author: CULLEN, Commissioner.

text:
    Mary Edith SPILLMAN et al., Appellants, v. Emerson BEAUCHAMP, etc., et al., Appellees.
    Court of Appeals of Kentucky
    Nov. 9, 1962.

      Bruce R. Hamilton, LaGrange, for appellants.
    John B. Breckinridge, Atty. Gen., Walter Herdman, Asst. Atty. Gen., William G. Mullins, Dept, of Public Safety, Frankfort, for appellees.
   CULLEN, Commissioner.

Mary Edith Spillman and Charles Ash-brook brought an action for damages against the Commissioner of the Department of Agriculture of Kentucky, three regular employes and two temporary employes of the department, an employe of the U. S. Department of Agriculture, and two state policemen. The defendants moved to dismiss on the grounds that the complaint did not state a claim upon which relief could be granted and that the court did not have jurisdiction of the subject matter. The court sustained the motion and entered judgment dismissing the action, from which judgment the plaintiffs have appealed.

The facts set forth in the complaint, if accepted as true, were sufficient to state several claims upon which relief could be granted, and presented issues of which the circuit court would have jurisdiction. However, in a “Memorandum in Support of Defendants’ Motion to Dismiss” filed in the circuit court the defendants set forth a statement of facts which they relied upon as exonerating them from liability or at the least creating issues of which the circuit court would not have jurisdiction. Apparently the circuit judge accepted this statement of facts in ruling on the motion to dismiss. In so doing he erred.

It is true that CR 12.02 provides that if, on a motion to dismiss on the ground that the complaint fails to state a claim on which relief can be granted, “matters outside the pleading” are presented to and not excluded by the court, the motion shall be treated and disposed of as one for summary judgment. But statements of fact in a legal memorandum are not within the category of “matters outside the pleading” contemplated by the rule. United States v. Tuteur, 7 Cir., 215 F.2d 415. They lack the ceremonial quality of testimony in open court which may be found in depositions, admissions or affidavits. Sardo v. McGrath, 90 U.S.App.D.C. 195, 196 F.2d 20. Furthermore, a summary judgment is not to be granted unless the pleadings, depositions, admissions and affidavits on file show that there is no genuine issue as to any material fact, CR 56.03. Here, even if the statement of facts in the defendants’ memorandum were entitled to be considered, some of the facts in the statement controverted fact allegations of the complaint, so as to establish, rather than negative, the existence of genuine issues of material facts.

A strict adherence to the rules of civil procedure would demand that the judgment here be reversed outright, because the allegations of the complaint, which stated several claims for relief of which the circuit court would have jurisdiction, were not in any way nullified procedurally by the defendants’ memorandum in support of motion to dismiss. But the parties in arguing the case on appeal have treated certain questions as having properly been placed in issue, and we believe the progress of this litigation will be expedited if we dispose of those questions. So we shall.

One claim stated in the complaint was that the defendants wrongfully and maliciously entered upon the plaintiffs’ farm and unlawfully, wrongfully and illegally converted, stole, removed and killed the plaintiffs’ cow. In the statement of facts set forth in their memorandum in support of motion to dismiss, the defendants stated that they did enter upon the plaintiffs’ farm, remove the cow and cause it to be killed, but in so doing they acted as officers and agents of the Kentucky Department of Agriculture under authority of and pursuant to the statutes relating to control and eradication of communicable diseases of livestock; that the cow had been tested by a veterinarian of the department and found to be suffering from Bang’s Disease; that the plaintiffs had been ordered by the department to destroy the cow but had refused to do so; and the defendants in taking and killing the cow had acted under a specific order of the Commissioner of Agriculture directing such action.

The primary issues submitted on the appeal are whether the Department of Agriculture has statutory authority to kill an animal suffering from a communicable disease; whether (if such authority exists) the killing may be done summarily upon an ex parte determination by the department that the animal has the disease; whether, in the event of such a summary killing, the officers and agents who do the killing are personally liable in an action in the courts if it later is proved that the animal did not in fact have the disease; and whether, if they are so liable, the liability may be enforced by action in the courts or is enforceable only by proceedings before the Board of Claims under KRS 44.070 to 44.160.

We have no difficulty in concluding that the statutes governing control and eradication of communicable diseases of animals (even before the 1962 amendment to KRS 246.210) granted authority to the Department of Agriculture to kill diseased animals. KRS 246.210 authorized entry upon premises for the purpose of “in any way combating communicable diseases among livestock.” KRS 257.020 gave the State Board of Agriculture power to “prevent, control and eradicate” any communicable disease of livestock. KRS 257.-030 vested in the board full authority to adopt and enforce regulations necessary to accomplish the purpose of the livestock disease laws. KRS 257.110 specifically provided for the slaughtering of diseased animals. (It is true that the latter section contemplates an appraisal procedure before the slaughtering in which the owner of the animal shall participate, but a reasonable construction of the statute would be that if the owner refuses to participate the appraisal and slaughtering may be carried on without his participation.)

The appellants maintain that even if the department does have statutory authority to kill a deceased animal, the killing may not be done summarily upon an ex parte determination by the department that the animal is diseased. The argument is that the owner is entitled under the Constitution to a hearing before the animal is killed. But the law is all to the contrary. The rule is firmly established that under the police power the government may cause the summary killing of an animal believed to be diseased, without giving the owner a prior hearing. All that is required by way of due process is that the owner be given the opportunity subsequently to litigate the question of whether the animal was in fact diseased, and be provided a remedy in damages in the event it is proved that the animal was not diseased. See Neer v. State Live Stock Sanitary Board, 40 N.D. 340, 168 N.W. 601; Loftus v. Department of Agriculture, 211 Iowa 566, 232 N.W. 412; Pearson v. Zehr, 138 Ill. 48, 29 N.E. 854; Affonso Bros. v. Brock, 29 Cal.App.2d 26, 84 P.2d 515.

The most difficult question presented concerns whether the officers and agents who do the killing are personally liable in damages in the event it is determined in judicial proceedings subsequent to the killing that the animal was not in fact diseased.. It appears that in practically every case in other jurisdictions where the question has been specifically presented personal liability has been imposed. See Lowe v. Conroy, 120 Wis. 151, 97 N.W. 942, 66 L.R.A. 907; Loftus v. Department of Agriculture, 211 Iowa 566, 232 N.W. 412; Miller v. Horton, 152 Mass. 540, 26 N.E. 100, 10 L.R.A. 116; Pearson v. Zehr, 138 Ill. 48, 29 N.E. 854; Affonso Bros. v. Brock, 29 Cal.App.2d 26, 84 P.2d 515; North American Cold Storage Co. v. Chicago, 211 U.S. 306, 29 S.Ct. 101, 53 L.Ed. 195.

Although some of the decisions based liability on the theory that the officer or agent acted beyond the scope of his authority in killing an animal not in fact diseased (it being reasoned that the statutes authorized only the killing of actually diseased animals), it is reasonably apparent that the real basis (frankly admitted in some of the opinions) was that the owner was entitled to damages from someone for the wrongful taking of his property, and since the state by virtue of governmental immunity was not amenable to suit the burden of payment would have to fall on the officer or agent. For example, in Lowe v. Conroy, 120 Wis. 151, 97 N.W. 942, 66 L.R.A. 907, the court recognized the ordinary rule exempting a public officer from personal liability for acts done within the scope of his official duties, but announced that there must be an exception in cases where private property has been taken because otherwise the owner would have no remedy against the invasion of his constitutional rights of property.

We are not at all sure that in the kind of situation under discussion the state itself would not be liable in damages. If the killing of the cow falls into the category of a wrongful taking of property for public purposes, a basis for liability might exist under the principle announced in such cases as Commonwealth v. Kelley, 314 Ky. 581, 236 S.W.2d 695, and Keck v. Hafley, Ky., 237 S.W.2d 527. Furthermore, liability and appropriate remedial procedure perhaps might exist under the Board of Claims Act, KRS 44.070 to 44.160.

In any event we are not convinced that the personal liability of a public officer or agent for acts done within the scope of his authority should be predicated simply on the absence of a remedy against the government for which the officer or agent acts. It seems to us that in order to impose personal liability there should be some element of personal fault on the part of the officer or agent, such as negligence or deliberate wrongdoing.

