This suit was filed by the appellants, L. E. Rowley and J. W. Percival, against the appellees, C. A. Bryan and Bryan Oil Corporation, a corporation of which the said Bryan is president, for the sum of $22,198.62 alleged to be due appellants as a commission for the sale of the physical properties of the Imperial Petroleum Company. It was alleged that said property was so sold for the consideration of $493,972.58, and upon which sum appellee C. A. Bryan agreed, and became obligated to pay appellants a commission of 5 per cent., said commission aggregating $24,698.62, upon which, however, the plaintiffs admitted a credit of $2,500.
The appellees answered by a general demurrer, a general denial, and specially alleged that appellee C. A. Bryan and his brothers, during the fall and winter of 1919 and 1920, were large stockholders in the Imperial Petroleum Company, of which they had been the organizers, and former directors and trustees, but that, on account of misunderstandings with certain stockholders, they were ejected from their said positions, and became desirous of raising money with which to buy out such dissatisfied stockholders, and getting the company back into their own hands, and as a means to that end employed appellants, if at all, for the purpose of securing parties who would furnish money for the purpose of buying out the dissatisfied stockholders, and that, if they were liable to the plaintiffs in any sum, then it was only in a sum equal to 5 per cent. of the money secured for such purpose, to wit, $135,150; that 5 per cent. of this sum would amount to $6,757.50, which, after deducting the admitted credit of $2,500, would leave due the appellants only the sum of $4,257.50.
The case was tried without jury on the 10th day of June, 1921, and resulted in judgment for the appellants in the sum of $4257.50, and it is of this judgment that appellants complain on this appeal.
Appellants based their suit upon the following letter written by appellee C. A. Bryan, as indicated therein, viz.:
"Hotel La Salle, Chicago, 12/16, 1919.
"Dear Mr. Rowley: I should have written you in Detroit the letter promised before left, but time passed in a hurry with us.
"As agreed, I will see that the Imperial Petroleum Co. pay you and Mr. Percival a commission of five (5%) per cent. on the price their properties are sold for to myself and associates under the deal through Mr. Sibley.
"It is understood, of course, that you are to assist in getting the approval of the Michigan Securities Commission for sale of stock in Michigan by my new company, also to assist in getting charter in Delaware.
"Commission payable in same proportion and in same manner as Imperial get their money.
"I believe this is what you want. If not clear enough, it can be revised when I see you in Wichita Falls. I will see Mr. Percival and *Page 1041 try to arrange commission as I talked with you. I am leaving to-morrow expect to be in Wichita Falls on the 20th. I hope we can get everything arranged as soon as possible after Jan. 1st.
"Mrs. Bryan joins me in wishing you a merry Xmas a very happy prosperous New Year.
"Very truly yours, Chas. A. Bryan."
The trial court evidently concluded from the evidence that a true interpretation of the transaction between the parties was that, as alleged by appellees, they became desirous, not of selling their interest or their stock in the Imperial Petroleum Company, but of purchasing the stock of the dissatisfied stockholders and reorganizing the company; that, pursuant to that purpose, appellants were employed to assist in the reorganization, and did assist in the reorganization by securing a charter from the state of Delaware, and a permit from the state of Michigan for the sale of stock in the new company, it being finally concluded to reorganize in that way.
Appellants undertook to, and did, assist in bringing C. A. Bryan in touch with J. W. Sibley Co., of Michigan, who, by the sale of stock in the new company, secured and furnished to C. A. Bryan the amount necessary to buy the stock of all dissatisfied stockholders in the Imperial Petroleum Company, to wit, $135,150, after which that company, through its trustees, executed formal conveyance to the new company of all the tangible assets, such as mineral leases, oil wells, oil machinery, and so forth, for a stated consideration of $493,972.58. But the letter made the basis of appellants' suit promised payment of commissions "in same proportion and in same manner as Imperial get their money." Literally speaking, as shown by evidence evidently credited by the court below, the Imperial Petroleum Company, as such, received no money whatever. The stock of nonconsenting and dissatified stockholders was purchased, and appellee C. A. Bryan and other consenting stockholders merely surrendered or canceled their stock in the Imperial Petroleum Company and took stock of equivalent value in the Bryan Oil Corporation, which had been formed for reorganization purposes. After the elimination of the dissatisfied stockholders C. A. Bryan and the other consenting stockholders in the Imperial Petroleum Company were the equitable owners of all of its physical properties. There was no real sale of such equitable interest. They continued to be such equitable owners after becoming stockholders in the Bryan Oil Corporation. The change, so to speak, was but a mere transformation, and not a sale. In this view of the evidence the trial court undoubtedly allowed appellants full compensation as specified in the C. A. Bryan letter, and we are of the opinion that the references in that letter to Mr. Sibley, and of the manner of payment of commissions, authorized parol evidence which tended to show that the real transaction between the parties was in substance as alleged and testified to by the appellee, C. A. Bryan.
Nor do we think the court erred in declining to enter judgment against the Bryan Oil Corporation. The letter of C. A. Bryan was in the nature of a guaranty for the Imperial Petroleum Company, and does not purport to contract in behalf of the proposed new company, and the circumstances already indicated do not, in our opinion, create liability on the part of the Bryan Oil Corporation, the now holding company, within the rules announced in Weatherford, Mineral Wells N.W. Ry. Co. v. Granger,86 Tex. 348, 24 S.W. 794, 40 Am. St. Rep. 837, and other authorities on the subject.
We conclude that the assignments of error should be overruled, and the judgment affirmed.