File: 061421F - From documents
transmitted: 04/25/2008
AFFIRMED;
Opinion Filed April 25, 2008.
In The
Court of Appeals
Fifth
District of Texas at Dallas
............................
No. 05-06-01421-CV
............................
W.R. EDWARDS, JR., Appellant
V.
MID-CONTINENT OFFICE
DISTRIBUTORS, L.P. AND
INWOOD OFFICE
FURNITURE, INC., Appellees
.............................................................
On Appeal from the 95th Judicial District
Court
Dallas County,
Texas
Trial Court Cause No.
04-10655-D
.............................................................
OPINION
Before Justices Lang,
Lang-Miers, and Mazzant
Opinion By Justice
Lang-Miers
W.R. Edwards, Jr. appeals
the trial court's judgment for appellees, Mid-Continent Office Distributors, L.P. and Inwood Office Furniture,
Inc., following a bench trial on a claim for money had and received. For the
reasons that follow, we affirm.
Background
The trial
testimony showed that Edwards was a member of an informal lending cartel. He met Matthews through a mutual cartel acquaintance
and subsequently loaned him $10,000. Matthews repaid that loan on time. A few
months later, Matthews approached Edwards seeking another loan. He told Edwards
that his company, MAC Group, L.L.C. (collectively Matthews or MAC), a furniture
broker, needed to borrow money in connection with three of its customer orders.
He explained that three customers placed furniture orders with MAC, each gave
MAC a fifty percent deposit, but his suppliers would not deliver the furniture
until MAC paid them the full amount. Matthews proposed to sell the receivables
for these customers to Edwards at a discounted value if Edwards would agree to
pay off the suppliers so the furniture could be delivered. Together, Matthews
and Edwards drafted a “Factoring Agreement” which reflected the terms of their
agreement. It listed the three customers, with total payments owed to MAC of
approximately $70,000.00; and seven suppliers to whom MAC owed a total of
$62,052.93, including $28,272.22 to Mid-Continent, a furniture wholesaler, and
$15,292.34 to Inwood, a furniture manufacturer.
At Matthews' request,
Edwards called Pat Henin, an operations manager at Mid-Continent, to verify the amount MAC owed. The telephone conversation
lasted five minutes or less, and there is conflicting testimony about what was
said. However, Edwards testified that Henin confirmed the balance MAC owed and
that he understood her to say Mid-Continent was holding
orders for these MAC customers until it received full payment.
See Footnote 1
Based on this conversation, Edwards did not think he needed to call Inwood or
the other suppliers to confirm that they were also
holding orders for these MAC customers, See Footnote 2
and he signed the Factoring Agreement, agreeing to purchase MAC's receivables.
He obtained a cashier's check for $28,272.22 payable to Mid-Continent and
authorized Matthews to pick up the cashier's check and hand deliver it to
Mid-Continent. The cashier's check contains the notation
“MAC 908.” See
Footnote 3
Edwards also wrote personal checks on his Schwab account to the remaining
suppliers, including a check to Inwood for
$15,292.22. See
Footnote 4
All of those checks contained the notation, “MAC Group Payment,” in the “For”
line.
Matthews wrote letters to
the three MAC customers advising them that their accounts had been sold to Edwards and to forward their payments to
Edwards. When Edwards did not receive their payments, he called them to find out
why they had not paid him. The customers told him they never received the
furniture. Edwards then called Matthews. Matthews admitted he deceived Edwards
and told him the payments Edwards made to the vendors were for past-due balances
on orders for other customers, not the customers whose receivables Edwards
purchased.
Edwards sued
Mid-Continent and Inwood for damages. See Footnote 5
The parties waived a jury and tried the case to the court. Edwards contended
that he paid the money to Mid-Continent and Inwood by mistake “based [on] a
fraudulent representation of another party” and appellees owed him the money he
had paid them. The trial court disagreed and entered a take-nothing judgment in
favor of Mid- Continent and Inwood. It subsequently issued findings of fact and
conclusions of law. In two issues on appeal, Edwards specifically challenges the
legal and factual sufficiency of certain of the trial court's findings of fact.
He contends that he proved the claim for money had and received against
appellees and the trial court erred by granting a take-nothing judgment against
him.