The ordinary rule is that a public officer when acting in good faith within the scope of his authority is not personally liable for damages sustained by a member of the public as a result of his action, unless he acted negligently, that is, failed to meet the standard of the ordinarily prudent man. 67 C.J.S. Officers § 125, pp. 417, 418; J. F. Schneider & Son v. Watt, Ky., 252 S.W.2d 898. In our opinion this is a proper rule, and if under a particular set of facts liability would not exist under this rule liability should not be imposed on the officer simply because the government cannot be made to pay.

If, as has been assumed for the purposes of this discussion, the defendants in this case acted in good faith in carrying out their duties under the statutory system for control and eradication of communicable diseases of animals, and they were not chargeable with any knowledge that would have led a reasonable man to question the correctness of the veterinarian’s diagnosis that the animal was diseased, it is our opinion that the defendants could not be held personally liable even if it should eventually be proved that the cow was not in fact diseased.

The complaint alleges, however, that prior to the time the defendants caused the cow to be killed a judgment had been entered in an action in the circuit court, brought by the Department of Agriculture, adjudging that the department had no authority to kill the cow and finding that the cow was not in fact diseased. The complaint further alleges that the defendants killed the cow in willfull and malicious defiance of the judgment.

Of course if the foregoing allegations are true they will furnish a basis for imposing personal liability upon the officers, because the allegations show a lack of good faith, an absence of reasonable grounds for the officers to believe the cow to be diseased, and the existence of aspects of a deliberate flaunting of legal rights.

The foregoing discussion has been addressed to those features of the case relating to the killing of the cow. However, a further, separate claim for relief also is alleged in the complaint.

The complaint alleges that the defendants with malice and without probable cause swore out a warrant charging the plaintiffs with the nonexistent offense of “interfering with the orders of the Department of Agriculture,” and that the plaintiffs were arrested on that warrant and confined for a period of time; that the charge was false and was eventually filed away.

Applying the test hereinbefore laid down in this opinion, the imposition of personal liability upon the defendants under the latter allegations would require proof that the defendants did not act in good faith or did not act as reasonably prudent men. There is an offense, under KRS 257.990 (10), of hindering an agent of the Board of Agriculture in carrying out the duties assigned to him, and if the defendants here had reasonable grounds for preferring charges of that offense against the plaintiffs, and they acted in good faith, we would not think that a mistake in the technical wording of the charge preferred would furnish a basis for imposition of personal liability. See 67 C.J.S. Officers § 125, p. 418.

The appellees have argued that even if there exists a basis for personal liability on their part it can be enforced only by proceedings under the Board of Claims Act, KRS 44.070 to 44.160, and not by action in the circuit court. However, we do not find in the Board of Claims Act any evidence of an intent that it should apply to claims against a state officer or agent individually.

The judgment is reversed for further proceedings in conformity with this opinion.


source: Caselaw Access Project

author: MOREMEN, Judge.

license: Public Domain

text:
    Mary Sue Lynn HARGROVE, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Court of Appeals of Kentucky.
    Nov. 9, 1962.

      W. J. Postlethweight, Marion, for appellant.
    John B. Breckinridge, Atty. Gen., Martin Glazer, Asst. Atty. Gen., for appellee.
   MOREMEN, Judge.

Appellant, Mary Sue Lynn Hargrove, pled guilty in the Crittenden Circuit Court to an indictment for child desertion. Her punishment was fixed at one year’s confinement in the state penitentiary. The court suspended entry of the judgment and imposition of the sentence, and placed her on probation. The conditions of the probation were that appellant:

1. Avoid injurious habits.
2. Avoid persons or places of disreputable or harmful character; and not violate any laws of this Commonwealth.
3. Report to the Probation Officer as directed and permit the Probation Officer to visit her at her home or elsewhere.
Remain in the jurisdiction of the Court unless given written permission by the Court or Probation Officer to go elsewhere.
Work faithfully at suitable employment and support her dependents to the best of her ability.
Gather her family together, and provide said family with a suitable and proper home and in this endeavor she shall cooperate fully with the Department of Child Welfare.

In June 1962 the Commonwealth’s attorney filed a motion to set aside the order suspending sentence for the reason that appellant had violated the conditions of her probation order. A bench warrant was issued and she was arrested.

The court, on its own motion, appointed Hon. W. J. Postlethweight as counsel for appellant and he accepted the appointment in open court. Appellant, by counsel, moved that the court overrule the motion of the Commonwealth for the following reasons :

(1) That the motion to revoke probation did not state in what manner the probationer had violated her probation.
(2) That under Section 11 of the Constitution of Kentucky she is guaranteed the right to be heard by herself and by counsel of her own choosing, and since the counsel assigned to her had been appointed by the court, he was an officer of the Commonwealth and therefore represented the interest of the Commonwealth, and not the interest of the appellant.
(3) That appellant’s attorney, Hon. W. J. Postlethweight, should be discharged from his appointment because he was required to use his time and legal talents without pay with the result that his property was being applied to public use without just compensation in violation of the provisions of Section 13 of the Constitution of Kentucky.

A full hearing was had upon the motion and appellant was given able and effective assistance at the hearing, and at subsequent proceedings in the case, by her appointed counsel. Witnesses, including the probation officer, testified for the Commonwealth and about twelve witnesses were introduced in behalf of appellant. The probation was revoked and judgment was entered.

It is argued that a motion to revoke probation should be as specific as is an indictment and should meet all requirements of Section 124 of the Criminal Code of Practice. We have been cited no authority to support the proposition. Sections 122 through 129 of the Code deal with the original indictments in criminal cases. They have no application here.

In Ridley v. Commonwealth, Ky., 287 S.W.2d 156, it was contended that the statutes mandatorily require as a condition of a hearing for revocation of probation that the probation officer submit a report as to the manner in which defendant had violated the terms of his probation; that he is not required to answer oral allegations of alleged misconduct, and that a written accusation similar to an indictment be presented. The Court said:

“Under our constitution the manner of probation must be by withholding entry of the judgment and suspending sentence. Lovelace v. Commonwealth, 285 Ky. 326, 147 S.W.2d 1029. In the first place, it is entirely within the discretion of the trial court whether a defendant shall be given his liberty conditionally. This is regarded as a privilege or a ‘species of grace extended to a convicted criminal’ for his welfare and the welfare of organized society. Darden v. Commonwealth, 277 Ky. 75, 125 S.W.2d 1031, 1033. Similar broad discretion rests in the court to revoke the probation both in respect to initiation of a hearing and the disposition thereof.”

In the case at bar probation had been granted upon special conditions which we have quoted and the charge that they had been violated was sufficient. In addition the proof shows that on several occasions appellant was warned that her misconduct would lead to a motion to revoke the probation.

In regard to appellant’s second contention that her constitutional rights were violated because she did not have counsel of her own choosing, we wish to state at the outset that we have grave doubts concerning whether the constitutional guarantee extends to a proceeding of this nature. However, if it does, the record does not show where she was denied the right to select her own counsel. The dictum that a defendant be afforded a fair opportunity to secure counsel of his own choice is most often supported by citation of the opinion in Powell v. State of Alabama, 287 U.S. 45, 53 S.Ct. 55, 77 L.Ed. 158, 84 A.L.R. 527. In that case and many cases which, followed, such as Roberts v. Commonwealth, Ky., 339 S.W.2d 640; United States v. Bergamo, 3 Cir., 154 F.2d 31, and cases cited therein, we find in each instance that the accused in some manner was refused the right to have a particular person to defend him, or reasonable opportunity to obtain the services of such an attorney. In the Powell case the court made a blanket appointment of all members of the bar to defend the accused and until the very morning of the trial no lawyer had been named or definitely designated to represent defendant. On the morning of the trial a lawyer from the Tennessee bar appeared and agreed to help out in the trial. The ultimate conclusion by the Supreme Court was that defendant did not in any real sense have the aid of counsel in preparation of the case. There must be some indication in the record that the accused attempted to make some selection of counsel. It was not shown here. The expression “counsel of one’s own choice” does not mean that the court is required to appoint counsel selected by the accused; it means, rather, that the accused has a right of his own volition to hire or otherwise obtain counsel and then be represented by that counsel at the trial.

We think that the contention that the assigned counsel becomes an officer of the Commonwealth and therefore represents the interest of the Commonwealth, and not that of the accused, is equally without merit. A regularly licensed attorney is always an officer of the court and therefore an officer of the Commonwealth. Beauchamp, Judge v. Cahill, 297 Ky. 505, 180 S.W.2d 423. All attorneys would be disqualified if appellant’s premise were sound.

