Holberg & Company Case Brief Summary

Holberg & Company, the defendant, had a working business agreement with Citizens National Assurance Company (CNAC), the plaintiff. Owned and operated by Robert E. Holberg, Holberg & Co. is an unincorporated sole proprietorship. Holberg seeked out clients to sell insurance through CNAC for which he collected commission on the sale. To establish this practice between the two companies, CNAC drafted a contract detailing the appropriate conduct, commission rates, etc.
During a transaction, CNAC observed that Holberg had breached the contract and as a result decided to sue. CNAC and Holberg presented the contract between them to the trial court of Houston, Texas. CNAC pointed out the provision Holberg had breached, and though Holberg attempted to refute the claims, it was clear and apparent the contract had been violated. After careful review by the trial court, the judge awarded CNAC $94,304.79 as well as the additional expenditures accumulated as a result of the trial.
The initial decision dealt with just the two companies, excluding Holberg individually. Before the case was closed, while motions could still be placed into action, the plaintiff requested to modify the
Article 6135 states that “In suits by or against unincorporated companies, whatever judgment shall be rendered shall be as conclusive on the individual stockholders and members thereof as if they were individually parties to such suits.” This information itself revealed that the trial court was justified in its decision. Article 6137 further enhanced the argument in stating: "service of citation may also be had on any and all of the stockholders ... and [judgment] shall be equally binding upon the individual property of the stockholders…" Both of the supporting articles set precedence that reinforced the argument that Holberg, as the sole stockholder, was bound by the judgment of the