author: HOGAN, Judge.

text:
    SEMO MOTOR COMPANY, a corporation, Plaintiff-Respondent, v. NATIONAL MUTUAL INSURANCE COMPANY, formerly known as Colonial Mutual Insurance Company, a corporation, Defendant-Appellant.
    No. 8295.
    Springfield Court of Appeals. Missouri.
    Oct. 15, 1964.

      Dwight Crader, Sikeston, for defendant-appellant.
    Harry A. Blanton, Blanton, Blanton & Rice, Sikeston, for plaintiff-respondent.
   HOGAN, Judge.

This action was brought on an automobile insurance policy issued by the appellant insurer. The automobile involved was destroyed in a collision, and the owner thereafter discharged the responsible tort-fea-sors by accord and satisfaction, but failed to discharge the mortgage debt against the automobile. The plaintiff, who was the original vendor, brought this action as as-signee of the mortgage and had judgment against the defendant insurer for the amount of the unpaid debt, plus interest. The defendant has appealed, and the general question before us is whether, in the circumstances, the insured’s release of the tort-feasors has released the insurer from liability to the mortgagee.

The case was tried to the court upon stipulated facts, and the substance of the stipulation is that on October 27, 1959, the plaintiff sold the automobile involved to one Ray Smith. At the same time, Smith gave the plaintiff his promissory note, secured by a mortgage on the automobile, and the note and mortgage were at once endorsed and sold to General Motors Acceptance Corporation at Blytheville, Arkansas. On March 14, 1960, the defendant (actually its predecessor in interest) issued an automobile insurance policy covering the automobile in question to Smith and his wife, Naomi. The policy provided coverage against loss by collision or upset, and in material part provided by Item 3 that, in consideration of the premium and “subject to the limits of liability, exclusions, conditions and other terms of this policy,’’ the carrier agreed to pay direct and accidental loss of or damage to the insured automobile under the coverages specified, and this item concluded:

“LOSS PAYEE: Any loss under Coverage A, B, C, D, E and F is payable as interest may appear to the named insured and G.M.A.C., Blythesville, Arkansas.”

Coverage B is the collision or upset coverage.

On May 6, 1960, while the policy was in effect, the automobile was destroyed in a collision. It is stipulated that the loss was covered by the policy and that at the time of loss the defendant became obligated to pay the mortgagee the sum due it under its chattel mortgage.

On July 26, 1960, Mr. Smith (the insured mortgagor) brought an action against the insurer to recover the amount due because of the collision loss; recovery was also sought for vexatious delay and attorneys’ fees.

At about the same time, Mr. Smith commenced an action against the responsible tort-feasors in another court. We do not know when this second action was initiated, hut from the stipulation of facts we know that on August 9, 1960, Mr. Smith filed an amended petition against these tort-feasors seeking to recover only for personal injuries, without making claim for any property damage. Though it is not shown precisely how much knowledge the insurer had concerning this second suit, it is apparent from the record that it made somé claim of lien, upon the proceeds of this second action under the subrogation provision of its policy.

On March 8, 1961, Mr. Smith executed a full release to the responsible tort-feasors. The release appears in the record, hut we do not know when Mr. Smith received payment nor when the release was delivered. On April 26,'1961, the insurer’s attorney addressed a letter to the insured’s attorney advising him that, although the carrier had in the past asserted a lien, it would not further assert its lien if the action upon the policy was dismissed. Upon receipt of this letter, both the action against the insurer and the action against the responsible tort-feasors were dismissed with prejudice.

In the meantime, default had been made in payment of the mortgage debt, and consequently G.M.A.C. reassigned the note and mortgage to the plaintiff. The validity of this assignment is not questioned on this appeal. Plaintiff made demand for the bal-anee due on the mortgage debt, and the insurer refused the demand. This action followed.

The appellant argues that by fully releasing the responsible wrongdoers, depriving the insurer of its right to subrogation, the policy has been forfeited by breach of condition subsequent and it argues that since in this instance the mortgagee’s rights were wholly derivative, and the insured has no right of recovery, the mortgagee’s right of recovery is also barred. The respondent maintains that the course of dealing between the insured and insurer amounted to a settlement of the loss without the mortgagee’s participation or consent, and is therefore not binding on the mortgagee.

The parties’ arguments, in large measure, center around two well-established and somewhat conflicting principles. The appellant insurer bases its argument on the policy provisions, pointing out that there are in general two types of loss payable provisions in property insurance policies. The “open” loss payable clause usually provides that, subject to the terms and conditions of the policy, the insured’s loss, if any, shall be payable to the insured and the mortgagee as their interests may appear. The “standard” or “uniform” mortgage provision ordinarily contains a somewhat similar expression, but also provides that no act or omission of the insured shall invalidate the policy as to the mortgagee. Not all such wordings are identical, of course, and we do not undertake to deal generally with the nature and effect of loss payable provisions; however, the distinction generally drawn, as the appellant says, is that under the open loss payable clause the mortgagee stands in the mortgagor’s shoes, and is usually considered subject to the same defenses, while tinder the standard clause a breach of the policy terms is no defense to an action by the mortgagee. The appellant’s position is that since the insured has barred his own action, he has also barred any action by the mortgagee.

The respondent, on the other hand, minimizes the difference between the open and standard loss payable provisions, and argues that any adjustment, settlement or other disposition of the insured’s claim made without the mortgagee’s participation or consent is not binding on the mortgagee, whose rights became vested at the moment of loss. The respondent bases this argument on the well-established principle that even when the loss payable clause is of the open type a mortgagee entitled to the proceeds of an insurance policy is not bound by a settlement of the loss made by the carrier and its insured, where the settlement or adjustment is made without the mortgagee’s knowledge or consent.

A word here concerning the posture of this case on appeal, or at least our view of it, is appropriate. The case is before us on stipulated facts, and ordinarily when an action is tried upon an agreed statement of fact, the sole question presented on appeal is whether the judgment is represented by the proper legal conclusion upon the facts stipulated, Jewel Tea Co. v. City of Carthage, 257 Mo. 383, 388, 165 S.W. 743, 744, but such is not invariably the case. The stipulation here does not, for example, show whether the insurer had knowledge of the release executed by the insured when it waived its claim to subro-gation if the action against it were dismissed, nor does it show that the settlement with the responsible wrongdoers had been fully effectuated by March 8, 1961, when the release was signed. We do not know precisely the nature and extent of the information which the insurer had concerning the assured’s negotiations with the responsible tort-feasors, but we consider it a reasonable inference that it knew of the action pending against the responsible tort-feasors and that it made its claim of lien against the proceeds of that suit. Therefore, since these ultimate facts or factual inferences are not stipulated, we must view the conceded facts in a light most favorable to the respondent and reject inferences favorable to the appellant, and affirm the judgment if that can be done upon any reasonable theory of the law and facts. Murphy v. Doniphan Telephone Co., 347 Mo. 372, 379, 147 S.W.2d 616, 619-620 [6] [7,8].

Even so, the case is not without its difficulties. In point of fact, none of the authorities cited from our own jurisdiction actually rules the precise point in question, so far as we can determine. There are several fairly recent cases which indeed hold, as we read them, that settlement with, or release of, a tort-feasor for the full amount of the loss defeats the insurer’s right of subrogation, and no recovery can thereafter be had against the insurer on the policy, e. g., Richardson v. Employers Mut. Liability Ins. Co. of Wis., Mo.App., 269 S.W.2d 132, 135-136 [2]; Knight v. Calvert Fire Ins. Co., Mo.App., 268 S.W.2d 53, 55 [2], and this appears to be the law generally, Anno., 38 A.L.R.2d 1095, 1096-1098, Section 2 (1954), but these authorities do not deal specifically with a mortgagee’s rights after loss, but only with the insured’s right of action on the policy. Ford v. Iowa State Ins. Co., supra, n. 1, 317 Mo. 1144, 298 S.W. 741, 56 A.L.R. 842, does discuss the rights of a mortgagee under an open loss payable clause upon forfeiture by the -assured, but does-not "take into' account-the effect of the carrier’s-knowledge of a policy violation which occurs after loss,. nor deal with settlement of an admittedly- covered loss without the mortgagee’s consent. Ramsey v. Farmers’ Mut. Ins. Co. of Macon, Mo., 234 Mo.App. 1102, 139 S.W.2d 1027, deals with the mortgagee’s rights under an open loss payable clause in a case where the policy had been forfeited by reason of foreclosure before loss, but that case recognizes the principle that an insurer may waive or be, estopped to assert policy defenses if it has knowledge of them or acquiesces in the policy breach. Brown v. State Auto. Ins. Ass’n, Auto. Underwriters Corp., supra, n. 1, 265 S.W.2d 741, does recognize the difference between the open and standard, or union, loss payable clauses, but specifically holds, 265 S.W.2d at 743, that the insurer may not effect a settlement of its liability with the assured which will bind the mortgagee unless the mortgagee consents, and in the Brown case there had been no violation of the policy provisions. The fact is that while courts generally hold that an insured who fully releases the responsible tort-feasor and destroys the carrier’s right of subrogation thereby loses his right of action on the policy, this rule has not been universally extended, as the appellant seeks to maintain, to bar the mortgagee’s right of indemnity. Anno., supra, 38 A.L.R.2d at 1098-1099, Section 3 (1954); 7 Am.Jur.2d, Automobile Insurance, Section 206, pp. 548-549.