Standard of Review
Appellant complains about
the findings of fact issued by the court to support its judgment denying his claim for money had and received. However, a review
of the findings of fact in this case does not end our inquiry. Instead, we
review those findings in the context of whether they support the judgment
denying him relief. Those reviews involve overlapping standards of review. See Footnote 6
The claim for
money had and received seeks equitable relief. See Stonebridge
Life Ins. Co. v. Pitts, 236 S.W.3d
201, 203 n.1 (Tex. 2007) (per curiam); Acoustical Screens in Color, Inc. v.
T. C. Lordon Co., Inc., 524 S.W.2d 346, 350 (Tex. Civ. App.-Dallas 1975,
writ ref'd n.r.e.). And a trial court exercises broad discretion in balancing
the equities involved in a case seeking equitable relief. See In re
Gamble, 71 S.W.3d 313, 317 (Tex. 2002) (orig. proceeding); Craddock v.
Sunshine Bus Lines, Inc., 134 Tex. 388, 393, 133 S.W.2d 124, 126 (1939). We
will not disturb a trial court's ruling on a claim seeking equitable relief
unless it is arbitrary, unreasonable, and unsupported by guiding rules and
principles. See Cire v. Cummings, 134 S.W.3d 835, 838 (Tex. 2004).
When a trial court makes written findings of fact following a non-jury trial,
these assist in our review of the trial court's exercise of its discretion by
revealing the trial court's reasoning and analysis and help assure both the
reviewing court and the litigants that the trial court's decision resulted from
thoughtful deliberation. See Williams v. Chisolm, 111 S.W.3d 811, 815
(Tex. App.-Houston [1st Dist.] 2003, no pet.). If the evidence is sufficient to
support the trial court's findings and conclusions, the trial court did not
abuse its discretion. See Reese v. Duncan, 80 S.W.3d 650, 569 (Tex.
App.-Dallas 2002, pet. denied); El Paso County Hosp. Dist. v. Gilbert, 64
S.W.3d 200, 203-04 (Tex. App.-El Paso 2001, pet. denied).
We review
challenges to the sufficiency of the evidence to support findings of
fact under the same standards for reviewing
evidence to support a jury's verdict. Walker v. Cotter Prop., Inc., 181
S.W.3d 895, 899 (Tex. App.-Dallas 2006, no pet.). In evaluating the legal
sufficiency of the evidence to support a finding, we must determine whether the
evidence as a whole rises to a level that would enable reasonable and
fair-minded people to differ in their conclusions. Columbia Med. Ctr.
Subsidiary, L.P. v. Meier, 198 S.W.3d 408, 414 (Tex. App.-Dallas 2006, pet.
denied) (citing City of Keller v. Wilson, 168 S.W.3d 802, 822 (Tex.
2005)). Anything more than a scintilla of evidence is legally sufficient to
support a challenged finding. Walker, 181 S.W.3d at 899. When we review a
finding for factual sufficiency, we consider all of the evidence and will set
aside a finding only if it is so contrary to the overwhelming weight of the
evidence as to be clearly wrong and unjust. See Dow Chem. Co. v.
Francis, 46 S.W.3d 237, 242 (Tex. 2001) (per curiam); Cain v. Bain,
709 S.W.2d 175, 176 (Tex. 1986) (per curiam). And we review a trial court's
legal conclusions de novo. See Walker v. Anderson, 232 S.W.3d 899,
908 (Tex. App.-Dallas 2007, no pet.). We evaluate those conclusions
independently to determine whether the trial court correctly drew the conclusion
from the facts. Id. Unchallenged findings of fact are conclusive on
appeal unless the contrary is established as a matter or law or there is no
evidence to support the findings. Toles v. Toles, 45 S.W.3d 252, 265 n. 6
(Tex. App.-Dallas 2001, pet. denied) (citing McGalliard v. Kuhlmann, 722
S.W.2d 694, 696 (Tex. 1986)).
Consequently, we first
determine whether the evidence is sufficient to support the challenged findings and then determine whether the trial court's
judgment-as a decision of a claim seeking equitable relief-is arbitrary,
unreasonable, or unsupported by guiding rules and
principles.