Appellant’s final contention is that her attorney should have been discharged because his services were expropriated by the State. In Calhoun v. Commonwealth, 301 Ky. 789, 193 S.W.2d 420, we said:

“Although the Constitution of Kentucky confirms the right of freemen to be represented by counsel when charged with a felony (Section 11), which is interpreted as requiring the court to appoint an attorney for one who is unable to employ counsel, no provision has ever been made by the Commonwealth to compensate him as has been done in some of the other states. Provision has been made for the compensation of other officers of the court (KRS 28.460(1) (a), but not for a lawyer, who bears the heavier responsibility and performs a greater service, both in character and extent. The records are replete with services of appointed counsel as efficient and loyal as those rendered for substantial fees. Often lawyers have been imposed on by men able to pay them. Their only compensation is the sense of having contributed their talents and labors in a public service.”

In any event, if counsel has a claim this is not a suit in which it may be pressed.

We find no error in the proceeding and the judgment is affirmed.


author: DOERNER, Commissioner. PER CURIAM.

text:
    David R. WARTENBE, Loretta C. Wartenbe, John A. Wartenbe and Cledith D. DeNoon, Trustees of Wartenbe Filters, Inc., Plaintiffs-Appellants, v. CAR-ANTH MANUFACTURING AND SUPPLY COMPANY, Defendant-Respondent.
    No. 31228.
    St. Louis Court of Appeals. Missouri.
    Nov. 20, 1962.

      Wilder Lucas, Jack R. Mandel, St. Louis, for plaintiffs-appellants.
    Hocker, Goodwin & MacGreevy, John M. ‘Goodwin, St. Louis, for defendant-respondent.
   DOERNER, Commissioner.

Plaintiffs’ suit is one for alleged breach •of contract, in which they prayed for a judgment of $15,444. Defendant denied •generally and counterclaimed for $1632.97 for work performed. Trial before a jury resulted in a verdict and judgment in favor •of defendant on plaintiffs’ cause of action ■and in favor of plaintiffs on defendant’s ■counterclaim. Plaintiffs thereupon appealed to the Supreme Court, where the ■matter was briefed and argued. In their brief plaintiffs had asserted that the amount ⅛ controversy exceeded $15,000, but upon reviewing the record the Supreme Court found that plaintiffs had submitted the case ■to the jury upon an expressed request for .a verdict of $9,122.82. It thereupon determined that it lacked jurisdiction and transferred the appeal here.

Since the merits of the controversy are not involved in the points raised on appeal a brief statement of the factual background will suffice. On or about October 1, 1953, Wartenbe Filters, Inc. was awarded a contract to furnish 961 oil filters to F. H. Ma-graw and Company. Wartenbe Filters did no manufacturing, and arranged to obtain the component parts of the oil filters from various suppliers, including top cover castings made of aluminum, and plug castings made of bronze, from Bodine Foundry. About October 2, 1953, it obtained a written bid from the defendant to machine these castings in a certain manner. On October 23, 1953 Wartenbe Filters gave defendant a purchase order for the work, which defendant accepted. Under the contract thus made defendant agreed to machine 975 aluminum top cover castings for the price of $149.12 per hundred, and 975 bronze plug castings for the price of $62.50 per hundred. We gather from the testimony that the work included the machining of a recess in the cover casting into which the plug was to be seated, and the purchase order contained the provision: “Valve cylinder in cover and valve plug to be lapped for leak proof fit. Each cover with plug lapped in to be kept together by washer and nut furnished. ⅜ * ⅝ »

Plaintiffs’ evidence was that after defendant had completed its work on a few of the covers and plugs they were tested by Wartenbe Filters with water under pressure and found to leak. Defendant’s further efforts to lap in the plugs so as to obtain a leak-proof fit were unsuccessful, and, according to plaintiffs’ evidence, defendant told Wartenbe Filters to take the work elsewhere. Wartenbe Filters attempted to find another supplier who would do the work, and one of three firms which subsequently tried to obtain a leak-proof fit, the Small Manufacturing Company, finally devised a method which achieved that result on two or three assemblies. However, plaintiffs’ evidence was further to the effect that a sufficient volume of production to meet Wartenbe Filters’ deadline could not be realized by this method and that it eventually substituted a top cover casting made of cast iron for that of aluminum.

This action was filed by Wartenbe Filters, Inc., on November 21, 1955. At that time it was a Missouri corporation, in good standing, and it remained so until January 1, 1958, when the Secretary of State forfeited its charter for failure to register and file the anti-trust affidavit as required by Chapter 351 RSMo 1959, V.A.M.S. Plaintiffs, as the then directors and officers in office, who became trustees of the corporation by virtue of Section 351.525, were thereupon substituted as plaintiffs.

Defendant tacitly admitted that it had not performed the contract, and the basis of its defense was impossibility of performance. According to its evidence, a leak-proof fit could not be obtained or retained between the bronze plug and the aluminum casting because the plug, being made of the harder metal, galled and scored the softer aluminum casting. Plaintiffs denied the claimed impossibility of performance, and pointed to one leak-proof assembly achieved by David Wartenbe, one of the plaintiffs and the former president of Wartenbe Filters, Inc., and to the two or three made by Small Manufacturing Company. Thus the decisive issue of fact was a relatively simple one.

We are not asked to pass upon the merits of the defense asserted below. Plaintiffs’ primary complaint on appeal is that they were deprived of a fair trial. They contend that this resulted, first, because the court permitted defendant to cross-examine War-tenbe about certain partially paid bills; and second, because of various prejudicial comments, remarks and arguments made by counsel for defendant. Their only other point is that Instruction No. 2, given at the request of defendant, was prejudicially erroneous.

As to the first part of plaintiffs’ primary complaint, on direct examination plaintiffs’ witness David Wartenbe enumerated various expenses for merchandise and labor which plaintiffs claimed were incurred because of defendant’s breach of contract. On cross-examination defendant developed, without objection, that there were some accounts for merchandise that had not been paid in full. Defendant then inquired what had happened to the machinery and other physical assets of Wartenbe Filters, plaintiffs objected, and a long and involved colloquy occurred out of the hearing of the jury. This ended with defendant’s claim that it was entitled to know whether the bills had been paid (although that subject had nothing to do with the question propounded), and the court commented, “Yes. He may answer.” Defendant then questioned Wartenbe further about various bills, and developed that certain other accounts had been only partially paid.

We have painstakenly searched the record and have failed to find any objection by plaintiffs to defendant’s line of inquiry, which of itself would bar plaintiffs’ complaint on appeal. Furthermore, plaintiffs cite no authority holding that such cross-examination was improper, nor have we found any. Of course, if such debts were incurred and were properly attributable to defendant’s breach of contract, then plaintiffs were entitled to recover for them whether or not they had paid them. Curtis v. McNair, 173 Mo. 270, 73 S.W. 167; Orf v. Ostmann, Mo.App., 170 S.W.2d 941; Patterson v. Springfield Traction Co., 178 Mo.App. 250, 163 S.W. 955. At plaintiffs’ request, the court instructed the jury to that effect. We find no merit in plaintiffs’ contention.

A proper consideration of the second part of plaintiffs’ complaint requires a further statement of facts. In their petition plaintiffs alleged that Wartenbe Filters had agreed to furnish the oil filters to the Ma-graw Company for $31,059.52; that its actual cost was $32,434.24; that its cost would have been only $18,489.84 had defendant performed its contract; and that Wartenbe Filters had therefore suffered damages in the sum of $13,944.40. When plaintiffs sought to prove their damages by showing these over-all figures defendant repeatedly objected that the proper measure of damages was the additional costs, if any, incurred by Wartenbe Filters in having others do the work on the two parts which defendant had contracted to do, and not the over-all costs of obtaining and assembling the various other parts which went to make up the filter. After a conference in chambers on the subject, plaintiffs seemingly agreed with defendant’s contention and thereafter developed from witness War-tenbe their evidence on damages in accordance with that theory.