On the other hand, we set to one side, though we do not ignore, the respondent’s broader contentions that in net effect there is no difference between the open and standard, or union, loss payable provisions, and that there has, as a matter of fact, been no breach of the policy terms. In construing the loss payable clause here, we believe we are governed by the decision in the Ford case, supra, which holds, as we read it, that- if the loss payable clause is made subject to the conditions of the policy, then the loss payable clause is to be construed as the open type. Ford v. Iowa State Ins. Co., supra, n. 1, 317. Mo. at 1156, 298 S.W. at 746, 56 A.L.R., at 850; Anno., 56 A.L.R. 850, 851 (1928). Nor do we find it necesr sary to resolve whether it could reasonably be said that the insurer here waived its right of subrogation or is estopped to assert such a' defense, as far as the insured is concerned, because of its' acquiescence in the insured’s settlement. While there seems to be little doubt that an insurer may impliedly waive or be estopped to assert the destruction of its right of subrogation if it deliberately or negligently induces the insured to make a settlement with the tort-feasor, Anno., 16 A.L.R.2d 1269, 1271-1272, Section 2 (1951); Anno., supra, 38 A.L.R.2d at 1099-1100, Section 4 (1954); 7 Am. Jur.2d, Automobile Insurance, Section 206, p. 548, we find it unnecessary to decide or attempt to state what the insured’s rights against the insurer were after his release of the responsible wrongdoers.

There appears to be a conflict in the authorities whether, under the simple or open loss payable provisions in an automobile collision policy, the act of the insured in releasing the tort-feasor discharges the insurer’s obligation to the mortgagee as well as to the insured. Our admittedly incomplete research shows only a few cases in which this precise question has been decided. In Elmore v. Royal Ins. Co., 154 Kan. 93, 114 P.2d 786, the insured mortgagor fully released the responsible wrongdoer within four days of the loss, without the knowledge of the insurer or mortgagee. The policy contained a loss payable clause made “[sjubject to all the provisions, exclusions, conditions and warranties contained in this policy * * The mortgagee later sued the mortgagor’s carrier, and recovery was denied. The Supreme Court of Kansas pointed out, among other things, that in Kansas the mortgagee had no rights independent of the mortgagor under the simple loss payable or open clauses, and concluded, 114 P.2d at 790, that “[the mortgagee’s rights] were not independent rights but rights collateral to those of-the mortgagor which the mortgagor, under the plain terms of the contract, could forfeit * * * The mortgagor did forfeit them. * * *” The court noted, however, 114 P.2d at 790, that “ * * * [w]hete the insurer and insured together, without the mortgagee’s knowledge or consent, settle a loss and thereby deprive the mortgagee of his right to collect, as his interest may appear, an entirely different situation is presented. * * * In such a case the insurer has no basis for complaint. Simple and ordinary fairness precludes an insurer from arbitrarily disposing of a mortgagee’s interest in that fashion. * * * ” This court thus intimated that there are situations in which the carrier would be estopped to assert its right of subrogation as a defense to recovery by the mortgagee, if it settled its loss with the insured without the mortgagee’s consent.

■ The insured executed a general release to the tort-feasor before settlement with his collision carrier, without the knowledge or consent of the mortgagee, in Sargent v. Firemen’s Ins. Co. of Newark, 89 N.H. 171, 195 A. 346. The policy contained a loss payable clause making loss-payable to the insured and the mortgagee “as "interest may appear.” On appeal, the New Hampshire court held, 195 A. at 347-348, that “ * * * the rule here is that, 'at the moment of loss, the rights of the parties were fixed. * * * Hall [the mortgagor] could not release the defendants from their obligation, nor defeat [the mortgagee’s] right. * * * If a mortgagor’s settlement with and release to an insurer does not discharge the latter’s obligation to a mortgagee to whom the loss is made payable, we see no possible way in which a mortgagor’s similar transaction with a third party can be held to produce the opposite result. * * *”

Superior Lloyds of America v. Boesch Loan Co., Tex.Civ.App., 153 S.W.2d 973, involved an action in which the plaintiff was the mortgagee suing the defendant insurer upon an insurance policy covering an automobile destroyed by collision. So far as the report shows, the mortgagor and his wife were injured in a collision between their automobile and a trairi. They were injured in October of 1937,: and made a settlement with the railway company on February 23, 1938. Upon' the suit by the mortgagee, the defendant insurance company maintained that it’ was not further liable on the policy because the insured had accepted payment from the railway company and had executed a release covering all damages sustained in the collision, thereby forfeiting the insurer’s right of subro-gation. The loss payable clause there was made “ * * * subject however to all of the terms and conditions- of this policy, which are made a part hereof * * The mortgagee had judgment, and the insurer appealed. Upon appeal, the Texas court held, 153 S.W.2d at 975-976, that “ * * * if Miller [the' mortgagor] had forfeited his rights under the policy prior to the date of the loss, then Boesch [the mortgagee] would likewise be precluded from claiming rights under the forfeited contract. But in a case like this, where the policy was in full force and effect at the time the loss occurred, the rights of both the insured" and * * * the mortgagee, were fixed, and Boesch’s rights thereunder could not be taken away by the acts of Miller alone, after the loss occurred. * * * These acts [destroying subrogation] by Miller, not ratified or. participated in by Boesch, would not destroy the fixed interest Boesch had in the policy after loss, by virtue of his loss payable clause. * * * ”

In Remedial System of Loaning v. New Hampshire Fire Ins. Co., 227 Ky. 652, 13 S.W.2d 1005, the,defendant carrier insured a truck with collision coverage and a loss payable clause, apparently simply making loss payable to the mortgagor and mortgagee. While the policy,was in effect, the truck was destroyed by collision with a train, and at the same time the insured mortgagor suffered severe personal. injuries. The carrier denied liability and advised the insured to seek a settlement from the railroad company. The insured obtained such a settlement and fully released the tort-feasor. In declaring the applicable law, the Kentucky court held, 13 S.W.2d at 1006 [4,5] : “ * * * here the appellant [mortgagor] had a right to receive from the insurance company the amount due on its mortgage debt, and that right became a vested one when the truck was destroyed in the collision. Such right was not subject to be defeated without the consent of appellant by an act of the assured alone. * * * If Ray [the mortgagor] could not directly release appellant’s right to the money due it on the contract, he could not defeat that same right indirectly by a collateral contract with the alleged wrongdoer. * * * [The insurer] could not deny liability, direct or permit Ray to make a settlement with the alleged wrongdoer, which inured to its benefit, and then defeat the contractual rights of the mortgagee by invoking the settlement it had suggested and countenanced. * * * ”

Thus, while there is authority to the contrary, these authorities suggest two principles applicable to the kind of situation presented here: a) that even under an open loss payable clause the right of the mortgagee to receive its proportionate share of the proceeds of a collision policy becomes fixed at the moment of loss and cannot be thereafter defeated by any act of the insured alone; or b) that if the insurer countenances or suggests the insured mortgagor’s settlement with the responsible tort-feasor without participation or consent of the mortgagee, and such settlement inures to the insurer’s benefit, then the insurer may not be heard to assert its loss of right to subrogation as a defense to an action by the mortgagee. We would accept the first of these two propositions with some reserve; we are unwilling to say that there is no violation of the policy provisions occurring after loss which would not defeat the mortgagee’s rights under an open loss payable clause, but we consider the second principle to be sound and to be applicable here.