Claim for Money Had and
Received
Edwards contends that he
established each element of his claim for money had and received. As we noted, a cause of action for money had and received
is equitable in nature. Stonebridge Life Ins. Co., 236 S.W.3d at 203 n.1;
Acoustical Screens in Color, Inc., 524 S.W.2d at 350. The claim “belongs
conceptually to the doctrine of unjust enrichment.” Amoco Prod. Co. v. Smith, 946 S.W.2d 162, 164 (Tex. App.-El
Paso 1997, no writ). See
Footnote 7
The doctrine of unjust enrichment applies the principles of restitution to
disputes that are not governed by a contract between the parties. Id. It
characterizes the result of a failure to make restitution under circumstances
that give rise to an implied or quasi-contractual obligation to return those
benefits. Id.
The courts describe this
claim in general principles. For example, courts have stated that a claim for money had and received seeks to restore money
where equity and good conscience require restitution, see id.; it
is not premised on wrongdoing, but seeks to determine to which party, in equity,
justice, and law, the money belongs, Staats v. Miller, 150 Tex. 581, 584,
243 S.W.2d 686, 687 (1951); and it seeks to prevent unconscionable loss to the
payor and unjust enrichment to the payee. Bryan v. Citizens Nat'l Bank in
Abilene, 628 S.W.2d 761, 763 (Tex. 1982). As these broad and general
descriptions demonstrate, a cause of action for money had and received is “less
restricted and fettered by technical rules and formalities than any other form
of action. It aims at the abstract justice of the case, and looks solely to the
inquiry, whether the defendant holds money, which . . . belongs to the
plaintiff.” Staats, 150 Tex. at 584, 243 S.W.2d at 687-88 (internal
quotations and citations omitted). To prove the claim, a plaintiff must show
that a defendant holds money which in equity and good conscience belongs to him.
See Best Buy Co., Inc. No. 07-0028, 2007 WL 4216615 at *2 (Tex. Nov. 30,
2007) (per curiam) (citing Staats, 150 Tex. at 584, 243 S.W.2d at 687). A
defendant may present any facts or raise any defenses that would deny a
claimant's right to recover under this theory. Id. at *2 (citing
Stonebridge, 236 S.W.3d at 205-06 and Staats, 150 Tex. at 584, 243
S.W.2d at 687).
Texas courts have allowed
restitution for these types of claims in a variety of cases: by a defrauded party against the party who committed the fraud,
see Staats, 150 Tex. at 583-85, 243 S.W.2d at 686-88; Wiseman v.
Baylor, 69 Tex. 63, 64-66, 6 S.W. 743, 743-44 (Tex. 1887); by a party that
made an overpayment, Benson v. Travelers Ins. Co., 464 S.W.2d 709, 710-13
(Tex. Civ. App.-Dallas 1971, no writ); and by a party that paid or credited
money to the wrong person or account, see Amoco Prod. Co., 946
S.W.2d at 163-65 (payment to wrong person); Doss v. Homecomings Fin. Network,
Inc., 210 S.W.3d 706, 710-11 (Tex. App.-Corpus Christi 2006, pet. denied)
(payment applied to wrong account); Lyman D. Robinson Family Ltd. P'ship v.
McWilliams & Thompson, P.L.L.C., 143 S.W.3d 518, 520 (Tex. App.-Dallas
2004, pet. denied) (earnest money released to wrong client).
Conversely,
some Texas courts have rejected a claim for restitution and held that money paid under a unilateral mistake of fact cannot be
recovered. See, e.g., Pacific Molasses Co. v. Graves, 451 S.W.2d
294, 298 (Tex. Civ. App.-San Antonio 1970, writ ref'd n.r.e.); Sellman v. Am.
