
    CALLAWAY v. ALBIN.
    (No. 529-4003.)
    
    (Commission of Appeals of Texas, Section A.
    May 7, 1924.)
    1. Evidence <&wkey;>44l(l) — Oral agreement held not to affect substance of written agreement of arbitration, so as to be inadmissible.
    Where parties agreed to arbitrate as to whether defendant should pay plaintiff for certain lambs; and whether plaintiff should pay for certain cow, in action on award, evidence of oral agreement affecting other matters mentioned in written agreement, not intended to be passed on by arbitrators, held not to violate rule that written agreements cannot be changed by parol.
    2. Arbitration and award <&wkey;>7 — Common-law arbitration agreement subject to laws governing contracts in general.
    Agreements for common-law arbitration are subject to laws governing contracts in general.
    3. Evidence ■&wkey;443(2)— Parol evidence of collateral agreement to induce execution of written agreement held admissible.
    Parol evidence of modification of written arbitration agreement, made contemporaneously with that agreement and before the issues were heard and determined by arbitrators, and made for purpose of inducing one of the parties to enter into arbitration, held admissible.
    4. Arbitration and award &wkey;>60 — Award held not too indefinite to support judgment.
    In action on award of arbitrators, held, that award, read in light of pleading and evidence, and of findings of jury, was not too indefinite and uncertain to support judgment for plaintiff.
    other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes
    Certified Questions from Court of Civil Appeals of Second Supreme Judicial District.
    Action by C. M. Albin against Oscar Cal-laway. Judgment for plaintiff, and defendant appealed to the Court of Civil Appeals, with certified questions to the Supreme Court.
    Questions answered.
    Callaway & Callaway, of Comanche, for appellant.
    Chandler & Pannill, of Stephenville, B. F. Holloway, of Comanche, and Bobt. B. Holloway, of Cisco, for appellee.
    
      
      Rehearing denied June 28, 1924.
    
   CHAPMAN, J.

On or about October 8, 1919, C. M. Albin sold to Oscar Callaway a flock of sheep, and accepted in part payment therefor 30 cows at $75 per head. The sheep were delivered to Callaway, and a delivery of-, cows was made by Callaway to Albin, in which delivery Albin claimed there were 29 head and Callaway claimed there were 30 head, and later Albin returned to Calla-way’s place and got another cow. About October 20, 1920, there was a controversy between Albin and Callaway as to whether Callaway should pay to Albin $750 for '100 lambs, which had died soon after they were sold by Albin to Callaway, and also whether Albin had received 30 or 31 cows from Callaway, and they agreed to settle their differences by arbitration, and about said date the following agreement for arbitration was drawn up:

“We, the undersigned, agree to submit for arbitration of whether or not Oscar Callaway shall pay to C. M. Albin seven hundred and fifty ($750) dollars for 100 lambs sold to Cal-laway by Albin at seven and 50/100 ($7.50) dollars a head, which immediately thereafter died from the effects of sore mouth and worms in their mouths, which they had at the time they were delivered to the said Callaway.
“And further whether or not the said Cal-laway shall pay the said Albin seventy-five ($75) dollars for a white-faced cow, which the said Callaway claims was delivered to the said Albin, and which the said Albin claims he did not get along with a bunch of cows sold and delivered to the said Albin by the said Callaway.
“Said Albin hereby agrees to return to Cal-laway farm a cow and calf that he drove off from the farm in January past, and to have suit filed by Callaway in the justice court dismissed at the cost of defendant, Albin.
“The parties hereto agree to comply without further question with the decision of the majority of the arbitrators, Geo. L. Sullivan, J. W. McCollum, and a third party they may select.. [Signed] C. M. Albin,
“Oscar Callaway.”