However, when defendant cross-examined Wartenbe it returned to the over-all figures and obtained from him the admission that the claimed total cost of $32,434.24 included the cost of replacing certain patterns which had been destroyed in a fire at the shop of another supplier; and that it also included the defendant’s unpaid bill of $1,-132.97 for work performed, for which defendant was counterclaiming. Defendant also brought out that plaintiffs’ claimed out-of-pocket loss was the difference between $31,059.52, received from Magraw, and its over-all cost of $32,434.24, or about $1,374. The record then reveals the following:

“Q. (by Mr. Goodwin): All right. When you take off all of these things, when you take off our bill, which you haven’t paid; when you take off Bo-dine’s $2,000.00, which you haven’t paid; when you take off $1,100.00 for a pattern that burned up; and when you take off $230.00 for materials furnished and some other things, you actually had a profit on this, didn’t you?
“MR. LUCAS: I object to this, Your Honor, because he incurred those liabilities and he has already stated he hasn’t- paid them—
“MR. GOODWIN: It goes to the credibility of the witness that he would claim things which he is not entitled to.
“MR. LUCAS: No. The question is, the man is entitled to claim what he has incurred as an obligation. In other words, the corporation has obligated itself in certain regards. To the extent that they have, that is an element of damage. There is the question of whether they have been able to pay for it or not, but they are liable for it.
“MR. GOODWIN: Now, that is not true. They are no longer liable for them, because the corporation ceased to exist and the man is not personally liable for them.
“MR. LUCAS : He is a trustee and he is bringing this lawsuit as a trustee.
“MR. GOODWIN: He is bringing the lawsuit to pay these suppliers? They have all charged it off long years ago.
“MR. LUCAS: I don’t know whether they have charged it off or not. Apparently not.
“MR. GOODWIN: There is no lawful way they can recover against him now. The corporation ceased to exist more than a year ago and Mr. Lucas knows it.
“MR. LUCAS: Now, Your Honor, please, he can be sued and his obligation as trustee is to collect and that is on.e reason it is being brought here, so that he does get the money with which to meet his obligations. These are obligations incurred, it is not to be taken into consideration on profit and he knows that just as well as I do.
“MR. GOODWIN: All right. Well, we’ll get to his motives as to whether out of any moral compunction he is going to pay them.”

Thus during this verbal exchange, which occurred in the presence and hearing of the jury, defendant’s counsel intimated that plaintiff trustees had made a profit; declared that plaintiff trustees w;re no longer liable for the corporation’s debts more than a year before the date of trial; stated that there was no lawful way in which the creditors could recover against the plaintiff trustees because of the passage of over a year; and asserted as a fact that the creditors had charged off such debts long years ago. Of course, the matter of whether Wartenbe Filters or plaintiff trustees had made a profit on its contract with the Ma-graw Company was foreign to any issue in the case. Furthermore, counsel’s statements of the law relating to the obligations of a corporation whose charter has been forfeited, and the rights of its creditors, was incorrect. While the forfeiture of its charter effects its dissolution, such dissolution does not, as it did at common law, extinguish the corporation’s debts. Bruun v. Katz Drug Co., 351 Mo. 731, 173 S.W.2d 906; Diekroeger v. Jones, 235 Mo.App. 1117, 151 S.W.2d 691. Section 351.525 RSMo 1959, V.A.M.S., specifically provides that the directors and officers become trustees for the purpose of winding up its affairs, including the duty to “ * * * pay its debts and obligations * * The same statute further provides that the trustees may be sued, and if Section 351.565 does not establish a period of two years within which creditors may sue a corporation whose charter has been forfeited by the Secretary of State, then it would appear that the general statutes of limitation govern such actions. See Bruun v. Katz Drug Co., 359 Mo. 334, 221 S.W.2d 717. In any case, creditors are not limited to one year, as intimated by counsel. As to counsel’s assertion that all of the creditors had charged off the debts long years ago, there was not a shred of evidence in the record to justify the statement.

The foregoing colloquy was initiated, it will be recalled, when defendant asked War-tenbe whether “You actually had a profit.” Without waiting for a ruling on the objection to that question, defendant then asked Wartenbe:

“Q. (by Mr. Goodwin, continuing): Isn’t it a fact that you and your wife held notes executed by Wartenbe Filter Company in 1946, ’45, ’44, is that right?
“MR. LUCAS: Just a minute, Your Honor, that can have absolutely nothing to do — ■
“MR. GOODWIN: I want to show he milked the corporation dry and he wouldn’t pay any one of these guys if he had the money.
“MR. LUCAS: Now, I at this moment move the jury be discharged.
“THE COURT: You may disregard' that.
“MR. LUCAS: Not only that. That they be discharged at this point, because-that is done only for one purpose and: Your Honor knows it and so does counsel.
“MR. GOODWIN: I want to show his-motive.
“MR. LUCAS: That is not a proper showing and you know it.
“MR. GOODWIN: I want to show his. motive. That his motive is not to recover for the suppliers, but to recover for himself. I want to show he could! have paid his suppliers if he hasn’t foreclosed on his own machinery and' taken it away as an asset of the corporation and I am entitled, to show it,, because this man is coming in here purportedly as a trustee to recover for the creditors when, in effect, as the president and a stockholder he stood by and watched his wife foreclose and bid in his own machinery.
“MR. LUCAS: Your Honor, please. I move the jury be discharged because of prejudicial remarks of counsel. Complete misconduct on the part of counsel for the defendant.”

At that point the court admonished the jury and adjourned until the following morning. The record discloses that the next morning the following further proceedings were had in chambers:

“THE COURT: Let the record show that after a discussion in chambers after the adjournment last night and also this morning, for the record, the Court will overrule the objection and deny the motion of counsel for the plaintiff.
“MR. GOODWIN: For the purpose of the record, I offer to prove that this man caused a mortgage to be given to his wife for less than what was adequate, taking all the assets of the company, which led to its ultimate foreclosure and she bid it in, either by her as his wife or in his behalf at foreclosure. I offer to prove this, but if it is objected to I will not go into it further, but I want to protect my record.
“MR. LUCAS: I am going to object because I am going to preserve my record very carefully. I object to it and it is introduced solely for the purpose of prejudicing the jury and is not a subject of proper examination under the record in this case.
“THE COURT: I will overrule your obj ection.”

We must confess our unfamiliarity with the trial procedure by which the examining party, after an objection to his question has been overruled, is permitted to make an offer of proof in lieu of requiring the witness to answer — whether to protect his record or for any other reason. In the instant case defendant’s offer of proof came to naught, for when plaintiffs objected thereto the court again overruled their objection. But despite the fact that the court had thus twice overruled plaintiffs’ objections to defendant’s line of inquiry, and by its rulings had granted defendant permission to prove what it had stated it wanted to prove, when the trial was immediately thereafter resumed defendant did not make the slightest attempt to do so.

There can be no reasonable doubt that by the charges it made defendant seriously impugned and reflected upon the character and integrity of David Wartenbe. He was not only one of the plaintiff trustees but was also their principal witness, and plaintiffs’ entire case depended upon the acceptance of his testimony by the jury. Defendant’s grave charges could have had no other effect on the jury than to discredit Wartenbe in their eyes. And that adverse effect was undoubtedly compounded by the impression which was left with the jury. It heard defendant’s assertions as to what it proposed to prove regarding Wartenbe’s alleged nefarious actions, and heard plaintiffs’ objections. But it did not hear the court’s ruling that defendant could proceed to prove its charges, because the ruling was made in chambers, nor was it advised thereof. When, therefore, the trial was resumed and defendant failed to pursue the matter the jury could only conclude that the plaintiffs’ objection had been sustained. Thus the jury was left with the impression that defendant could have substantiated its charges had it been allowed to proceed, but had been prevented from doing so by an adverse ruling of the court.

Defendant seeks to justify its action respecting these various comments on the grounds that it was entitled to bring out the excessiveness of plaintiffs’ claim for damages, particularly items which were clearly unrelated to defendant’s breach of contract, such as the patterns destroyed by fire at another. The record shows that defendant was freely allowed to do so, but as is evident from the passages quoted, the questions propounded and the comments made did not relate to that issue. Nor, in the light of the record, can we accept the argument that the comments were retaliatory and made in the heat of the trial. It was defendant, not plaintiffs, who injected into the case the issues of creditor’s rights against the dissolved corporation and the disposal of its assets. Shortly prior to the foregoing the court had sustained plaintiffs’ objection to defendant’s question to War-tenbe : “And you know of course that since the corporation has been out of existence more than a year there isn’t any way they (the creditors) could collect on it?” Likewise, defendant had earlier asked War-tenbe: “What happened to all the jigs and dies and machinery and everything of the Wartenbe Filter Company,” to which plaintiffs objected. As heretofore stated, the question and objection precipitated a colloquy which ended with the court ruling that defendant could inquire as to whether or not the bills of creditors had been paid.