Nat'l Ins. Co., 281 S.W.2d 150, 154 (Tex. Civ. App.-Texarkana 1955, writ
dism'd). And other courts have held that as between two innocent parties, the
party that must suffer the loss is the one that mistakenly created the situation
and was in the best position to have avoided it. See Holden Bus. Forms
Co. v. Columbia Med. Ctr. of Arlington Subsidiary, L.P., 83 S.W.3d 274, 278
(Tex. App.-Fort Worth 2002, no pet.) (self-insured employer denied restitution
of insurance benefits paid to hospital before employer discovered claim not
covered by plan); Lincoln Nat'l Life Ins. Co. v. Rittman, 790 S.W.2d 791,
794 (Tex. App.-Houston [14th Dist.] 1990, no writ) (insurer denied restitution
of benefits paid to hospital after coverage terminated); Lincoln Nat'l Life
Ins. Co. v. Brown Schools, Inc., 757 S.W.2d 411, 415 (Tex. App.-Houston
[14th Dist.] 1988, no writ) (same).
In some cases, the trial
court's ruling was reversed because the intermediate court of appeals concluded that the trial court abused its discretion in
affording equitable relief. See, e.g., London v. London, 192
S.W.3d 6, 13-14 (Tex. App.-Houston [14th Dist.] 2005, pet. denied) (trial
court's order denying father's claim for money had and received reversed on
ground that evidence sufficient to support claim for equitable restitution
because child support payments were made pursuant to court order later reversed
on appeal); Austin v. Duval, 735 S.W.2d 647, 649-50 (Tex. App.-Austin
1987, writ denied) ( trial court's judgment that holders of lapsed option
contract entitled to restitution of earnest money reversed because earnest money
forfeited under express terms of option contract); Singer v. St. Paul Mercury
Ins. Co., 478 S.W.2d 579, 583 (Tex. Civ. App.-San Antonio 1972, writ ref'd
n.r.e.) (trial court's judgment in favor of insured reversed because insurer
issued stop-payment order on check when determined no coverage). See also
Pope v. Garrett, 147 Tex. 18, 24-25, 211 S.W.2d 559, 561-62 (1948) (court of
appeals' judgment that constructive trust should not be impressed upon interests
of defendants who did not participate in wrongful act reversed by supreme court
because, but for wrongful acts, innocent defendants would not have inherited
property).
The common thread in
these decisions is that they are all dependent upon a balancing of the equities in each unique case.
Discussion
In two
issues, Edwards contends that he established each element of his claim
for money had and received. The first issue
addresses the evidence relating to Inwood, and the second issue addresses the
evidence relating to Mid-Continent.
He first contends
that the evidence is insufficient to support factual findings 17, 18, 19, and 23
See Footnote 8
insofar as those findings state that Inwood shipped furniture orders to MAC
after it received Edwards's check. He also contends that the evidence is
insufficient to support factual finding 24, which states, “The time delay of
over four months from Plaintiff's payment to his claim for return of the funds
caused Defendant Inwood to be deprived of other possible remedies to its
detriment.” And in his second issue, Edwards challenges the sufficiency of the
evidence to support finding of fact 5, a similar finding insofar as it finds
that Mid-Continent received product for the third order on July 29, 2003, but
would not deliver this order until Matthews paid all outstanding sums owed to
Mid-Continent. Edwards contends that the lack of evidence to support the
challenged findings shows that Mid-Continent and Inwood did not prove that they
detrimentally relied on his payments. Edwards also appears to argue that without
sufficient evidence to support these factual findings, there is no evidence to
support the trial court's conclusion that he did not meet his burden of
proof.
We have reviewed
the record and agree with Edwards that the evidence is legally insufficient to show that Inwood shipped furniture orders to MAC
after Inwood received Edwards's check; that Inwood was deprived of other
possible remedies by the delay in Edwards seeking a refund; and that
Mid-Continent received product for the third order in July 2003, but would not
ship the order until Matthews made payment in full. However, we disagree that
the insufficient evidentiary support for these findings leads to the
determination that there is no support for the trial court's conclusion that
Edwards did not meet his burden of proof.
First, Edwards does not
cite, and we have not found, a case stating that a defendant must show detrimental reliance to defeat recovery. And the
cases he cites do not apply in an action for money had and received, or are
distinguishable. See, e.g., Bryan, 628 S.W.2d at 761-64
(reconciling common law right to restitution with provisions of business and
commerce code to lawsuit by bank to recover funds paid over stop-payment order);
Monarch Marking Sys. Co. v. Reed's Photo Mart, Inc., 485 S.W.2d 905,
905-07 (Tex. 1972) (action for rescission of contract based on unilateral
mistake); Nat'l Indem. Co. v. Spring Branch State Bank, 162 Tex. 521,
522-27, 348 S.W.2d 528, 528-31 (Tex. 1961) (adopting “federal” or “equitable”
rule relating to bank's use of depositor's funds); Am. Nat'l Ins. Co. v.