There is some question as to when the agreement was signed by the parties. The Court of Civil Appeals in their certificate state that the testimony of Albin shows that the agreement was signed on the date that the arbitrators met. The arbitrators mentioned in the agreement met December 16, 1920, and plaintiff, Albin, pleaded that before the árbitrators began their deliberations he stated that he could not go to trial on the article wherein he was to return the cow and calf to the Callaway farm, for the reason that he had sold the cow, but, in the event the said cow and calf were awarded to the said Callaway by the arbitrators, he would pay to the said Callaway $75 for sanie, and that said Callaway agreed to said condition. He further pleaded that it was further agreed at this time that the cost of suit in justice court should be paid by the party against whom judgment was rendered for the said cow in question. He further pleaded that he asked that the written arbitration agreement be so changed as to cover and express the changes agreed upon, hut that defendant said it was not necessary, but that defendant did agree, verbally and orally, to said changes. The arbitrators, after deliberation, made the following award:

“Comanche, Dec. 16, 1920.
“C. M. Albin,
“Oscar Callaway,
“Sirs: In reference to the matter submitted to us in regard to the sheep and cattle deal, a majority of the arbitrators decided that a proper settlement would be that Albin should keep the cow that he got, that the suit in the justice court be dismissed, and that Callaway should pay Albin the sum of ($750) seven hundred and fifty dollars. ‘J. W. McCollum,
“J. F. Grissom,
“Geo. L. Sullivan.”

Defendant, Callaway, refused to he bound by the award, and plaintiff, Albin, brought suit to enforce the award, and recovered the $750 awarded him by the arbitrators. There was another count in plaintiff’s petition, which it is not necessary to here mention.

Defendant, Callaway, by special exception alleged that the award made by the arbitrators did not conform to the written agreement of the parties, did not determine all the issues submitted, and was uncertain and indefinite, and therefore could not furnish a proper basis for a recovery. Another contention presented was that the parol modification of the written agreement could not be given effect, because proof of the same would be in violation of the terms of the written agreement. Defendant, Callaway, appealed from the district court of Comanche county to the Court of Civil Appeals of the S'econd District, and that court has certified to us the following questions:

“(1) Did the trial court err in the admission of proof of the parol modification of the arbitration agreement?
“(2) Was the award made by the arbitrators, read in the light of the pleadings and evidence, and findings of the jury, too indefinite and uncertain to support the judgment rendered in plaintiff’s favor?”

In our opinion the substance of the written agreement of arbitration was not changed by the oral agreement made on the day of the arbitration. It will be seen that in the written agreement there were only two things for the arbitrators to pass upon: One was whether Callaway should pay Al-bin $750 for 100 lambs which had died, and tile other was whether Callaway should pay Albin $75 for a cow, and the real issue to be determined in the second question, under the pleadings and facts, was whether Albin had gotten 30 or 31 head of cattle from Callaway. The third paragraph of the written agreement was not made to be passed upon by the arbitrators, hut was an agreement between , Callaway and Albin, and one which they could change by oral agfeement, and which Albin claims by his pleadings' was eliminated, for the reason that he could not comply with the terms thereof, having already sold the cow mentioned in the third paragraph of the writing, and with the third paragraph of the writing eliminated there still remained for the arbitrators to determine whether Callaway should pay $750 for the lambs, and whether Albin should pay $75 for the cow; the substance of the last-named issue being whether Albin had gotten from Callaway 30 or 31 head of cattle. Thus it will be seen that no change was made in the substance of the matters to be passed on by the arbitrators, and that the only change made was the one relieving Al-bin from binding himself to undertake to do an impossible thing, that is, to deliver to Callaway a cow that he had already sold, and to provide that, in the event the arbitrators should find that Albin had gotten 31 cows, he should pay for the one additional cow, instead of binding himself to return her, after he had sold the cow, and of which Callaway could not complain for the reason that the jury found that the value of this additional cow was $75, which was the amount that Albin paid him for the cows.

The Court of Civil Appeals in their certificate say that the proof showed that before the arbitrators heard the controversy Albin had sold the cow and calf, and therefore was unable to return them to Callaway’s pasture; therefore the oral agreement pleaded by plaintiff, that he claims was made before the arbitrators began their deliberations, was a natural one to make under the circumstances, and in view of the fact that it did not change the substance of the matters to be passed on by the¡ arbitrators, and in view of the fact that the findings of the arbitrators did, in reality, settle all matters of controversy between the plaintiff and defendant, and did settle the matters in controversy mentioned in the terms of the written agreement, we do not think that this change, which only affected the manner of reaching the settlement between the parties, was such a change as to be in violation of the general rule that written agreements cannot be changed by parol,

The Court of Civil Appeals in their certificate state that the record shows that, by reason of Callaway’s agreement to waive the return of the cow and calf- to his farm, plaintiff was induced to proceed with the hearing before the arbitrators. This being a common-law arbitration, the agreement signed by the parties was subject to the laws governing contracts in general.