As a matter of fact, counsel returned to this issue of the rights of creditors in his closing argument:

“You and I both know where the fault lies. You and I also know this. He still owes this outfit $1132.97. Now, his corporation is no more, defunct, it is gone—
“MR. LUCAS: Now, just a moment. That has no bearing.
“MR. GOODWIN: Well, we never got our money.
“MR. LUCAS: Now, just a minute. That is not a proper argument as to whether they ever got their money if they were entitled to it. The question of being defunct has nothing to do with it.
“MR. GOODWIN: If your Honor, please, I let him have his.
“MR. LUCAS: Improper argument.
“THE COURT: He may draw inferences. Go ahead.
“MR. GOODWIN: This corporation doesn’t exist any more. This last board of directors brings a suit and they are not responsible for the debts and they can’t be made to pay for it.
“MR. LUCAS: Now, that is not—
“MR. GOODWIN: Well, that is the lav/.
“MR. LUCAS: The last board of directors can be made to pay for it if they have any assets.
“MR. GOODWIN: Well, they don’t hold any assets.
“MR. LUCAS: Well, there is no showing of that.
“THE COURT: Go ahead.
“MR. GOODWIN: We stand about as much chance of ever collecting that as Mr. Wartenbe ever did of getting his job done in aluminum.
“MR. LUCAS: I object to this argument, Your Honor.
“THE COURT: Well, he may draw inferences. Go ahead.”

What we have previously said regarding the right of creditors to sue the directors and officers as statutory trustees is equally applicable here. The statement that the plaintiff trustees “don’t hold any assets” was unsubstantiated by any evidence in the record. Of course, counsel should neither argue nor draw inferences from matters not in evidence. Faught v. Washam, Mo., 329 S.W.2d 588. And the comment of the court that defendant might draw inferences, and its action in directing the defendant to “Go ahead” without ruling on plaintiffs’ objection, was tantamount to overruling the objection and stamping the conduct of defendant’s counsel as proper. Dunn v. Terminal Railroad Association of St. Louis, Mo., 285 S.W.2d 701; Ryan v. Sheffield Car & Equipment Co., Mo.App., 24 S.W.2d 166.

This case amply illustrates the wisdom of the principle announced in Dunn v. Terminal Railroad Association of St. Louis, Mo., 285 S.W.2d 701, 708, 709, that “Lengthy colloquy between the attorneys and the trial court within the hearing of the jury is not commendable for the reason that during such colloquy comments are likely to be made which have an improper influence on the minds of the jurors. * * ” Plaintiffs vigorously contend that the foregoing comments and argument of counsel were prejudicial, and cite numerous cases in which our appellate courts have condemned as prejudicial a wide variety of remarks and arguments of counsel. Defendant with equal fervor argues that the comments or arguments adjudged to be prejudicial in those cases are not analogous to those presently under consideration; and, in addition, it leans heavily on the familiar rule that the trial court is allowed wide discretion in ruling on the propriety and prejudicial effect of conduct, comments and argument of counsel, and that its rulings will generally be deferred to on appeal unless an abuse of discretion is shown. Hancock v. Kansas City Terminal Ry. Co., 347 Mo. 166, 146 S.W.2d 627; Eickmann v. St. Louis Public Service Co., Mo., 323 S.W.2d 802; Garrison v. Ryno, Mo., 328 S.W.2d 557. “ * * * But, the doctrine of due deference to the trial court in discretionary matters is not to be self-administered by appellate courts to anesthetize against sensitivity to prejudicial error or employed by counsel to neutralize all such error * * *Faught v. Washam, Mo., 329 S.W.2d 588, 600.

In the final analysis, whether or not the particular comments or arguments are so prejudicial as to constitute reversible error depends upon the nature of the utterances and the circumstances under which they were made. Dunn v. Terminal Railroad Association of St. Louis, supra; McNeill v. Fidelity & Casualty Co. of New York, 336 Mo. 1142, 82 S.W.2d 582. When we take into account the improper and derogatory issues which were injected into the case, counsel’s mistaken statements as to the law, the unsubstantiated and prejudicial reflections upon the character and integrity of the witness, and the court’s ruling (or lack thereof) on defendant’s argument, we cannot avoid the conclusion that plaintiffs were denied that fair and impartial trial which is the inherent right of every litigant.

Our conclusion that this case must be reversed and remanded makes it unnecessary to pass upon plaintiffs’ complaint regarding Instruction No. 2. Upon a retrial defendant will have the opportunity to redraft it, if it so desires, to meet the criticism leveled at it by plaintiffs.

For the reasons stated the Commissioner recommends that the judgment be reversed and that the cause be remanded for a new trial.

PER CURIAM.

The foregoing opinion by DOERNER, C., is adopted as the opinion of the court. Accordingly, judgment is reversed and the cause remanded for a new trial.

RUDDY, Acting P. J., and FRANK W. HAYES and RAY E. WATSON, Special Judges, concur.


author: FRANK W. HAYES, Special Judge.

text:
    STATE ex rel. Samuel H. LESLIY, Jr., Relator, v. Honorable Robert L. ARONSON, Successor to Honorable O. P. Owen, Presiding Judge, Circuit Court of St. Louis, Missouri, Respondent.
    No. 31172.
    St. Louis Court of Appeals. Missouri.
    Nov. 20, 1962.

      Adolph K. Schwartz, St. Louis, for relator.
    Bruce Nangle, St. Louis, for respondent.
   FRANK W. HAYES, Special Judge.

This original proceeding is before this court on relator’s petition for writ of prohibition filed against respondent to prohibit him from exercising further jurisdiction in this cause. Prohibition is a proper remedy to prevent the judicial person or body to which it is directed from acting in a case or proceedings in which it has no jurisdiction or acting in excess of its jurisdiction. State ex rel. Miller v. Jones, Mo.App., 349 S.W.2d 534; State ex rel. City of Mansfield v. Crain, Mo.App., 301 S.W.2d 415. Upon the filing of relator’s notice, petition for the writ with exhibits and suggestions in support thereof, and notice to respondent and the filing of his suggestions in opposition thereto, and relator’s reply thereto, the relator’s petition was sustained and our preliminary writ was ordered issued prohibiting any further proceedings in the trial court until our final determination of the matter.

Relator alleges that one Robert Kaplan filed his petition for damages in the Circuit Court in the City of St. Louis, Missouri, on November 8, 1961; the clerk of said court issued a Pluries summons directed to relator; said petition and summons were served on the Secretary of State of Missouri on November 14, 1961, and by him mailed to relator, 4836 Monette, Corpus Christi, Texas, on November 14, 1961, by restricted registered United States Mail and that said petition and summons were duly received by relator; on December 7, 1961, relator filed a special appearance and motion to quash the summons and return which was overruled by Honorable O. P. Owen, then presiding in division No. 1 of said court, who was succeeded by Honorable Robert L. Aronson, Judge of Circuit Court of City of St. Louis, Missouri.

The relator further alleges that the petition of Robert Kaplan alleged that “plaintiff is a resident of the State of Missouri and defendant is resident of the City of St. Louis, State of Missouri;” there is no allegation that relator was or is a nonresident of the State of Missouri nor that Robert Kaplan is a resident of the City of St. Louis, Missouri; the Sections 506.210 and 506.220, RSMo 1959, V.A.M.S., the so-called “Long Arm Statute,” authorize service upon nonresident motorists who were either nonresidents of the State at the time of the accident or upon resident motorists who subsequently became nonresidents of Missouri and that plaintiff Kap-lan has not by allegations or proof brought relator under either category.

In his return to our Preliminary Writ of Prohibition, respondent admitted he was successor to Judge O. P. Owen; he alleges that Robert Kaplan filed his petition for damages in the Circuit Court of City of St. Louis, Missouri, on August 4, 1961; summons was issued for relator and thereafter the Sheriff made a non est return; on September 18, 1961, an alias summons was issued and on October 27, 1961, the Sheriff made a non est return; on November 7, 1961, a pluries summons was issued directed to the Secretary of State of Missouri (copies of the summons and return of the Sheriff of Cole County, Missouri, were attached to the return). He further alleged the filing of the returned registered receipt signed by one “Barbara Leslie” (this receipt was filed in this court during argument by leave of court); the filing of the motion to quash and the fact that it was overruled; the issuance of the preliminary writ of prohibition; that two non est returns were made on summonses directed to relator’s St. Louis address and that relator was “subsequently found living in Texas”' and was properly served under the “Long Arm Statute.” The return also contained citations of certain anthorities and argument in support of his position.

The return of respondent admits that plaintiff Kaplan’s petition alleged “Plaintiff is a resident of the State of Missouri and defendant is a resident of the City of St. Louis, Missouri.” There is no allegation or proof of where in the State the plaintiff resides. Respondent does not allege that relator was a nonresident at the time of the accident which is the deter-minating time. On the contrary, he alleges “defendant (relator) is a resident of the City of St. Louis, State of Missouri.” He does not allege or prove that defendant became a nonresident after the time of the accident. He alleges without proof that the Sheriff made two non est returns on summons directed to defendant’s St. Louis address. Such fact, if proven, would not be proof that defendant had become a nonresident. Proof that defendant was served by mail in Texas is not proof that defendant is a nonresident of Missouri, or a resident of Texas or that defendant was not there only temporarily. Such a fact is proof only that defendant was found in Texas. Upon the record before us, therefore, the question is, can the respondent justify service under the “Long Arm Statute” based upon the allegation by plaintiff that “defendant is a resident of the City of St. Louis, Missouri,” and on the assertion that the Sheriff made two non est returns directed to relator’s Saint Louis address and on the fact that relator was actually served by mail “while found, living in Texas” without further proof that relator was a nonresident at the time the cause of action accrued or was a resident at such time and subsequently became a nonresident ?

Sections 506.200 to 506.320, RSMo 1959, V.A.M.S., provide for service upon the defendants in actions against nonresident motorists. Under Section 506.210, by use and operation of a motor vehicle or trailer on the public highways in this State, a nonresident motorist subjects himself to the jurisdiction of the State courts and appoints the Secretary of State of Missouri as his lawful attorney and agent upon whom process may be served in suits pertaining to such actions. Section 506.220 extends the provisions of the above sections to a person who was a resident of Missouri at the time the cause of action arose but who subsequently became a nonresident of this State. Plaintiff did not allege or prove that relator was a nonresident of the State at the time the cause of action arose. On the contrary, he alleged, relator “is a resident of the City of St. Louis, State of Missouri.” He, therefore, cannot invoke the provisions of Section 506.220. Assuming plaintiff intended to invoke the provisions of Section 506.220, by alleging relator was resident of Missouri and was “found living in Texas”, he has failed to allege or prove that relator subsequently became a nonresident so as to invoke that section. Here the nonresidence of relator at the time of the service was challenged by motion to quash, and plaintiff did not prove relator had become a nonresident. A plaintiff attempting to use this method of substituted service must, upon challenge, prove a prima facie case that defendant is a nonresident. Teague v. District Court of Third Judicial District In and For Salt Lake County, State of Utah & Milton C. Brandon, 4 Utah 2d 147, 289 P.2d 331, 53 A.L.R.2d 1159; Welsh v. Ruopp, 228 Iowa 70, 289 N.W. 760; Rompza v. Lucas et al., 337 Ill.App. 106, 85 N.E.2d 467.

The fact that relator was a resident of the City of St. Louis, Missouri, and later was served by mail “while found living m Texas”, is no proof relator had subsequently become a nonresident of Missouri. For all this record shows, relator may have been out of the State temporarily for any number of reasons without ceasing to be a resident of Missouri. The statutory method of serving process on a nonresident motorist is ineffective to obtain service of process on a citizen and resident of a state while such citizen is residing temporarily outside the state or is in the armed services of the United States and stationed in another state or foreign country. Foster v. Holt et al., 237 N.C. 495, 75 S.E.2d 319; DePier v. Maddox et al., 87 Cal.App.2d 460, 197 P.2d 87; Colon et al. v. Pennsylvania Greyhound Lines, Inc. et al., 27 N.J.Super. 280, 99 A.2d 181; Berger v. Superior Court in and for Yuba County, 79 Cal.App.2d 425, 179 P.2d 600; Hughes v. Lucker, 233 Minn. 207, 46 N.W.2d 497; Carlson v. District Court of City and County of Denver et al., 116 Colo. 330, 180 P.2d 525; Warwick v. District Court of City and County of Denver et al., 129 Colo. 300, 269 P.2d 704. From the foregoing, it is obvious that respondent did not have jurisdiction over relator in the instant action.

Relator also contends that even if the plaintiff Kaplan had the right to invoke the provisions of the “Long Arm Statute” based on the record herein (which relator denies), that the service obtained is void and of no effect because plaintiff Kaplan did not comply with the terms of the Statute. To this we agree. The return receipt supplied at time of the argument shows that the petition and summons were not delivered and receipted for by the relator, “Samuel H. Leslie”, but that they were delivered to and receipted for by “Barbara Leslie.” The receipt had stamped on its face the words, “Deliver to addressee only. If refused by addressee, please indicate.”

Paragraph 2 of Section 506.240 of the Act provides that the Secretary of State shall mail “a notice of such service and a copy of such process and petition” to the defendant “by restricted, registered mail, addressed to the defendant at his last known address.” Paragraph 2 of Section 506.200 defines the term “restricted, registered mail” as meaning mail carrying the endorsement “deliver to addressee only” and requiring a return receipt or statement by the postal authorities that the addressee refused to receive and receipt for such mail. These sections were construed by the Supreme Court in Banc in the case of Parker v. Bond et al., Mo., 330 S.W.2d 121. In that case, plaintiff alleged that defendant was a resident of Leesburg, Florida, and invoked the “Long Arm Statute”; summons was issued to “Jennings Smith Bond, Box 430, Route 1, Leesburg, Florida”, and was served on the Chief Clerk to Secretary of State and the summons and return filed in the Circuit Court. A copy of the notice, with copy of summons attached, sent to defendant Bond, Box 430, Route 1, Leesburg, Florida, was filed together with affidavit of the Chief Clerk that the notice provided for in Section 506.270, had been mailed by restricted registered mail marked “Deliver to addressee only” and was returned marked “Unclaimed” by the postal authorities. On the basis of that service, default judgment was entered in favor of plaintiff who instituted garnishment proceedings against Georgia Casualty and Surety Company. Said company moved to quash the execution and garnishment on ground that the judgment was void because the Court had no jurisdiction of defendant Bond as there had been no valid service of process on him. The Supreme Court held the judgment void, saying, 1. c. 126:

“* * * We, therefore, hold the reasonable construction of these statutes (Sections 506.200-506.320) considered together is that service through the Secretary of State is good only if the required return receipt is filed either signed by the addressee or with a statement by the postal authorities that the addressee refused to receive and receipt for such mail; and that otherwise service on the defendant in another state must be obtained by the method provided in Section 506.260. In short, a plaintiff may attempt notification by registered mail at any address he desires to use; but if he cannot get a receipt signed by the defendant, or with the required statement of refusal to receive on it, then he must proceed by the personal service method to get the defendant into court. It follows that there was no valid judgment against defendant Bond; that the execution and garnishment issued thereon was properly quashed; and that Williams v. Shrout, Mo.App., 294 S.W.2d 640, relied on by garnishor, must be and is overruled.”

In the case at bar, the return receipt was not signed by the addressee but by “Barbara Leslie” and the Statute was not.complied with and the service is void. Respondent relies on Harris v. Bates, 364 Mo. 1023, 270 S.W.2d 763, and Williams v. Shrout, Mo.App., 294 S.W.2d 640. The first case is not in point because it deals with subjecting to the jurisdiction of our courts the administrator or executor of other representatives of deceased nonresident motorists served under provisions of the “Long Arm Statute” and Williams v. Shrout, supra, was expressly overruled by Parker v. Bond, supra.

Respondent requests this Court to now permit an amendment of plaintiff’s petition, presumably for the purpose of'validating the service in question. The Court cannot do this. An amendment at this stage of the proceedings without new and proper service would avail nothing. Plaintiff may amend in the Circuit Court and obtain new service under the “Long Arm Statute” and, if the service is again challenged by relator, the burden will be on the plaintiff to establish by competent proof, either that the relator was a nonresident at the time the cause of action arose or was a resident at such time and subsequently became a nonresident so as to come within the provisions of said Statute or he may adopt another method of service.

