ON THE MERITS. (282 P. 772) This controversy arose upon the rejection by the administratrix of a portion of a claim against the estate of Ben P. Lewis, deceased. Lewis died on March 19, 1924. At the time of his death, and for several years before, he had been engaged in the merchandise business in Klamath Falls, Oregon. In April, 1924, defendant Hattie V. Lewis, was appointed administratrix of his estate.
For several years the decedent had been a customer of the plaintiff Mason, Ehrman Company, doing business with them largely on credit. After the death of Lewis, the plaintiff on April 28, 1924, presented a duly verified claim against the estate on an account running from June 29, 1920, to July 27, 1923, with various credits thereon, but leaving a balance due Mason, Ehrman Company of $3,712.44.
The administratrix did not pass on the claim, either to allow or disallow it. After waiting for about 18 months for defendant to pass on said claim, plaintiff filed a petition with the county court setting forth its claim and asking that the county judge adjudicate the same. The defendant appeared by herself and counsel, and the claim was considered and passed upon by the county judge, who allowed the claim to the extent of $2,034.53, and disallowed it as to two other items, one of $637.68 and another of $940.16, constituting a total *Page 254 amount of $1,577.68 disallowed. The amount allowed was paid before the trial in the circuit court so that the whole trial in the circuit court was practically in regard to the two items constituting the amount of $1,577.68 disallowed.
Owing to the peculiar condition of our statute, which does not require any pleading or written statement of the issues beyond the claim and the allowance or disallowance to be made upon the appeal, we can only gather what the real issues to be tried in the circuit court were from the testimony given and the obscure record and instructions, and the statement of the parties in the briefs. No censure is to be applied to counsel for failing to bring up a more explicit record as the law does not in terms require formal issues to be framed on the appeal from the county court. The procedure, barring the claim, comes as near approaching a primitive trial "upon the oral altercation of the parties" as prevails at this time in any judicial proceeding. At no stage of the proceedings or testimony do we find any question as to the genuineness of any item of goods sold and furnished. The items are practically admitted to be correct. Statements were furnished from time to time and not objected to, but the claim was not for an amount due upon a stated account, which in itself constitutes a cause of action, independent of the items of the account, just as a promissory note would, but for a balance on an open account; and it occurs to us that a claimant can no more present a claim due upon a balance of an open account and recover upon an account stated than he could present a claim upon a promissory note and recover an allowance of his claim by proving an open account. In proving an account stated upon a technical claim or action of that character, it is sufficient to prove that the *Page 255 alleged creditor or debtor had an accounting of the matters between them, and that a balance due the creditor was either actually or impliedly agreed upon, which sum the debtor agreed to pay. This agreement and promise, whether actual or implied, if proved, places upon the debtor the burden of proving fraud or mistake in order to impeach it.
In an action, where no technical allegation of an account stated is made, the burden of proof is upon the creditor to prove the correctness of his claim by the usual course of evidence. It may well be that this may be done by introducing his books, or, if the account is an extended one, by copies of the original entries shown to have been made by a person competent to make them. Or the correctness of the balance may be shown by evidence that from time to time, as the articles were furnished, bills showing the items, both debits and credits, were furnished the debtor, who made no objection to them within a reasonable time. In other words, the correctness of the balance may be shown by evidence of the fact that an itemized account was furnished the alleged debtor and not objected to by him within a reasonable time, but this is a matter of evidence only and does not constitute the estoppel or change the burden of proof as it would were the claim based primarily upon an account stated.
Evidence of an account stated is relevant and proper in an action on an open account. The rule is clearly stated in Theus Marbury v. M. Jipson, 3 Texas Court of Appeals 231 [3 Tex. Crim. 231] [3 Tex. Crim. 231] [3 Tex. Crim. 231], 232, as follows:
"§ 190. Admission of an account stated, admissible in evidence in suit on open account. Appellants offered to prove that they had had a settlement with appellee prior to the institution of this suit, and that upon said settlement he admitted that he owed them *Page 256 the amount sued for. This proposed evidence was rejected upon the ground that there was no allegation in the petition which would warrant its admission as the petition declared upon an open account, and the proposed evidence was with reference to an account stated. Held error. This suit is to recover the balance due upon an account. It is alleged in the petition that said balance was due and owing by appellee to appellants. Appellants were certainly entitled to prove this allegation by appellee's admissions. That the proposed evidence would prove an account stated, and therefore show a different cause of action than the one declared upon, is not such a variance between allegation and proof as would defeat recovery. In fact we perceive no substantial difference between the cause of action declared upon and the fact proposed to be proved. In both the cause of action is the unpaid balance of an account due. The admission of appellee that he owed said balance is proof of this cause of action, and not the cause of action itself. It is not necessary in a pleading to state the evidence by which the cause of action is to be established. (Wells v. Fairbanks, 5 Tex. 581.) The cause of action in this case is, that appellee owed appellants the balance of an account which he refused to pay. Appellants proposed to prove this cause of action by appellee's own admission. We can not perceive the reason of the rule which would exclude such evidence."