As we view the matter, there is no difference in principle between the case at hand and those situations in which the insurer and insured have negotiated a settlement between themselves without consideration of the mortgagee’s interest. It is stipulated that the loss was within the policy provisions and that the carrier became obligated to pay the mortgagee to the extent of its mortgage debt when the loss occurred. Some liability therefore accrued to the insurer under its policy when the loss occurred, and this liability ran both to the insured and the mortgagee, though to be sure the precise amount was indeterminate. See 7 Am.Jur.2d, Automobile Insurance, Section 189, pp. 528-529. There is no claim that the carrier was unaware of the mortgagee’s interest, nor that the insured violated any of the policy provisions after loss, except that the release defeated the carrier’s right of subrogation. The insurer then made a claim of lien against the proceeds of an action begun against the responsible tort-feasors. Aware of its liability and of the insured’s action against the tort-feasors, and having laid claim to a lien, the carrier, through its attorney, then advised the insured that it would make no claim for its subrogation if it were in effect relieved of liability on the policy. The mortgagee did not consent to nor participate in these negotiations. We do not say that the insured was not barred, but since the insurer was in effect relieved of a fixed liability in consideration of its foregoing a claim to subrogation, it can be said that there was a settlement of the insurer’s liability between the carrier and the insured without the consent of the mortgagee, and we think the mortgagee is not bound by that settlement. The judgment is therefore affirmed.

RUARK, P. J., concurs.

STONE, J., dissents.

      . Ford v. Iowa State Ins. Co., 317 Mo. 1144, 1149, 1154, 298 S.W. 741, 743, 745, 56 A.L.R. 842, 845, 849; Brown v. State Auto. Ins. Ass’n, Auto. Underwriters Corp., Des Moines, Iowa, Mo.App., 265 S.W.2d 741, 743 [1]; Prudential Ins. Co. of America v. German Mut. Fire Ins. Ass’n of Lohman, 231 Mo.App. 699, 705, 105 S.W.2d 1001, 1005 [5]; Gordon v. Northwestern Nat. Ins. Co., 228 Mo.App. 1008, 1021, 77 S.W.2d 512, 519-520 [1]; Anno., 88 A.L.R. 367, 368 I, II (1925); 5 Appleman, Insurance Law and Practice, § 3401, pp. 554r-562 (1941).

      . Brown v. State Auto. Ins. Ass’n, Auto. Underwriters Corp., Des Moines, Iowa, supra, n. 1, 265 S.W.2d at 743 [1]; Hahn v. National American Fire Ins. Co., 233 Mo.App. 756, 761-762, 127 S.W.2d 94, 96-97; Clarkson v. Importers’ & Exporters’ Ins. Co., Mo.App., 15 S.W.2d 939, 940-941 [3]; see Lumbermen’s Mutual Ins. Co. of Mansfield v. Wheeler, 225 Ark. 657, 284 S.W.2d 620, 622 [1]; Annos., 38 A.L.R. 383 (1925); 111 A.L.R. 697 (1937); 7 Am.Jur.2d, Automobile Insurance, § 199, p. 541; 5 Appleman, op. cit., § 3406, pp. 578-581.

      . E. g., see Conard v. Moreland, 230 Iowa 520, 298 N.W. 628; Universal Credit Co. v. Service Fire Ins. Co. of New York, 69 Ga.App. 357, 25 S.E.2d 526.


source: Caselaw Access Project

author: BROADDUS, Presiding Judge.

license: Public Domain

text:
    STATE ex rel. Harold M. SANDHAUS et al., Appellants, v. MISSOURI PUBLIC SERVICE COMMISSION et al., Respondents.
    No. 23994.
    Kansas City Court of Appeals. Missouri.
    June 1, 1964.
    Tweedie Fisher, Jefferson City, James F. Miller, Shawnee Mission, Kan., for appellants.
    G. M. Rebman, G. F. Gunn, Jr., La Tour-ette & Rebman, St. Louis, for intervenor.
    Glenn D. Evans, Thos. J. Downey, Jefferson City, for respondents.
   BROADDUS, Presiding Judge.

This is an appeal from a judgment of the Circuit Court of Cole County sustaining the order of the Public Service Commission.

This case came before the Commission upon application of Orscheln Bros. Truck Linesj Inc., Byers Transportation Company, Iric., Toedebusch Transfer, Inc., and Mid-dlewest Freightways, Inc., requesting'clarification of existing authorities held by said carriers to render service within the suburban territories of St. Louis and Kansas City, Missouri, in connection with their other authorized services. -By the statutory mileage formula set forth in- Section 390.-020 V.A;M.S., this suburban'territory dr commercial zone extends 19 miles in all directions' from St. Louis, Missouri, and IT miles from Kánsas City.

No, additional territory or authority was sought 'by the applicants. The applications were opposed by five irregular route common carriers, one of whom was Harold M. Sandhaus, Kansas City, Missouri. ■

After, due notice to all interested parties a, hearing was held before the Commission on these applications by agreement .of the parties, and tried on a joint record. The testimony offered applies generally to the operation of the four applicants and relates to! the methods used by these, applicants in conducting their physical truck operations in the handling of both truckload and l^ss.than truckload freight within the'suburban territory of both St. .Louis, Missouri, and Kansas City, Missouri.

The Commission made extensive findings and .-closed, its “Report” as- follows':

“In conclusion, it is the opinion of the Commission that it is within the public interest and the Commission so finds that the Applicant herein has authority to serve.points within the commercial zone 'of St. Louis .and the commercial zone of Kansas City as points on its regular routes and that the City of St. Louis, together with the territory surrounding such city desig-. nated as the .commercial zone is a regular route point, and that Kansas City together with the territory surrounding such city designated as the commercial zone is a regular route point,- all being in connection with'the Applicant’s regular route service out 'of St. Louis and Kansas City.
“Entertaining these views, it is, therefore,
“ORDERED: 1. That to the extent authority has been heretofore granted to Orscheln Bros. Truck Lines, Inc., holder of Certificate of Convenience and Necessity and Interstate Permit No. T-403, to serve between the suburban territories of Kansas City and St. Louis, and between said suburban territories, on the one hand, and points on its regular routes, on the other hand, said authority is hereby clarified and restated to provide that the Kansas City commercial zone and the St. Louis commercial zone are points on the regular routes of said carrier. The authority herein granted does not include thé right to render motor carrier service between separate municipalítiés in the St. Louis commercial zone and. the town of Independence, Missouri, but such right is expressly excluded. The" term “commercial zone” as uséd herein is as defined in'Section 390.020(14), RSMo 1959.”

The appellants filed motions for reconsideration with the Commission, which motions were subsequently denied. They subsequently appealed to the Circuit Court of Cole County, which court, as we have stated, sustained the order of'the Commission.

. Appellants state their first point as follows : “Authority granted. by Respondent Commission prior to 1951 authorizing a common carrier to render service to, from or between the ‘suburban territory’ of a municipality must designate the specific course or line of travel said carrier shall traverse when operating within the suburban territory to be a regular route.”

It is undisputed that Applicants hold áuthority from Respondent Commission authorizing each to serve Kansas City and St. Louis over specifically designated routes. They are also authorized to serve the “suburban territory” of Kansas City and the “suburban territory” of St. Louis. Respondent Commission, however, only designated the highways between Kansas City and St. Louis) Missouri, and did not designate the highways between the suburban territories.

In their brief appellants state their position as follows: “It should be noted that the authority granted applicants purportedly as regular route motor carriers does not specify or designate the streets, highways or roads over which their service would be performed. It is here where Appellants take issue with' Respondent and say that as required by the laws of Missouri, a regular route carrier must traverse regular routes and these routes must be designated and authorized by the Respondent Commission.”

From our investigation we have reached the conclusion that there is no requirement in the Missouri law that service in terminal collection and distribution traffic must be performed, over designated and specific courses or lines of travel when within a municipality or the suburban territory thereof.