Gifford-Hill & Co., Inc., 673 S.W.2d 915, 916-22 (Tex. App.-Dallas 1984,
writ ref'd n.r.e.) (interpretation of loan agreement
relating to allegation of unilateral mistake). See Footnote 9
Consequently, the absence of proof of detrimental reliance by appellees does not
assure Edwards's recovery. Instead, detrimental reliance is one of the factors
that a trial court considers in balancing the equities in a claim for money had
and received. See Best Buy Co., 2007 WL 4216615 at *2 (concluding that
defenses of actual knowledge and unclean hands are not matters of avoidance but
instead relate to equities necessary to determine liability in the first
instance).
Additionally, as the
claimant, it was Edwards's burden to prove that appellees held money which in equity and good conscience belonged to
him. See id. Because the court concluded that he did not fulfill his
burden, we must determine whether the court abused its discretion in making that
decision.
It is undisputed that
appellees held money. But the issue is whether Edwards also proved that the money, in equity and good conscience, belonged to
him. To determine whether the court abused its discretion in deciding that he
did not, we first determine whether there was sufficient evidence to support the
unchallenged findings that explain the court's reasoning and analysis. Then we
determine, based on the evidence, whether the decision was arbitrary,
unreasonable or unsupported by guiding rules and principles. We conclude that
there was and it was not.
The undisputed evidence
shows that MAC owed money to Mid-Continent and Inwood for furniture orders; Edwards knew MAC owed money to Mid-Continent
and Inwood for furniture orders; Edwards agreed to purchase certain of MAC's
receivables even though he knew it was a high-risk transaction; Edwards
confirmed the amount owed to Mid-Continent and issued a cashier's check payable
to Mid-Continent for that amount; Edwards did not confirm the amounts owed to
Inwood or the other suppliers, but instead paid the suppliers the amounts listed
in the agreement he had with MAC; Edwards did not request copies of invoices or
orders to compare to MAC's receivables; Edwards paid Inwood $15,292.22; the
check to Inwood contained the notation that it was for “MAC Group Payment”; and
Edwards advised Mid-Continent and Inwood to credit the payments to MAC's
accounts without specifying which invoices the payments were intended to cover.
This evidence is legally and factually sufficient to support the trial court's unchallenged findings of
fact. See
Footnote 10
And these unchallenged findings also demonstrate that, unlike some cases where
the claimant was awarded restitution, Edwards unconditionally paid the amounts
he intended to pay to the parties he actually paid in order to satisfy debts
owed by Matthews. He did not overpay Mid- Continent and Inwood. See
Benson, 464 S.W.2d at 712-13 (restitution allowed for overpayment of
automobile repair bill). He did not pay the wrong suppliers. See Lyman
D. Robinson Family Ltd. P'ship, 143 S.W.3d at 520 (restitution allowed when
earnest money released to wrong client); Doss, 210 S.W.3d at 710-11
(restitution authorized when financial institution applied note payment to wrong
note); Amoco Prod. Co., 946 S.W.2d at 165 (restitution allowed when
company paid royalty interests to wrong person). And he was not defrauded by
Mid-Continent or Inwood. See Staats, 150 Tex. at 584-85, 243 S.W.2d at
687-88 (recovery authorized when creditor refused to return surplus arising on
sale of security for debt); Wiseman, 69 Tex. at 65, 6 S.W. at 743-44
(same).
Nevertheless, Edwards
argues that the trial court erred by not balancing the equities in his favor for several reasons: Mid-Continent and Inwood
engaged in business practices whereby they shipped merchandise to MAC before
they knew whether or not MAC's check was covered by sufficient funds; MAC had
these unpaid account balances with Mid-Continent and Inwood before Edwards sent
his payments to them; requiring Mid-Continent and Inwood to refund Edwards's
money would put them in the position they were in before they received Edwards's
payments; the payments were not used for Edwards's benefit; Mid-Continent and
Inwood did not contact Edwards about how the payments should be applied;
Edwards's check to Inwood was not for the full amount of the account balance, as
Inwood had been told it would be; and Edwards was deceived by Matthews. We
conclude that, although these are some of several types of factors courts may
consider in balancing the equities, they are not determinative of the outcome in
this case.