The substance of plaintiff’s pleadings as to the oral agreement made on the day of the arbitration is that he was induced to enter into the arbitration upon the agreement of defendant Callaway that plaintiff would be relieved from undertaking to deliver to him the cow that he had sold, and also that the matter of the cost in justice court would be governed by the award made by the arbitrators as to the one cow in question, and as stated above the Court of Civil &ppeals says that the record so shows. The Court of Civil Appeals, in their certificate, also say that:

“Upon the trial of the case it was shown by the testimony of plaintiff, Albin, that the alleged parol modification of the written arbitration agreement was made contemporaneously with the execution of that agreement and before the issues were heard and determined by the arbitrators.”

It seems to be well settled that oral evidence is admissible to show the terms and conditions upon which a written instrument is executed, and the general rule is stated (22 Corpus Juris, pp. 1253 and 1254) in the following language:

“The rule permitting parol evidence of a collateral agreement is especially applicable where such agreement constituted part of .the consideration of the written agreement, or operated as an inducement for entering into it. * * * It has also been held that where, at the time of executing a writing, a stipulation has been entered into, a condition annex-ed or a promise made by word of mouth, 'on the faith of which the writing has been executed, parol evidence is admissible, even though it may vary or materially change the terms of the contract, and in such case it is not necessary to allege that the agreement was left out of the contract through fraud, accident, or mistake.”

And this principle, as applied to contracts in general, seems to be borne out by the following authorities: Rector v. Hunter, 15 Tex. 380; Faggard v. Williamson, 4 Tex. Civ. App. 337, 23 S. W. 557; Eubank v. Bostick (Tex. Civ. App.) 194 S. W. 214; Hill v. Walker (Tex. Civ. App.) 140 S. W. 1159; Watson v. Rice (Tex. Civ. App.) 166 S. W. 106; Street v. J. I. Case Threshing Machine Co. (Tex. Civ. App.) 188 S. W. 725; Ferguson v. Rafferty, 128 Pa. 337, 18 Atl. 484, 6 L. R. A. 33; Gandy v. Weckerly, 220 Pa. 285, 69 Atl. 858, 18 L. R. A. (N. S.) 434, 123 Am. St. Rep. 691; Ramey v. Allison, 64 Tex. 697; Schaeffer v. Blanc (Tex. Civ. App.) 87 S. W. 745, Holt v. Gordon (Tex. Civ. App.) 176 S. W. 902.

We are of the opinion that the parol agreement complained of made no material change in the substance of the matters to be determined by the arbitrators, and that whatever changes were made were, as pleaded by the plaintiff and found by the Court of Civil Appeals, made by defendant, Callaway, with plaintiff, Albin, to induce Albin to enter into the arbitration and abide by the findings of the arbitrators.

As to the second question, there were only two matters before the arbitrators after the parol agreement, and those were as to .whether Callaway should pay Albin $750 for the lambs, and whether Albin should pay $75 for the cow. The findings were that Callaway should pay Albin $750, and this could have been for nothing except for the lambs, as this is the only matter that the arbitrators had under consideration in which Callaway should pay anything to Albin, and the other matter was that Albin should keep the cow that he got, which was finding in substance that Albin had received only SO cows from Callaway, including the one cow gotten by Albin, and therefore owed him nothing for the additional cow that Callaway claimed he had gotten. And the matter of cost in the justice court under the agreement as pleaded by plaintiff, Albin, was determined by the arbitration when they determined the 'controversy as to the additional cow.

We therefore answer question No. 1 that the trial court did not err in the admission of proof of the parol agreement, and we answer question No. 2 that the award made by the arbitrators, read in the light of the pleadings and evidence, and findings of the jury, was not too indefinite and uncertain to support the judgment rendered in plaintiff’s favor.

CURETON, C. J.

The opinion of the Commission of Appeals, answering certified questions, is, adopted and ordered certified to the Court of Civil Appeals.  