Our preliminary rule in prohibition should be and is made absolute.

It is so ordered.

RUDDY, Acting P. J., and RAY E. WATSON, Special Judge, concur.

ANDERSON, P. J., and WOLFE, J., not participating.


author:
McDowell, judge.
      RUARK, Presiding Judge

text:
    Floyd L. WEAVER and Lola Weaver, Plaintiffs-Appellants, v. Gerald V. JORDAN and Carmetta M. Jordan, Defendants-Respondents.
    No. 8110.
    Springfield Court of Appeals. Missouri.
    Nov. 5, 1962.
    Motion for Rehearing Overruled Nov. 27, 1962.

      Richart, Titus & Martin, Joplin, for appellants.
    William H. Burden, Joplin, for respondents.
   McDowell, judge.

This appeal is from a judgment in favor of the defendants on their counterclaim for $5,000 damages for violation of a restrictive covenant contained in the contract of sale of Weaver’s Restaurant by plaintiffs to defendants and in enjoining plaintiffs from engaging in the restaurant business either as owners, co-owners, employees or agents and enjoining them from leasing their real estate to anyone for restaurant purposes.

On May 1, 1959, plaintiffs and the defendants entered into a written contract for the sale and purchase of all the equipment, fixtures, stock and merchandise located in Weaver’s Restaurant at 529 Range Line in Joplin. This lease agreement is in evidence as defendants’ exhibit (I). The gross sale and purchase price was $28,000 paid; $15,000 in cash, $3,000 in Texas real estate, and $10,000 by a promissory note executed by the defendants to plaintiffs payable $300 per month and secured by chattel mortgage on the property conveyed by said contract. The real estate upon which the restaurant is located was owned by Mr. and Mrs. Smith and leased to plaintiffs. By the terms of the contract of sale plaintiffs assigned all their interest in this lease to defendants.

Defendants entered into possession of the Weaver’s Restaurant May 3, 1959, and paid the $300 monthly payments on the note sued on herein up to and including October 1, 1960, at which time they refused to make further payments for the reason that plaintiffs had violated the restrictive covenant contained in the sales contract.

On November 14, 1960, plaintiffs filed suit in the Circuit Court of Jasper County asking the court to decree foreclosure on the chattel mortgage given by defendants to secure the payment of their $10,000 promissory note and asked that the court order the property (described in said chattel mortgage) sold and the proceeds applied to the indebtedness due plaintiffs and for any deficiency if the mortgaged property did not bring sufficient funds to fully satisfy the debt and costs, and to decree the residue to be levied on other goods, chattels, lands and tenements of defendants.

Defendants filed answer and counterclaim. They admitted execution of the note and chattel mortgage and payments up to October 1, 1960.

In count I of their counterclaim they alleged, in part, that plaintiffs had violated their May 1, 1959, sales contract; that under the terms and conditions of said contract plaintiffs sold to the defendants the good will of said business and agreed with them that they would not enter into the restaurant or any competitive food business within five miles of the location of Weaver’s Restaurant for five years.

That during the year 1959, following the sale of said business, plaintiffs purchased a lot on Range Line, approximately three blocks south of Weaver’s Restaurant and erected a building thereon for the purpose of manufacturing and selling candy. This place was advertised as “Lee Weaver’s Candy Shop” in an effort to attract their former acquaintances and customers and operated this business for a few months; that during the latter part of the summer of 1960 plaintiffs remodeled said building, purchased and installed restaurant fixtures, and on or about October 13th, opened said business designating it as the “Colonel’s Pancake House”, and have since that time operated said restaurant in direct competition with the defendants’ business and in violation of the conditions of said contract; that as a direct result of the opening and operating of said restaurant business by plaintiffs they have lost all the good will that went with the Weaver’s Restaurant; that the volume of their sales has greatly decreased, making it unprofitable for them to continue in business and to compete with plaintiffs, and that as a direct result of said acts, defendants were forced out of business and to mitigate their loss and damages leased said business to Howard and Margaret McCorkle; that they have sustained damages to their business as a going concern and in addition to the damages they have sustained as a result of the decline in the volume of their business in the amount of $5,000, its market value is now worth $10,000 less than before plaintiffs entered into a competitive business with them.

Count II of the counterclaim prayed that plaintiffs be enjoined and restrained from in any manner in engaging in the business of operating a restaurant at 842 Range Line, as owners, co-owners, employees or agents and from leasing said premises to any person, firm or corporation for the purpose of conducting a cafe, restaurant or any other competitive business.

Pursuant to plaintiffs’ motion for judgment on the pleadings, the court, on June 6, 1961, gave plaintiffs an interlocutory judgment for $5,516.35. The cause was then tried only on the counterclaims of defendants, by the court without a jury.

The gravamen of the issues lies in the following paragraph of the aforementioned contract:

“It is further understood and agreed that the Sellers are selling the good will that goes with the operation of said business and agree with the Buyers that they will not enter into the restaurant or any competitive food business within five miles of the location of the Weaver’s Restaurant within a period of five years”.

The facts are undisputed that approximately three months after plaintiffs sold Weaver’s Restaurant to the defendants, plaintiffs purchased real estate located at 842 Range Line, Joplin, Missouri, for a sum of $12,000. Between August, 1959, and December 15, 1959, plaintiffs had a building erected on this property by the Parrish Construction Company at a cost of $20,000, and it is about three blocks south of Weaver’s Restaurant. Plaintiffs designed the building for a candy business and operated it as “Lee Weaver’s Candy Store”.

In the summer of 1960 plaintiffs remodeled their place of business at 842 Range Line for the purpose of putting in a pancake house and purchased all the restaurant equipment necessary for the operation of a business known as “Colonel’s Pancake House”. Thereafter, they entered into a written lease of said premises with Charles and Helen Parrish for a period of one year beginning October 17, 1960, with option to renew the lease for additional years. This lease is in evidence as plaintiffs’ exhibit (B). It was determinable by either party upon 90 days notice. The rent reserve was $500 per month plus 80% of all charges for telephone, water, gas and electrical services and plus 10% of gross receipts realized by the Parrishes in the operation of any business on the property.

Plaintiffs (landlords) agreed at their expense to:

(a) Furnish the Parrishes with telephone, water, gas and electrical utility services;
(b) To remodel the leased premises to Parrishes’ specifications at cost to plaintiffs not exceeding $3500.
(c) Furnish the Parrishes all cafe fixtures and equipment specified and required by the Parrishes.

4. Plaintiffs reserved unto themselves so much of the demised premises as they would reasonably require to make, display and sell any candies which they chose to manufacture, buy and sell.

Gerald V. Jordan testified that he had always been in the restaurant business; that at the time, and prior to the contract of lease of Weaver’s Restaurant, he owned and operated a motel located at 1001 Range Line, some three blocks south of the Weaver Restaurant; that just prior to the lease between the parties herein he was considering planning another restaurant in the vicinity of 7th and 8th Range Line; that he and the Weavers were good friends and that he had “palled around” with Mr. Weaver prior to the purchase of the Weaver’s Restaurant and that Weaver wanted to sell the business to defendants; that he realized that if he put in a new restaurant it would split Weavers’ business in half; that he considered the headaches it would take to build a place and get it set up; that another restaurant in that location would divide the business too much and, as a result of this thinking, he negotiated with the Weavers about two months before they finally entered into a contract of sale for the restaurant. He testified that he and his wife looked the place over and figured the equipment was worth $10,000 or $12,-000; that Weavers had made some improvements on the building, which he valued at from $5,000 to $8,000; that the full purchase price agreed upon was $28,000; and the difference in the value of the personal property purchased was what he paid for the established business; that Weavers had a very nice business, which, Weaver admitted, he had operated about a year and a half prior to the sale. He stated that Weavers had an understanding with the motels around the business that they would send their business to this restaurant because the Weavers furnished newspapers to all the motels.

Mrs. Jordan testified that she and her husband had been in the restaurant business since 1944 and that from her experience and knowledge she had an idea of the value of restaurant equipment; that the equipment in the Weaner’s Restaurant was worth approximately $12,000 and that the improvements which had been made on the building were worth from $8,000 to $10,000. She testified that, based on these estimates, they entered into the contract of purchase with plaintiffs (which is in evidence as defendants’ exhibit I); that the purchase price was $28,000.