The Supreme Court of Missouri in State ex rel. and to Use Public Service Commission v. Blair, 347 Mo. 220, 146 S.W.2d 865 (1940) was asked to determine whether a municipality and its suburban territory formed a single unit and were included as a point on a regular route. In holding that suburban territory was included within the meaning of regular routes, the Court stated, loc. cit. 871, 872:

“We do not believe that it was intended that ‘common carriers,’ engaged exclusively in intra urban business, must operate over a definite regular route in order to claim the exemption. As we understand, the Commission has never exercised nor claimed the right to establish regular routes within municipalities for strictly intra urban transportation. It would seem that the municipality should be left to determine what streets may be used , for-transportation wholly within its corporate limits. True, the Commission does have authority to establish regular routes 'in a municipality when the route also ex- ' tends beyond the limits of the munici-; polity and its suburban territory, but even then, the authorities of the munici-; pality must be consulted. That authority is given the Commission in order that the mileage of the route within thé. municipality may be established' and the fees properly allocated, but if the route is wholly within the municipality-there is no allocation to be made. Thev proviso above quoted, subsection (b), was included in Section 5264 as , it existed prior to 1931 except that it did not then contain the words ‘or property.’The former law did not apply , to. carriers of property and, of course, it was unnecessary to expressly except such carriers from the law in the pro-i viso. The term ‘regular route’- was not defined in the former law, but it apparently meant a route usually travh eled between fixed termini. In the present Act the term is defined, subsection (g), as ‘that portion of the public highway over, which a motor carrier usually or ordinarily operates or provides motor transportation service.’
“Thus it will be seen the requirement for fixed termini has been omitted and the definition extended to include the territory over which the carrier usually provides motor transportation service. In cities, the transportation of persons * * * is generally carried on over definite routes, while transportation service for property is usually and ordinarily provided from and to any points within the city and over any streets the use of which has not been restricted by the local authorities. We think the term 'regular routes’ as used in the proviso includes every .portion of the■ municipality and. suburban territory over which the -carrier usually or ordinarily provides transportation service.” (Emphasis supplied.)

As additional evidence of legislative intent that authority to serve a suburban territory or commercial zone is a part of regular route service is the fact that paragraph 16 of Section 390.020 V.A.M.S. provides that the Commission is neither authorized nor required “to fix or designate the specific course or line of travel to be used by any motor carrier within the corporate limits of any municipality served or traversed.” We rule the point against appellants.

By their second point, appellants assert that by its order the Respondent Commission has granted Applicants authority without evidence of need thereof. Appellants’ contention is based on the false premise that the authority originally issued to applicants relating to service of commercial zones was irregular. At no time did Respondent Commission ever consider Applicants commercial zone authority to he anything hut regular route authority. It was not incumbent upon Applicants to present any evidence of need for their services. No new service was sought.

Appellants state their third point as follows: “An area the size of Kansas City extended on both sides 11 air-line miles beyond the City Limits is not a point. It is an area or a territory.”

Paragraph 16 of Section 390.020 reads: “The term ‘regular route’ means a fixed, specific and determined course to he traveled by a motor carrier’s vehicle rendering service to, from or between various points, localities or municipalities in this state.” Relative to • this paragraph the Commission said:

“The Commission intérpretes the law to mean that a fixed specific' and determined course and regular -route service refers to a course to, from or between various points, localities or municipalities within the State and that the municipality, together with that territory extending one mile beyond the corporate limits of each municipality and one mile additional for each 50,000 population thereof is a regular route point of the Applicant. The word ‘localities’ is used in this paragraph as well as the word ‘points.’ The word ‘localities’ might well be interpreted to include an area such as the city including the commercial zone since the words ‘point, ‘localities’, ‘place’ and ‘area’ are often used similarly in transportation phraseology.”

With that interpretation we agree.

In their remaining two points appellants continue to argue that the order of Respondent Commission was a grant of new authority. This is not true. The applicants did not request any new authority and none was granted. The order of the Commission simply points out that authorities of Applicants to serve the Commercial zones of Kansas City and St. Louis are what they have been all along— points on the regular routes of Applicants.

Appellants do not deny that St. Louis and Kansas City are points on the regular routes of intervenors. Applicants testified in great detail that the operations which they conduct within the commercial zones are identical to those performed in the two named municipalities. The purpose of this testimony was to establish that service within the commercial zones and within the cities is by its very nature related to one specific unit or point.

Of course applicants do not employ a fixed route of travel for their pick up and delivery terminal zone service within the commercial zones. Neither do they employ a fixed route of travel for their pick up and delivery terminal zone service within the city limits of Kansas City and St. Louis. The service performed within the two cities and within their commercial zones is identical and inseparable. That is one of the elements which gives rise to the conclusion that as a matter of law the commercial zones of Kansas City and St. Louis are points on the routes of the regular route carriers.

The judgment of the Circuit Court of Cole County upholding Respondent Commission’s order is affirmed. All concur.


author: RUARK, Presiding Judge.

text:
    James CANNON and Jewell Cannon, husband and wife, Plaintiffs-Appellants, v. O. J. BINGMAN and Winnie B. Bingman, husband and wife, Defendants-Respondents.
    No. 8304.
    Springfield Court of Appeals. Missouri.
    Oct. 16, 1964.

      Harry H. Kay, Robert J. Quigley, Eldon, for plaintiffs-appellants.
    Theodore G. Scott, Buffalo, Gordon R. Boyer, Lamar, for defendants-respondents.
   RUARK, Presiding Judge.

This is an appeal by plaintiffs from a decree in their favor on their petition for rescission, cancellation, and return of the pur-' chase price which decree, however, allowed the defendants-respondents the sum of $5,900 as the reasonable rental value of the property while in plaintiffs’ possession. For convenience and clarity the plaintiffs-appellants Cannon will be referred to as “Buyers,” and the defendants-respondents Bingman will be referred to as “Sellers.” The case has been before this court in Cannon v. Bingman, 354 S.W.2d 894, where the facts are stated in detail; but in order to clarify the questions here we must restate some of the facts.

Sellers owned what is called “The Red Diamond Resort,” which consisted of property with apparent frontage on the Lake of the Ozarks. Upon such property was situate a four-room house and five cabins. We do not have the age of the resort, but apparently it had had a succession of owners since' 1946. Buyers got in contact with one Meissner, Sellers’ agent, who showed the property, including what he said were the property lines; and the upshot was that on May 20, 1958, the Buyers entered into a contract to buy the resort at a price of $32,500 and at that time paid $500 as earnest money. On June 26, 1958, Buyers paid a further sum of $8,500 and executed a note and deed of trust for $23,500. Some delay was occasioned in closing the paper transaction due to difficulty in getting the right description (appárently a survey was required for this purpose), but Buyers went into possession on July 1, 1958, although they did not then have a deed. All the paper transactions in respect to the sale took place in the office of Meissner (Sellers’ agent), who handled the transaction.

After taking possession, Buyers learned that the Red Diamond might be an imperfect jewel, for an adjoining neighbor claimed to own some of the property which Buyers had contracted to buy. The actual difference or dispute was based on the location of the property lines which had been represented to the Buyers. If the lines were as the neighbor claimed, Buyers’ property did not include a road and a portion of the laud; and the effect of such was that, if the claim was correct, Buyers did not get a substantial portion of the shore line. After hearing of this apparent discrepancy, the Buyers went hack to the agent and finally to the Sellers in order to get the matter “straightened out.” They wanted a survey. This dragged on with no results. Buyers did not accept a deed, but a deed was made (dated June 18, 1958, acknowledged June 20, 1958), recorded (on July 3, 1958, in Book 110, at page 411), and mailed to Buyers some time after that. On December 26, 1958, an installment of principal and interest became due and, in order to avoid default on the note and mortgage pending getting the matter straightened out, Buyer paid Sellers $900 on the principal and $585 as interest. Thereafter, the Buyers brought suit for rescission alleging misrepresentation as to the property lines and no adequate remedy at law. The petition prayed for cancellation of the contract, warranty deed, promissory note, for judgment in the sum of $9,900 (the amount of principal theretofore paid), and for the sum of $2,840 representing lost profits. It concluded with a prayer for general relief. Sellers answered, and on trial of that case the circuit court denied relief. Appeal was taken, and in Cannon v. Bingman, Mo.App., 354 S.W.2d 894, we held in substance that the evidence was clear and convincing that Sellers’ agent did misrepresent a material fact as to the actual boundary line; that such misrepresentation affected the value of the property (thought to be) involved; and that Sellers were chargeable with such misrepresentations. In that case we called attention to the fact that Sellers had had use of Buyers’ money during the entire time, but the record was so incomplete as to the earnings and reasonable value of the property while Buyers were in possession that no determination could be made in respect thereto; and the cause was reversed and remanded for retrial in accordance with the suggestions made.

Immediately prior to the present trial, Seller filed his amended answer, which consisted of a denial of plaintiffs’ allegations and claim of ownership of the disputed property by virtue of adverse possession for more than ten years. The answer also averred that on March 26, I960; the mortgage deed of trust herein referred to had been foreclosed and that Sellers had (again) become the owners by virtue of purchase at such foreclosure sale; that Buyers had refused to deliver possession to Sellers, that the reasonable monthly rental value of the premises was $2,500 per month, that Buyers had committed waste in the sum of $7,500. The prayer was judgment for rents and profits and use of premises from March 26, 1960, and judgment for waste. There was no prayer for general relief. ¡

In retrying the case the parties fairly well covered the waterfront (in this instance we. should say lake front). They tried anew| (or at least offered evidence concerning)’ the question of misrepresentations, location of boundary lines, adverse possession, earnings (or loss) of Buyers while in possession, and earnings of Sellers after they went back into possession. Income taxes, reports,, and accounts of both parties were gone into. Apparently both parties regarded the retrial as an action in accounting. Respondents’ counsel so stated at the trial. The evidence of the earnings of the parties during the periods involved is completely confusing. About all we get from it is that the Buyers made no actual profit while in possession but the premises had some rental value.

After listening to the welter of evidence, disagreements and arguments, the court on August 22, 1963, filed its “Memorandum” in, which it found:

“While it is true that Mr. Vincent’s second survey does not show the north property line to be as far south as shown by his incomplete survey, yet in my opinion said surveyor’s testimony does show that the north line is not at the fence as represented by defendants through their agent, Frank Meissner, and is not in the center of the present road. Therefore the court concludes that defendants, through their said agent, made the representations as to the north boundary line of the property as claimed by plaintiffs, that is, that the fence was the north line and that the present road and the parking area were located on said resort property. The Court finds and concludes that said representations were false, that the north boundary line is not along the fence and that it is not at the center of the present road, but is south of it. The Court further finds that said representations concerned material facts and that they induced the plaintiff to enter into, the contract of sale.
“In regard to what allowance, if any, defenclants should receive as rental of the,'resort property during the time plaintiffs had possession of it from Jill y, 1958, to June, 1960, there is proof in the record which justifies a deduction from the amount of $9,900.00 paid by plaintiffs to defendants on the contract of sale. Defendant O. J. Bingman testified that the reasonable rental value of the property per year was $3,500.00, that he was offered $2,800.00 for one year’s rent but refused it. The undisputed evidence shows that plaintiffs purchased the property for $32,500.00 and that they stated in their income tax returns that the buildings were worth $30,000.00. Therefore, the Court finds the reasonable rental value of the resort to be $5,900.00 for the period it was occupied by plaintiffs and allows that sum for the use of the property by plaintiffs during the time they were in possession of it.
“With reference to plaintiffs’ claim in their trial brief for interest on the amount they claim to be due from defendants, I have searched the pleadings and do not find that they have prayed for interest; moreover, since the damages are unliquidated in that it was not known how much defendants would be allowed as rent for the property and because in an equity case the allowance of interest is usually a matter for the chancellor’s discretion (Boyle v. Crimm [363 Mo. 731], 253 S.W.2d 149) it is my opinion that under the facts in this case interest should not be allowed.
“WHEREFORE, the issues on plaintiffs’ first amended petition are found for plaintiffs and the amount of their recovery is assessed at $4,000.00. Judgment is entered for plaintiffs against defendants for $4,000.00 and said judgment is declared to be a special lien against the right, title and interest of the defendants in and to the real estate described in the warranty deed attached as an exhibit to plaintiffs’ first amended petition.
“The issues on defendants] counterclaim are found for plaintiffs and the counterclaim is dismissed.”

On this appeal the sole question presented by the appellants, to quote their brief exactly, is “The court should allow appellants to recover interest on the sums which the chancellor found they were entitled to recover from respondents.” We do not, therefore, concern ourselves with the allowance of $5,900 to respondents as and for rents and profits, although we confess our inability to determine how the trial court arrived at such figure. Neither are we concerned with the $585 which appellants paid the respondents as interest (December 1958), because the contention here is only as to “interest on the sums which the chancellor found they were entitled to recover.” This, therefore, would be interest on the sum of $9,900 represented by payments of $500 made May 20, 1958, of $8,500 made June 26, 1958, and of $900 on the principal made December 26, 1958.

Appellants contend that since the court found Sellers-respondents to have been the wrongdoers and ordered the repayment of the sums obtained by that wrongdoing, it would be inequitable to permit them to have the benefit of both the value of the use of the premises and the use of the money during the period involved. The respondents’ contentions more or less follow the reasons offered by the court, (a) plaintiffs did not pray for interest, (b) interest could not be allowed because the amount was unliqui-dated, and (c) interest is at the discretion of the chancellor. We will deal with the questions in that order.

As to the failure to pray for interest: The plaintiffs did not make a specific request for allowance of interest. They did incorporate a prayer for general relief — “such further orders and judgments as shall be meet and proper in the premises.” The prayer is not strictly a part of the pleading and does not bind a court oi equity. A general prayer for relief permits the balancing of all the equities which are within the scope of the pleadings and the evidence; for once rightfully in possession of a case the court will not relinquish it short of doing complete justice, so that there may be a full and complete determination of the rights and liabilities of the parties in respect to the controversy involved.

In this case we find, as stated, the plaintiffs requested general relief. Not so with the defendants. The prayer of their amended answer requested judgment for rents and profits and use of the premises from March 26, 1960 (the date of foreclosure), and, if defendants are to be held strictly to their prayer for rents and profits, they would be entitled to recover for the use of premises from March 26, 1960, to June 5, 1960, the admitted date plaintiffs surrendered possession. If the allowance of $5,900 was intended to encompass the reasonable rental value for such period of two months and eleven days, it would be ridiculous under the evidence; but it is obvious that the court allowed such sum for the full period defendants were out of possession — namely, twenty-three months. Thus the court has allowed the Sellers a reduction or offset for a period not prayed for in the amended answer, while denying the Buyers any reduction in this amount for use of money during the period because not specially prayed for. We think that the allowance of interest was within the general purview and scope of the pleadings and the evidence.

As to (b), whether the sum was liquidated. It is a general rule that interest cannot be recovered on an unliquidated sum. But an amount is sufficiently liquidated for the purpose of allowing interest if the amount is readily ascertainable by computation or determination according to a recognized standard. In any event the right of one party to recover interest on a liquidated sum is not necessarily dependent upon the fact that all of the other parties’ claims may be liquidated. We see no difficulty in computing interest on the sums here involved. The sums and dates as heretofore stated are definite and fixed.

Boyle v. Crimm, 363 Mo. 731, 253 S.W.2d 149, was cited by the trial court in its memorandum and by respondents here as - authority fpr the proposition that alT •lowance of interest is “generally a 'matter for the chancellor’s discretion.” That case involved the question of the purpose and intent of the parties in regard to the assignment of insurance policies (whether absolutely ot as security). No wrongdoing was' involved. The case was decided on -the basis of contractual liability, and it was the opinion of the court that the evidence justified the conclusion that there was no actual agreement, or one which could-be implied from the circumstances, that interest was to be paid, but that in fact the circumstances indicated-the intention was to contrary. On the other hand, Parsons v. Third National Co., Mo.App., 124 S.W.2d 630, involved the improper, handling of a brokerage account and retention of certain stocks or the proceeds therefrom. Interest was allowed. A general rule seems to be that if money is wrongfully or fraudulently obtained or. withheld the law raises an artificial ' implied promise' to pay interest from the date the. money is wrongfully obtained. It is also held that where a wrongful act is involved; interest is recoverable as a' part of the damages. Thus, in cases, including -rescission, based on fraudulent representar tions.

As.was said in Brown v. Home Development Co., 129 N.J.Eq. 172, 18 A.2d 742, 746 (quoting, from earlier cases) :

“ * * * ‘It should be borne in- mind that the whole tendency of courts of law and courts of equity for a considerable period of time has been to break away from hard and fast rules and charge and allow ■ interest in accordance with principles of equity, in order .to accomplish justice -in each particular case.’ ”

‘We do not wish to rest our decision upon any technical rules which have grown.up involving interest Equity ‘will ;not suffer a wrong without'a remedy. - It is elastic in that it looks to the substance rather than the form and will never be applied to reach .an inequitable result or permit itself to be frozen .into a position of applying mechanical rules so that it becomes crystallized. It contrives its remedies so that they will correspond to the primary right of the injured party and to the wrong by which that right has been violated. It preserves its flexibility and expansiveness in order to meet the requirements of every case. Clark on Equity (Mo.Ed.), Sec. 32, p. 36; 1 Pom-eroy’s Equity Jurisprudence, Sec. 111, p. 125; 19 Am.Jur., See. 123, p. 123; Merrick v. Stephens, Mo.App., 337 S.W.2d 713, and cases at 719. See Gibson v. Shull, 251 Mo. 480, 158 S.W. 322. This is a case where the Sellers have been found to be wrongdoers, the transaction has been rescinded and cancelled, and the court has endeavored to restore the status quo. In such a situation, the “interest” on the moneys paid is not necessarily interest eo nomine but simply a measuring stick to determine the reasonable value of the use of the purchase money during the period it was in possession of the Sellers. If the' wrongdoers be allowed (as they were in this case) the reasonable rental value of the premises.during the period Buyers were in possession of the real estate, then simple justice and equity requires that the injured parties be entitled’ to the reasonable rental value of the purchase money while it was in the possession of the Sellers. Any other result would accomplish a lopsided status quo; and if the ruling of the trial court which accomplished this result was an act of discretion, then we think it was a discretion not fairly or equitably exercised. However, we are inclined to believe that the judgment denying such credit was based on or greatly influenced by mistake of law in respect to the necessity of praying for a specific credit, and in respect to what constitutes a liquidated claim. Under these circumstances it was not a true exercise of discretion on the part of the chancellor. See State ex rel. State Highway Comm. v. Bloomfield Tractor Sales, Inc., Mo.App., 381 S.W.2d 20.

An equity case we try de novo, giving due deference and regard to the judgment of the chancellor who heard the witnesses in respect to credibility, and render such judgment as should have been rendered. It is our conclusion that the amount of $5,900 allowed the respondents for rental value of the premises while in possession of the appellants should be reduced by the sum of $3,038.41, which is an amount corresponding to interest at six per cent on the three payments of principal made from date of such payments until date of judgment below. The judgment is reversed in part and remanded with direction that it be modified so as to accord with the views herein expressed.

STONE and HOGAN, JJ., concur.

      . It is conceded by all parties to bave been June 6, 1960, when Sellers went back into possession, and, therefore, the period they were out of possession after foreclosure was two months and eleven days.

      . 30 C.J.S. Equity § 607, p. 1001; Woods v. Cantrell, 358 Mo. 1006, 218 S.W.2d 613, 616; Wenzelburger v. Wenzelburger, Mo.App., 296 S.W.2d 163; Kleber v. Carlos, Mo., 202 S.W.2d 865, 869; McQuitty v. Steckdaub, Mo., 190 S.W. 590, 592; Homan v. Employers Reinsurance Corp., 345 Mo. 650, 136 S.W.2d 289, 301, 127 A.L.R. 163; see Gibson v. Shull, 251 Mo. 480, 158 S.W. 322, where interest was adjudged although not prayed for.

      . St. Louis Housing Authority v. Magafas, Mo., 324 S.W.2d 697; Wolfersberger v. Miller, 327 Mo. 1150, 39 S.W.2d 758 (16).

      . 47 C.J.S. Interest § 19b, p. 31; Eastmount Const. Co. v. Transport Mfg. & Equip. Co. (8th Cir.), 301 F.2d 34; Laughlin v. Boatmen’s Nat. Bank of St. Louis, 354 Mo. 467, 189 S.W.2d 974, 979; Wolfersberger v. Miller, 327 Mo. 1150, 39 S.W.2d 758, 765.

      . Vannorsdel v. Thompson, Mo.App., 323 S.W.2d 252; Eastmount Const. Co. v. Transport Mfg. & Equip. Co. (8th Cir.), 301 F.2d 34(12).

      . 47 C.J.S. Interest § 13, p. 23; Napoleon Hill Cotton Co. v. Stix, Baer & Puller Dry Goods Co., 203 Mo.App. 25, 217 S.W. 323; Thompson v. W. C. Howard Motors Co., 122 Kan. 339, 252 P. 468.

      . Schroeder v. Zykan, Mo.App., 255 S.W.2d 105(6); Arthur v. Wheeler & Wilson Mfg. Co., 12 Mo.App. 335, 341; see Wolforsberger v. Miller, 327 Mo. 1150, 39 S.W.2d 758.


author: BELCHER, Commissioner.

text:
    Burt Critton HARP, Appellant, v. The STATE of Texas, Appellee.
    No. 37116.
    Court of Criminal Appeals of Texas.
    Oct. 21, 1964.
    George W. Morris, Conroe, for appellant.
    Frank Briscoe, Dist. Atty., Carl E. F. Dally, Cletus A. Davis and Theodore P. Busch, Asst. Dist. Attys., Houston, and Leon B. Douglas, State’s Atty., Austin, for the State.
   BELCHER, Commissioner.

Upon a trial before the Court without a jury, the appellant was convicted for driving while intoxicated; the punishment assessed by the Court was five (5) days in jail and a fine of $100.00.

The state’s witness DeFoor testified that about 2 or 2:30 A.M. while he was driving his Plymouth automobile on Public Highway, U.S. 59, which is a public highway in Harris County, a Ford automobile was driven onto the highway in front of his automobile, causing a collision.

Officer Smith, Texas Highway Patrolman, testified that in response to a telephone call about 2:45 A.M., he arrived at the scene of a collision between a Plymouth and a Ford on a public highway about 3:10 A.M.; that there were skid marks on the highway, the Ford was in the ditch, and both automobiles had been damaged; and that upon arriving at the scene, he asked who was driving the Ford, and the appellant, who was present at the scene, then “identified himself as the driver.” He further testified that when he asked appellant for his driver’s license “he thought he was acting a little differently than normal people”, and “He (appellant) had a strong odor of alcoholic beverage on his breath,” and based upon his observations of the appellant, he expressed the opinion that he was intoxicated.

The appellant did not testify or offer any evidence.

Appellant contends that the state failed to prove venue. According to the record no issue as to venue was raised prior to the filing of the motion for new trial. Therefore, under the provisions of Art. 847, Vernon’s Ann.C.C.P., this Court will presume that venue was proven. Masters v. State, 165 Tex.Cr.R. 303, 306 S.W.2d 355; Doyle v. State, 168 Tex.Cr.R. 458, 329 S.W.2d 286; Goad v. State, 171 Tex.Cr.R. 371, 350 S.W.2d 548 and Hatfield v. State, Tex.Cr.App., 377 S.W.2d 647.

Appellant’s presence at the scene of the collision and his admission to Officer Smith at the scene, that he was driving the Ford, together with the facts and circumstances above summarized, are sufficient to corroborate his extrajudicial confession to Officer Smith that he was the driver of the Ford. Green v. State, 164 Tex.Cr.R. 330, 299 S.W.2d 134; Fancher v. State, 167 Tex.Cr.R. 269, 319 S.W.2d 707.

The intoxication of the appellant was sufficiently shown by the testimony of Officer Smith.

The evidence is sufficient to support thé conviction.

The judgment is affirmed.

Opinion approved by the Court.


author: DICE, Commissioner. McDonald, judge.

text:
    Dr. Stuart G. McKENZIE, Appellant, v. The STATE of Texas, Appellee.
    No. 36777.
    Court of Criminal Appeals of Texas.
    April 22, 1964.
    Rehearing Denied June 24, 1964.
    Second Motion for Rehearing Denied Oct. 14, 1964.
    John J. C. O’Shea, Lubbock, Blanchard, .Clifford, Gilkerspn •&..Smith, Lubbock (on appeal only) by George Gilkerson, Lubbock, for appellant.
    Fred E. West, County Atty., Broadus A. Spivey and Wm. Quinn Brackett, Asst. County Attys., Lubbock, and Leon B. Douglas, State’s Atty., Austin, for the State.
   DICE, Commissioner.

The conviction is under Art. 726d, Vernon’s Ann.P.C., for the unlawful delivery of a dangerous drug; the punishment, twenty-one months in jail and a fine of $3,000.

Appellant was a duly licensed and practicing doctor of osteopathy in the city of Lubbock. In November, 1962, the state’s witness Kenneth Decker, who was an .undercover agent for the narcotics division of the Department of Public Safety, went to Lubbock to investigate narcotics violations in the city. On November IS, Decker went to the appellant’s office on 34th Street with another person who introduced him to appellant. At such time, both Decker-and his companion purchased some pills (bennies) from appellant. On November 21, Decker returned to appellant’s office. He testified that immediately upon his arrival in. the office appellant appeared and asked that he come to the back. They proceeded to a back office and after appellant shut the door he said: “ ‘What do you want ?’ ” and Decker replied: “ ‘Well, what do you have?,”’ to which appellant replied: “T don’t have any of those dexedrine spansules. * * * I’m getting pretty low. * * * I have got some obedrin. * * * How many do you want?”’ Decker replied: “ ‘ * * * about a hundred,’ ” and appellant then reached over on a table, got a bottle of tablets and a small box, poured the box full of tablets, and asked the witness his name. Decker gave him a fictitious name, which appellant wrote on the box and then delivered the box to Decker, who in turn gave appellant $5. Decker stated that in the conversation appellant said “he was having to be a little more careful * * * he was having to pull up some on his dealing because a little heat was on * * and that appellant did not discuss the witness’s physical. condition or examine him , at the time the tablets were delivered. He further identified as state’s exhibit 1 the box of ninety-four tablets that appellant delivered to him, which bore the following label: “Stuart G. Mackenzie, D. O., 1703 34th St. —SH 4 — 2902, Lubbock, Texas. Directions: Fred Morgan, Sig. One B & D, S. G. Mackenzie, D. O., 11-21-62, K. D.” The witness further testified that some two or three days after November 21, he returned to appellant’s office but did not purchase anything from him when appellant stated “he wasn’t doing any business * * * the heat was on and he was going to have to pull up * * * for awhile * *

Decker testified that it was his duty as an undercover agent to obtain evidence in the commission of crimes and that in his dealings with appellant there was no doctor-patient relation but only that of buyer and seller. He further stated that on the occasion in question he was accompanied by Agent Bob Richards and Deputy Sheriff Jack Bryant, who remained outside in an automobile with an electronic receiver and tape recorder which recorded, by radio signal, the conversation between him (Decker) and the appellant, through a portable mina-ture transmitter concealed in the witness’s pocket. At the trial, the tape recording was played to the jury and was introduced in evidence after being identified by Agent Richards as fairly representing the conversation which he had heard over the transmitter between appellant and Agent Decker on November 21.

It was shown that the box of ninety-four tablets delivered by appellant to Agent Decker was taken directly by him to Chemist Charles Beardsley, of the Texas Department of Public Safety, for examination. Chemist Beardsley identified the tablets as those sold under the trade name of “obe-drin” for weight control and appetite appeasers. He stated that he made a spectro-photometric analysis of four of the tablets picked at random, which revealed that they contained amphetamine and barbituric acid derivative.

Testifying in his own behalf, appellant stated that on November 21, Decker came to his office and purported to be a man who traveled and was in need of something to keep him awake. Appellant stated that on such occasion and in the course of his practice he dispensed the tablets in good faith, as medication, to Decker, who held himself out as a patient.

Witnesses were also called by appellant who testified that his reputation for being a peaceable and law-abiding citizen was good.

The court in his charge defined the terms “ ‘dangerous drug,’ ” “ ‘delivery,’ ” “ ‘patient,’ ” and “ ‘practitioner,’ ” substantially as defined in Art. 726d, supra, and instructed the jury that under the statute “the delivery of any dangerous drug is unlawful unless delivered by a practitioner in the course of his practice and the immediate container in which such drug is delivered bears a label on which appears the directions for use of such drug, the name and address of such practitioner, and the name and address of the patient.”

Appellant challenges the sufficiency of the evidence to support the conviction, upon three grounds:

It is first contended that because Agent Decker was acting as an agent and employee of the State of Texas in the transaction, no offense was committed, by virtue of Sec. 4 of Art. 726d, supra, which provides, in part, that:

“The provisions of paragraphs (a) and (d) of Section 3 shall not be applicable :
“(a) As to the delivery of dangerous drugs to persons included in any of the classes hereinafter named * * * for use in the usual course of their business or practice or in the performance of their official duties, as tile case may be * * * (b) (5) Officers or employees of Federal, State, or local government * *

We are unable to agree that this provision of the statute was intended by the legislature to be applicable to the delivery of a dangerous drug to an undercover agent of the Department of Public Safety who, at the time, was engaged in the detection of narcotic law violations in this state. Such an agent is not within the class of persons to whom delivery of a dangerous drug is made lawful under this section of the statute.

It is next contended that the evidence is insufficient to support the conviction because the proof shows that the tablets were delivered by appellant in the course of his practice.

Reliance is had upon certain provisions of Sec. 3 of Art. 726d, supra, which reads:

“The following acts, the failure to act as hereinafter set forth, and the causing of any such act or failure are hereby declared unlawful, except as provided in Section 4:
“(a) The delivery of any dangerous drug unless: * * *
“(2) Such dangerous drug is delivered by a practitioner in the course of his practice and the immediate container in which such drug is delivered bears a label on which appears the directions for use of such drug, the name and address of such practitioner, the name and address of the patient, and, if such drug is prescribed for an animal, a statement showing the species of the animal.”

It should first be pointed out that the label on the container delivered to Agent Decker did not show his address, as required by this section of the statute.

Whether appellant delivered the tablets to Agent Decker as a practitioner in the course of his practice was a disputed issue in the case. According to Agent Decker’s testimony, there was no doctor-patient relationship between them but only the relationship of buyer and seller. Under appellant’s testimony, the relationship was doctor and patient and he delivered the tablets in the course of his practice. The jury, by their verdict, resolved the issue against appellant.

Appellant, although relying upon Sec. 3(a) (2), which makes lawful the delivery of a dangerous drug by a practitioner in the course of his practice, insists that such section of the statute which does not define the phrase “in the course of his practice” is so indefinite as to render the statute void and wholly inoperative.

With this contention we do not agree. In the recent case of King v. State, 166 Tex.Cr.R. 230, 312 S.W.2d 501, we upheld, as valid, Art. 726c, V.A.P.C., containing similar provisions, now repealed, against a like attack.

Appellant lastly contends that the evidence is insufficient to show that the obedrin tablets were a dangerous drug, within the meaning of that provision of Sec. 2(a) of the act which reads:

“Provided, however, that preparations which contain certain other drugs, not covered by the provisions of this Act, other than those dangerous drugs specified in Section 2(a) (2) through (11) inclusive, in sufficient proportion to confer upon the preparation qualities other than those possessed by the dangerous drugs alone are exempt from the provisions of this Act.”

While Chemist Beardsley admitted he did not run a quantitative test to determine the quantity of dangerous drugs in each tablet, there was no evidence of the existence of any other drugs in the tablets. The quoted provision of Section 2(a) (2), supra, is therefore not here applicable. The chemist testified that the obedrin tablets contained amphetamine and a barbituric acid derivative, which is a dangerous drug under the provisions of Sec. 2(a) (1) and (2) of Art. 726d, supra. We find the evidence sufficient to support the conviction. / Appellant complains that the court erred in failing to submit his requested charge on entrapment as a defense in the case. Reliance is had upon the rule stated in Cooper v. State, 162 Tex.Cr.R. 624, 288 S.W.2d 762, and other cases by this court, that “if the criminal design originates in the mind of the officer and he induces a person to commit a crime which he would not otherwise have committed except for such inducement, this is entrapment, and in law may constitute a defense to such crime.”

