, 1910, he advanced Andrews $11S,014.99 on account thereof; that the price of the cotton was not fixed by the terms of the contract because Andrews was not willing to sell at the price then prevailing; that Andrews did not exercise the option he had to fix the price before March 1, 1911; and that on that day the cotton was worth in New Orleans $5,193.92 less than the sum he advanced on it. On the appeal prosecuted by Wolfe from a judgment sustaining a demurrer to his petition on the ground that the contract sued on was a wagering contract, the Dallas Court of Civil Appeals, affirming the judgment, said: “We are of the opinion that the contract relied on is a wagering one and one upon which no recovery can be had. In support of this holding we rely on the case of Burney v. Blanks, 136 S. W. 806, in which case a writ was denied by our Supreme Court. The principle announced therein we think clearly in point, and settles this case against appellant.” If there is a material difference between the Burney and Wolfe Cases and this one, it must lie in the fact that in those cases the sales, as determined on the appeals, were completed ones at the time the cotton was delivered, for á consideration then fixed and not dependent on the price of such cotton in the future, whereas in this one, as found by the trial court, the sale was “on consignment” under a contract in which Moore agreed to sell the cotton “outright” to Seay & Co. “on or prior to February 20, 1919.” When the testimony is looked to to see what the trial court meant by the finding, it is seen at once that he could not have meant a sale different from those in the Burney and Wolfe Cases; for in this case, as in those, the seller sold and delivered the cotton to the buyer, who bought and at the time of the delivery “paid” or “advanced” (the witnesses used both words as meaning the same thing) the price then prevailing for such cotton; and in those cases, as in this one, the parties agreed that if the price of such cotton • should advance before a named time the buyer would pay the seller the difference, and if it declined the seller would pay the buyer the difference; and in this case, as in those cases, the title to the cotton passed to the purchaser when it was delivered to him. The last statement is made in the face of the testimony of Seay' & Co.’s general manager that the title to the cotton remained in Moore after Seay & Co. 'bought it, because it appeared from his testimony and other uncontradicted testimony that the cotton was sold and delivered to Seay & Co. to use as they saw fit to use it, and that they at once, when it was delivered to them, used it to fill contracts they had with other parties. We think there is no escaping the conclusion that if the contracts in the Burney and Wolfe Cases were unenforceable because wagering contracts, the one in this case is unenforceable for a like reason. Therefore, if we follow the rulings in those cases, we must hold the contract in question here to be a wagering contract and unenforceable. The Supreme Court having refused to grant the writ of error applied for in the Burney Case, and so approved ' the conclusions reached therein, we feel bound to follow its lead, as the court did in the Wolfe Case. Hence the judgment will be reversed so far as it is against Moore and the Como State Bank, and judgment will be here rendered that Seay & Co. take nothing by their suit against them. Associate Justice HODGES does not concur in the disposition made of the appeal. He thinks the contract was a valid one, and in a separate opinion will state his reasons for thinking the judgment should be affirmed. Footnotes [1] other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes