Cretien v. Kincaid (84 S.W.2d 1094, 1935)

SMITH, Justice.

In October, 1933, appellee, Joe M. Kin-caid, Jr., and appellants, Paul D. Cretien and W. J. Bramblett, as partners, owned and were operating a chemical laboratory in San Antonio; Kincaid having previously purchased from Cretien and Bram-blett, for $2,500, a 40 per cent, interest in the business, in which the other two partners each retained a 30 per cent, interest. On July 19, 1933, Kincaid borrowed $1,-000 from a local bank, giving a partnership note therefor, as well as a chattel mortgage upon the partnership assets as security. This note was renewed on September 24, to mature on October 5, but before its maturity the bank sold and transferred the obligation, together with the lien, to one J. F. Buenz.

Differences between the partners Cre-tien and Branjblett, upon one hand, and Kincaid upon the other, culminated, on October 14, in Cretien and Bramblett bringing suit against Kincaid for. an accounting, settlement, and dissolution, and for other remedies not necessary to mention here.

Pending the disposition of that suit, on October 21, 1933, the parties entered into and executed the following contract:

“State of Texas, County of Bexar.

“This agreement made and entered into on this the 21st day of October, 1933, by and between Joe M. Kincaid, Jr., Paul D. Cretien and W. J. Bramblett, Witnesseth:

“That such parties are the sole members of the partnership firm known as ‘Texas Testing Laboratories of San Antonio, Texas/ the said Joe M. Kincaid, Jr., owning forty per cent in interest therein, and each of the other partners owning thirty per cent in interest therein. That on October 14, 1933, W. J. Bramblett and Paul D. Cretien filed suit in the 73rd District Court of Bexar County, Texas, such suit being numbered B-73111 in which action plaintiffs prayed for an accounting and settlement of the partnership affairs, and praying for the appointment of a receiver to operate such business and asking that a temporary injunction issue to restrain the sale of certain assets of such firm under and by virtue of a chattel mortgage dated July 19, 1933, executed by the firm and recorded in the chattel mortgage records of Bexar County,, Texas, such chattel mortgage having been given by such firm to secure the payment of a note of the firm in the sum of $1,000.00, dated June 24, 1933,'payable to. the Frost National Bank. That all matters involved in such suit have been settled by this agreement among the above named parties to such suit.

“That such note and chattel mortgage being now held by J. Fred Buenz have this day been renewed and extended for fifteen days from this date, by instrument in writing duly signed by all of the parties to this agreement.

“That as a full, complete and final accounting and settlement of the partnership affairs the said Paul D. Cretien and W. J. Bramblett agree that they will on or before fifteen days from date pay $1,-000.00 towards the discharge of such note and mortgage; that they assume and agree to pay the other outstanding indebtedness of such firm consisting of back- rent in the sum of $290.00, and all claims held by G. H. Todd of Dallas, Texas; that they will pay to the said Joe M. Kincaid, Jr., the sum of $500.00 in cash within fifteen days from date and will execute a note payable to his order in the sum of $1,000.-00 on such date, such note to be payable in monthly installments of $25.00 or more each, and to bear interest at the rate of eight (8%) per cent per annum payable monthly and included in such monthly installments, such note to provide that should such payments be in arrears at any time for as much as three months, that the holder thereof may, at his option declare the entire indebtedness immediately due and -payable, and to contain the customary attorney’s fee clause.

■ “It is understood and agreed that the ¡said Paul D. Cretien and W. J. Bramblett may be required to give as security for the purpose of borrowing the $1,500.00 above set forth a chattel mortgage on the equipment of the San Antonio Laboratory, and it is agreed that the payment of the said $1,000.00 note above described, payable to Joe M. Kincaid, Jr., shall be secured by a. second lien on the equipment of the San Antonio Laboratory; but if such mortgage would prevent the borrowing of such. $1,500.00 then the said Joe M. Kincaid, Jr., will accept, providing the outstanding indebtedness thereof does not exceed $1,000.-00, and the said Paul D. Cretien and W. J. Bramblett agree that they will give a chattel mortgage on the equipment of the