We have carefully reviewed the record and conclude that the issue of entrapment was not raised. In his testimony, appellant’s claim was that he delivered the drug as a practitioner in the course of his practice. The testimony of Agent Decker did not raise the issue of entrapment. In .refusing to submit such issue to the jury, the court did not err. Cooper v. State, supra; Aguero v. State, 164 Tex.Cr.R. 265, 298 S.W.2d 822; Viley v. State, 163 Tex.Cr.R. 348, 290 S.W.2d 674.

Appellant’s remaining contention is that the court erred in permitting the evidence showing the prior delivery by him to Agent Decker and the other person, on November 15, of certain dangerous drugs, and in not limiting the jury’s consideration of such evidence in his charge.

An examination of the record reflects that no objection was made by appellant to the admission of the evidence and no request was made of the court to limit the jury’s consideration thereof. The contention is overruled.

The judgment is affirmed.

Opinion approved by the Court.

ON APPELLANT’S MOTION FOR REHEARING

McDonald, judge.

Appellant’s very able attorney in his motion for rehearing herein, still contends that the trial court erred in failing to submit appellant’s requested charge on entrapment.

We have again considered the cases cited by appellant in this regard and find no fault with the law found therein. However, we must still conclude that the evidence presented in the instant case did not warrant the charge requested.

Remaining convinced that our original opinion properly disposed of this cause, appellant’s motion for rehearing is overruled.


author: BARROW, Justice.

text:
    UNITED STATES FIDELITY AND GUARANTY COMPANY, Appellant, v. MILK PRODUCERS ASSOCIATION OF SAN ANTONIO et al., Appellees.
    No. 14275.
    Court of Civil Appeals of Texas. San Antonio.
    Sept. 23, 1964.
    Rehearing Denied Oct. 21, 1964.

      House, Mercer, House & Brock, San Antonio, for appellant.
    W. W. Fowlkes, San Antonio, for ap-pellees.
   BARROW, Justice.

This is a garnishment action. The question presented is whether the garnished funds were special community property of Jean C. Moore, and exempt from liability for the debt of her husband, Guy E. Moore, under Art. 4616, Vernon’s Ann.Civ.St.

Appellant owned a personal judgment against Guy E. Moore and brought this action to garnish funds held by Milk Producers Association in the name of Jean C. Moore. These funds represented revenue from the April, 1962, milk runs. Jean C. Moore- intervened and asserted that the funds were her special community property. After a non-jury trial, judgment was entered denying appellant any recovery against garnishee or the funds held by it.

Findings of fact and conclusions of law were filed wherein the trial court found that the funds were the special community property of Jean C. Moore. Findings were made that: the dairy herd was started as her separate property; on May 10, 1957, Guy E. Moore executed a bill of sale of his interest in the dairy business to his wife as her separate property; her disabilities of coverture were removed for mercantile and trading purposes on October 29, 1957, and she thereafter operated the dairy business as her own and kept the earnings from same in a separate bank account, to which [her husband had no access. The court further found that the dairy was operated on a farm purchased by Jean C. Moore in July, 1959, in Gonzales County, as her separate property, and that the subsequent payments on the farm were made from her separate bank account. The court concluded that the funds were the special community property of Jean C. Moore, and therefore not subject to garnishment for the judgment debt against her husband.

Appellant has attacked each of these findings and urges that as a matter of law the funds were community property and were not exempt from the debt of Guy E. Moore.

The funds in the hands of garnishee were revenues from the sale of milk and were community property regardless of whether or not Jean C. Moore was operating the dairy as her separate property and estate. Art. 16, § 15, Vernon’s Ann. Tex.Const;Art. 4619, Vernon’s Ann.Civ.St. However, the personal earnings of the wife and revenues from her separate property are special community property and are not liable for the husband’s debts. Art. 4616, Vernon’s Ann.Civ.St.; Moss v. Gibbs, 370 S.W.2d 452 (Tex.1963).

There is evidence tending to show that the original dairy herd, which was bought in 1952, was the separate property of Mrs. Moore. In any event, in 1957, Guy E. Moore conveyed his entire interest in the dairy herd and dairy equipment to Jean C. Moore as her separate property. The testimony of Jean C. Moore supports the trial court’s findings that Jean C. Moore’s disabilities of coverture were removed and that she thereafter operated the dairy business alone and as her separate property. Guy Moore operated a truck line (out of which business the debt supporting the judgment arose) until he became incapacitated from a stroke in 1960. He took no part in the dairy operations, other than ordering feed on one occasion. All income from the dairy was kept in a separate hank account to which only Jean C. Moore had access.

The Gonzales County farm, where the dairy was operated, was purchased in 1959, and the deed recited that the consideration was paid by Jean C. Moore from her separate estate and the property was conveyed to her individually. The recitations of the deed established a presumption that the property was acquired as the separate estate of the wife, although a note and deed of trust securing payment of the balance was executed by both Jean C. and Guy E. Moore. Hodge v. Ellis, 154 Tex. 341, 277 S.W.2d 900 (1963); Lindsay v. Clayman, 151 Tex. 593, 254 S.W.2d 777 (1952); Colden v. Alexander, 141 Tex. 134, 171 S.W.2d 328 (1943).

The evidence establishes that the dairy herd remained about the same' size from 1957 through 1962. It was necessary, however, to replace the cows from time to time, and this was done either by the purchase of new ■ cows or with the increase from the original herd. Also, during this period of time the dairy business was heavily encumbered and it was necessary for money to be frequently borrowed. On each occasion a note and chattel mortgage were signed by Jean C. Moore followed by the signature of her husband. The evidence is undisputed that all payments on the note given for the purchase of the farm, as well as on the various notes for operating capital, were made from the proceeds of sale of milk, and, where these were insufficient, from gifts to Jean C. Moore from her sister. Appellant urges that the foregoing evidence is such as to destroy the separate property status of the dairy business.

The special community status was never destroyed. It is seen that all revenues from the dairy were put back into same by Jean C. Moore. This would not be a mutation of the revenues so as to destroy the special community property status of the revenues. Moss v. Gibbs, supra; Hawkins v. Britton State Bank, 122 Tex. 69, 52 S.W.2d 243 (1932); 42 T.L.R. 385.

Further, the pledge of community credit by Guy E. Moore’s signing various notes did not destroy the separate property status of the dairy. In Dakan v. Dakan, 125 Tex. 305, 83 S.W.2d 620 (1935), the rule is set forth, that “where a spouse improves his or her separate property with the funds belonging to the community estate, the other spouse, or his or her heirs, would be entitled to reimbursement out of his or her separate property, to the extent of their share of the community funds so used, and that their claim for such reimbursement is in the nature of a charge upon the property so improved.” It was further held, that “the principles of reimbursement in accounting between estates apply, without distinction, to both separate and community estates.” See also: Lindsay v. Clayman, supra; Colden v. Alexander, supra; Gleich v. Bongio, 128 Tex. 606, 99 S.W.2d 881 (Com.App., 1937); 30 Tex. Jur.2d, Husband & Wife, § 134.

In Armstrong v. Turbeville, Tex.Civ.App., writ dism., 216 S.W. 1101, the court recognized that, in the absence of fraud, the husband and wife may intend that the borrowed money be for the benefit of the wife’s separate property, although the husband also signed the note and pledged his separate property to secure the loan. See also: Sorenson v. City Nat. Bank, Com.App., 121 Tex. 478, 49 S.W.2d 718.

The trial court properly concluded that the garnished funds were the special community property of Jean C. Moore and therefore not liable for the judgment debt against her husband.

The judgment is affirmed.

      . “Art. 4616. Wife’s separate property protected
      “Neither the separate property of the wife, her personal earnings, nor the revenue from lier separate property shall "be subject to the payment of debts contracted by the husband nor claims arising out of the torts of the husband.”