See also Stowe v. Sewall, 3 Stewart Porter, 67, 77, as follows:
"The third reason, it is believed, is equally untenable with either of the others. Because an account stated may be declared on as such, this does not preclude the plaintiff from introducing it under other counts, to which it may be applicable; and surely it would be novel doctrine to determine, that if, after action brought, the parties were to state an account, and the defendant were to thus acknowledge he was indebted to the plaintiff, this could not be given in evidence on the trial, when a verbal acknowledgment to the same effect would authorize recovery." *Page 257
A statement of the condition of the two items rejected is rather involved, but, so far as we can ascertain from the testimony, about March 12, 1923, Ben P. Lewis, being considerably indebted to plaintiff at the time, sold his grocery business to Owens Brothers. He was desirous of having plaintiff release him from his indebtedness to them and accept the Owens Brothers as its debtors in his place, which plaintiff refused to do, but the store and business was actually turned over to Owens Brothers and the business actually conducted by them in their own name. This continued until July 12 of the same year when the business was turned back to Mr. Lewis presumably because the purchasers were unable to make their payments. During the interval within which Owens Brothers were conducting the business, Nettleton-Bruce-Eschbach company, a railroad contracting firm, had become indebted to Owens Brothers in the sum of $940.16, and defendant claims that Owens Brothers sold and assigned this account to plaintiff with the agreement substantially that the account should be treated as so much cash to be applied on the account of Ben P. Lewis, which in effect would reduce the indebtedness of Owens Brothers to Lewis by that amount. Plaintiff denied this and introduced evidence tending to show that the account was only assigned to plaintiff for collection, and was not to be applied on Lewis' account with plaintiff until collected, which in effect it never was, except a small sum of about $45. Here was a final question for the jury.
In the course of the trial Mr. B.F. Owens was called as a witness and testified substantially, frequently referring to the book of accounts of the *Page 258 firm of Owens Brothers, that he had a conversation with a representative of plaintiff in regard to the business generally of Owens Brothers in which he stated that he had the account of $940.16 against the Nettleton-Bruce-Eschbach company; that, if plaintiff would take that account and give a credit for the amount to Lewis on Lewis' debt to plaintiff, it would help Owens Brothers by reducing their indebtedness by that amount; that plaintiff's representative agreed to this, and that Owens Brothers assigned the account to plaintiff with that understanding and credited Lewis on his books, and a day or two later informed Lewis. This is a condensation of Owens' testimony. For dates, amounts, et cetera, he frequently referred to his book which he testified was truthfully and consecutively kept and was correct. The book itself was finally offered in evidence. The evidence itself was relevant and the witness had a right to refresh his memory from the book as to amounts, dates, etcetera, but it was not in itself substantive evidence and an objection to receiving it as such should have been sustained, as it did not appear that the witness was unable to recall the transaction from his own memory. If a witness, not a party to the transaction, is unable to recall a business transaction definitely, but swears that he wrote it down at the time it occurred and knows that it was recorded truly, the writing is sometimes admitted, but in this case such deficiency in recollection is not shown. While this is a small and rather technical matter, we do not refer to it as a basis for a new trial, but, as the case must be tried again, we refer to it so that the error may not recur again. The evidence as to the other item of $637.68 was properly admitted. *Page 259
It is fair to say that the evidence as to these two items was very contradictory and came in under a running fire of objections from one side or the other, but, with the exception above indicated, we think the court ruled fairly and without any other technical error grave enough to warrant a reversal of this case. We can not say as much in regard to some of the instructions. The plaintiff is a corporation. Among the witnesses introduced by it, and, in fact, its chief witnesses, were the credit man, the manager of the Klamath Falls and Medford branch of its business, a clerk having charge of its collections in the Medford office, and another employe connected with the local branch of Klamath Falls. None of these witnesses were officers of the corporation, but employes having certain assigned duties. Without their testimony, the plaintiff could not establish its case, as it is apparent that no other persons would, in the nature of things, know about the relations and dealings of the various parties.
The court read the following excerpt from the statute to the jury:
"That no claim which shall have been rejected by the executor or administrator, as aforesaid, shall be allowed by any court, referee, or jury, except on some competent or satisfactory evidence other than the testimony of the claimant": § 1241, O.L.
The court gave this instruction:
"Now the claimant in this case is Mason, Ehrman and company, a corporation. A corporation is a legal entity under the law and can only be heard through its authorized representatives. Now the testimony of a corporation may be given to a jury by one, two or three, or any other number of its representatives; but the testimony of all of those representatives must be regarded by the jury solely as testimony of the corporation and can not be regarded otherwise. *Page 260
"Therefore it is necessary for the jury in this case to determine whether there is any other evidence before you besides the testimony of the claimant that would warrant you in returning a verdict in this case."
This instruction practically made it impossible for plaintiff to recover. It is not true that a witness, who is an employe of a corporation is speaking for the corporation when he is on the witness stand. He is not the claimant and the fact that the claimant is a corporation "having no soul to be saved or body to be jailed" and can not testify, does not make its employes claimants, or their testimony the testimony of the corporation. They are sworn as men and testify in their individual capacity as men. To hold otherwise, would be to make it impossible for any large mercantile corporation to recover from the estate of a deceased person the value of goods sold to a decedent in his lifetime. Large firms such as Olds, Wortman King, or Meier Frank in Portland would have no other way of proving the fact of a sale to a merchant since deceased, if the evidence of their bookkeepers, clerks and salesmen were held insufficient. The instruction was erroneous upon a most vital point in the case.
While the issues were so confused that it was doubtless difficult for the court to state them clearly, we think too much emphasis was laid upon what the county judge had decided. It is difficult to draw an exact line in respect to this, but the court should in any future trial avoid, as far as practicable, making the decision of the case by the county judge a prominent feature of the charge.
For the reasons given above, the judgment is reversed and a new trial ordered.
REVERSED AND NEW TRIAL ORDERED. BROWN, RAND and ROSSMAN, JJ., concur. *Page 261