We conclude that the
trial court's decision was not arbitrary, unreasonable or unsupported by guiding rules and principles and, as a result,
the court did not abuse its discretion.
We affirm the trial
court's judgment.
ELIZABETH
LANG-MIERS
JUSTICE
061421f.p05
Footnote
1
Henin testified that she would
not know the names of MAC's customers because
furniture orders were typically shipped to an installer, not directly to the
customer.
Footnote
2
Edwards also reviewed a copy of
MAC's invoices to these customers, but Matthews
did not provide, and Edwards did not ask to see, the orders MAC placed with
Mid-Continent, Inwood, and the other furniture suppliers to compare to MAC's
customer invoices. Matthews also provided a copy of “MAC Group's Income History
& Projections” from 2002 through December 2003 but Edwards testified that he
did nothing to verify the numbers contained in that report.
Footnote
3
The evidence shows that “908” is
Mid-Continent's customer number for
MAC.
Footnote
4
Although the check to Inwood was
twelve cents less than the amount listed in the
agreement, Edwards testified that the check he wrote to Inwood corresponded to
the same payable in the agreement.
Footnote
5
Edwards did not sue Matthews,
MAC, or the other five suppliers. He sued both
Inwood and Mid-Continent for money had and received. He also sued Mid-Continent
for breach of contract, fraud, negligent misrepresentation and unjust
enrichment. This appeal involves only the claim for money had and
received.
Footnote
6
In cases involving overlapping
standards of review, Texas courts have held that
a reviewing court must first determine whether the trial court had sufficient
information upon which to exercise its discretion and then whether the trial
court erred in applying that discretion. See, e.g., Reese v.
Duncan, 80 S.W.3d 650, 659 (Tex. App.-Dallas 2002, pet. denied) (trial court
does not abuse discretion if evidence is sufficient to support findings of
fact); In re C.A.M.M., 243 S.W.3d 211, 220-21 (Tex. App.-Houston [14th
Dist.] 2007, no pet. h.) (legal and factual insufficiency are not independent
grounds for reversal but instead are factors to be considered in determining
whether trial court abused discretion); Sotelo v. Gonzales, 170 S.W.3d
783, 787 (Tex. App.-El Paso 2005, no pet.) (once reviewing court determines
whether sufficient evidence exists upon which trial court could exercise its
discretion, then must decide whether trial court made reasonable decision);
El Paso County Hosp. Dist. v. Gilbert, 64 S.W.3d 200, 203-04 (Tex.
App.-El Paso 2001, pet. denied) (after analyzing legal and factual sufficiency
issues, reviewing court then determines whether, based on evidence, trial court
made reasonable decision or whether it is arbitrary and
unreasonable).
Footnote
7
In fact, many courts use the
term “money had and received” interchangeably
with other terms for similar claims. See Friberg-Cooper Water Supply Corp. v.
Elledge, 197 S.W.3d 826, 832 & n.38 (Tex. App.-Fort Worth 2006)
(recognizing that courts focus on facts alleged and recovery sought to
categorize action as one for money had and received or for restitution),
rev'd on other grounds, 240 S.W.3d 869 (Tex. 2007) (per curiam); see
also Tri-State Chemicals, Inc. v. Western Organics, Inc., 83 S.W.3d
189, 193-95 (Tex. App.-Amarillo 2002, pet. denied) (assumpsit); Amoco Prod.
Co., 946 S.W.2d at 164-65 (unjust enrichment, implied and constructive
contracts and trusts); Greer v. White Oak State Bank, 673 S.W.2d 326,
329-30 (Tex. App.-Texarkana 1984, no writ) (restitution).
Footnote
8
These factual
findings state:
17.
On or about August 22, 2003, Edwards issued six other checks to
Matthews's creditors:
No.
123 to Inwood Office Furniture for $15,292.22
No.
124 to HBF for $3,075.60
No.
125 to Shelby Williams for $2,659.43
No.
126 to Nienkamper ICF for $1,250.00
No.
127 to Bratrud Furniture for $4,143.40
No.
128 to Mai Space for $7,359.95
None of the foregoing checks were
delivered with transmittal letters or letters of instruction.
18.
The check Plaintiff sent
to Inwood Office Furniture in the amount of $15,292.22, which was the amount (less 12 cents) owed by Hal Matthews d/b/a/
the MAC Group for one of two invoices that Inwood shipped after receiving the
payment.
19.
Inwood Office Furniture was never paid for the second invoice shipped
that date, in the amount of $1,960.92, and that
amount was written off in December of 2003, so that Inwood remains unpaid for
that invoice.
* * *
23.
Defendant Inwood manufactured and properly shipped by common
carrier the one shipment of two invoices ordered
by Hal Matthews d/b/a/ the MAC Group, and it was delivered by Nancy Baer
Trucking and accepted.
Footnote
9
Edwards also cites cases from
other jurisdictions and an unpublished 1980
Tyler court of appeals case. See Pickett v. Republic Nat'l Bank of
Dallas, Trustee, No. 1303, 1980 Tex. App. LEXIS 3119 (Tex. App.-Tyler Feb.
28, 1980). The opinion in that case was withdrawn and a new opinion substituted
at Pickett v. Republic Nat'l Bank of Dallas, Trustee, 601 S.W.2d 405
(Tex. App.-Tyler 1980), aff'd, 619 S.W.2d 399 (Tex. 1981). Edwards does
not cite to or state how the substituted opinion supports his
argument.
Footnote
10
This evidence supports the
following unchallenged findings of fact:
9.
The transaction between
[Edwards] and Matthews was a high-risk transaction through which [Edwards] hoped to make a significant profit. Although
the transaction was high-risk, [Edwards] neither requested copies of purchase
orders that Matthews had submitted to any of his vendors nor did he compare any
purchase orders with the accounts that he was purchasing from
Matthews.
* * *
13.
On August 18, 2003,
Matthews and [Edwards] entered into an agreement entitled “Factoring Agreement” whereby Matthews sold the Billingsley,
Hance Scarborough, and Senior Management invoices to [Edwards] for the sum of
$62,052.81. Matthews did not provide Edwards-nor did Edwards request-copies of
Matthews's purchase orders to or the invoices from Mid-Continent, Inwood Office
Furniture, or other vendors. [Edwards] drafted and prepared the Factoring
Agreement himself.
* *
*
15.
On August 18, 2003,
[Edwards] telephoned Mid-Continent's office in Houston and spoke with Pat Henin to inquire whether certain furniture had been
shipped. [Edwards] did not request copies of the purchase orders submitted by
Matthews or the invoices Mid-Continent had submitted to Matthews to compare the
items included in those documents with the accounts he was purchasing from
Matthews. [Edwards] did not ask for any written verification or detail
concerning the items remaining to be shipped, nor did he specifically ask Henin
where the items were being shipped. Other than placing this one call, [Edwards]
took no other steps to confirm or verify the accuracy of the accounts that he
was purchasing from Matthews.
16.
On August 18, 2003,
[Edwards] caused a cashier's check payable to “Mid Continent Furniture Distributors, Inc.” in the amount of $28,272.22 to
be issued and delivered to Matthews. . . .
* * *
20.
These were the only two
invoices Inwood had with the MAC Group. [Edwards] paid Inwood Office Furniture in the amount of $15,292.22 representing that he
was paying Inwood on Hal Matthews or the MAC Group's behalf for the merchandise
order placed by the MAC Group. The payment sent by [Edwards] stated on the face
of the check that it was a “MAC Group Payment.” No cover letter or instructions
were sent accompanying the check sent by [Edwards] to Inwood Office
Furniture.
21.
Inwood Office Furniture
did not represent to [Edwards] that they were holding furniture for shipment, or for a particular destination.
22.
[Edwards] knew the amount
owed Defendant Inwood by the MAC Group and he asked no questions about any other accounts or invoices.
File Date[04/25/2008]
File Name[061421F]
File
Locator[04/25/2008-061421F]