The evidence is that at the time plaintiffs sold the "Weaver’s Restaurant to the defendants they were operating under a lease for the building which belonged to Bob Smith. Mrs. Jordan testified that after they entered into possession of the restaurant they obtained a new lease on the building from Mr. Smith at a monthly rental of $100; that this lease has not been assigned and defendants still pay the rent; that later they leased the equipment in the building to Mr. and Mrs. McCorkle for $150 a month plus $100 per month for the rent which they pay to Mr. Smith. She stated that at the time they took possession of the restaurant the volume of the business averaged from $8,000 to $10,000 a month; that the Weavers never advertised the business while they operated it, except to deliver papers to the motels; that the majority of the business came from tourists and motels; that there were some local customers. She said that at the time they purchased the business the closest restaurant was 71 Restaurant at 17th Street.

At the time the Colonel’s Pancake House was opened, two large signs erected on the building stated “Lee Weaver’s Candies”, and there was a display advertisement appearing in the local papers, which is in evidence as exhibits 4 and 6, announcing the opening of the Pancake House stating “formerly Lee Weaver’s Candies”. Mrs. Jordan testified that after the Pancake House opened, she noticed that the business of the Weaver’s Restaurant went down, especially the morning breakfast and lunch business; that the breakfast business was cut practically one-half; it had been running from $60 to $100 a day but dropped to around $30. She testified that Henry’s Cafe across the street from their restaurant does not serve breakfast or lunch but has a cocktail lounge and serves the evening meal. She stated she did not consent or authorize plaintiffs’ opening a competitive business.

She testified the Weavers operated a candy business exclusively until sometime in September, 1960, at which time the Parrish Construction Company remodeled the interior of said building at a cost of over $4,000 in order to convert it into a restaurant.

Mr. Weaver testified that they were required to put in an extra restroom, install a partition in the kitchen, convert the cooling room into a restroom and a part of the kitchen into a dining area; that they purchased all the fixtures, equipment, dishes and cooking equipment for the restaurant from Joe Harding about October 22, 1960, at a cost of $2,127.05. His testimony is that no one else owned any of the equipment located in said building; that he discussed with Jessie Perry of 3201 East 13th Street, in August or September, 1960, the possibility of leasing the building to her; that a rough draft lease was prepared but not executed. Jessie Perry formerly was employed at Weaver’s Restaurant while they operated it and is now employed at Colonel’s Pancake House as a waitress.

Mr. Jordan testified that in March, 1960, Weavers asked him if he would give permission to install a pancake house in place of the candy store and offered to pay him a percentage of the business; that they talked to him about three or four times; that Mrs. Weaver asked him about the matter again and he told her that he had talked it over with his wife and she said “absolutely no”. Witness said that on a prior occasion Weaver showed him newspaper clippings and magazine articles about the pancake business. He stated that on another occasion he was in Weaver’s place of business and Mrs. Weaver became angry when he refused to agree to plaintiffs’ opening the Pancake House and stated she wasn’t going to sit there and lose their candy business and do nothing about it; that some ten days later Weaver came to his place of business and apologized for his wife’s statement and said they had decided to give up the pancake business and manufacture pralines and put them in business places for sale; that this was about the last of April. Jordan testified that he permitted these pralines to be placed in his restaurant until the Pancake House opened. He testified he had another conversation with Mr. and Mrs. Weaver after they closed the candy store and were remodeling, three or four weeks before the Pancake House opened; that they asked permission to open a pancake house, and offered him a commission or percentage of the business. He stated plaintiff said, “Well, why don’t you take the whole thing over and run it yourself, because the contract — we haven’t got nobody to sign the contract yet, * * * You can still have the contract if you want it”. Witness stated that plaintiffs did not have any contract prepared but mentioned the fact that they had a contract drawn up and no one had signed it and that defendants could have it if they wanted it; that they declined the offer because of the recession at that time.

The evidence is that the Pancake House grossed from $3,000 to $4,000 a month. Mr. Jordan testified that there was a difference in the sales of the Weaver’s Restaurant after the Pancake House opened; that he noticed a change in the gross receipts, which went down. He stated they went down from $30 to $50 a day. He testified that when they bought the restaurant it had an established business; that there were certain people who came in about every day; that after the Pancake House opened he noticed a considerable change in that particular class of people that came in; that people would make inquiries there on an average of two or three a day as to where the Weavers were. He said he was certain Weavers were going to take all of his business away from him and that he was going to have to do something about it so he advertised the restaurant for sale but was unable to sell it. He testified he had to lease the same for $150 a month to Mr. and Mrs. Howard McCorkle; that they still own all of the equipment in said restaurant. The lease to the McCorkles was dated December 6, 1960, and contained an option to buy the business for $20,000. He identified exhibit 2, which shows the gross receipts of his restaurant and is as follows:

The witness stated that Henry’s Restaurant, directly across the street from Weaver’s Restaurant, is a night club with a bar, which opens at 5:00 o’clock in the evening. He stated that the best motel was across the street from Colonel’s Pancake. House and another one next door; that he got considerable breakfast business from these motels; that there were two or three other motels around 7th and Range Line which do not have their own eating facilities; that in order to induce business from these motels he furnished newspapers to five different ones; that Weaver’s Restaurant got 90% of its business out of the motels. He stated that after the Pancake House opened the business from these motels just quit coming; that this was reflected in his cash receipts. He stated he tried to sell his restaurant for $20,000 but got no offers; that there was a general decline in business along the highway; that it was the beginning of the recession that everyone knows we had; that business was going down before Colonel’s Pancake House opened but this was not the reason he wanted to sell; that the help situation was bad and he could not operate the business by himself. He testified that they kept no receipts from breakfast, lunch or dinner but read the cash register tape after every meal.

Mrs. Helen Parrish testified for plaintiffs that she and her husband had the Parrish Construction Company and the Colonel’s Pancake House; that this company did general contracting and she was its secretary; that she had regular hours from 9:00 in the morning until 5:00 in the evening; that she took care of the books. She testified this business had about IS employees and at the present time they probably had 8 or 10 building projects; that they did business in New Mexico, Texas, Arkansas, Louisiana, Oklahoma and Missouri and had done business in Kansas; that they also had an office in Dallas. She said her husband was not served with process as a witness because he was in Shreveport, Louisiana; that he was out of town quite a bit. She stated that in addition to these interests they were a part of Southwest Enterprise, Inc., a development company; that this company was building a bowling alley at 7th and Range Line and it has 10 employees at this time. She also stated they had a job at 2401 New Hampshire and one on Newman Road and in Shreveport; that she and her husband were also interested in the Bell Land Company, a development company, which owns ground in Neosho. She stated she had never worked in a cafe but worked in a drugstore in Pittsburg, Kansas, which served light lunches, when she was a girl. She testified that she married Mr. Parrish in September, 1948; that he had not been in the restaurant business at any time during their marriage until he took an interest in Colonel’s Pancake House. She stated she did not know how long they had known the Weavers, but met them first when they purchased one of their houses at Monroe, probably in 1955 or 1956; that they built the candy store for them where Colonel’s Pancake House is now located; that they did some remodeling for them at Weaver’s Restaurant; that neither she nor her husband own any equipment in the Pancake House, which has around 10 employees.

She testified Jessie Perry is employed at the Pancake House; that she thought she had been with the Weavers at Weaver’s Restaurant. She stated the Pancake House has about six waitresses; that Mr. Weaver is cashier and host and Jessie Perry is in charge in the morning when she is not there; that she was in the Pancake House about an hour and half each morning; that she takes cash and cleans off the tables if necessary, orders some produce; that the business opens at 6 :00 o’clock A.M. and she gets there around 8:00 o’clock.

She stated she keeps some of the books for the Pancake House and the remainder is done by Jim Muskrat; that she did not know how much business the Pancake House did in August as she had not asked Muskrat to make a financial statement for several months; that she does not keep the records herself. She makes out the payrolls, keeps the individual earning records, writes the checks for bills but that Muskrat reconciles the bank statements and does the actual work on the registers. She testified they have not made any percentage payments and will not do so until the end of the year; that Weavers still owe them a balance on remodeling the Pancake House; that she and her husband hire and fire employees; that she pays the Weavers their salaries, which come out of the Pancake House account; that the Weavers have no interest in the business other than employees. She stated that Jessie Perry orders and pays for the food. She testified that the Weavers have a candy case out there and a right to sell candy; that the remodeling of the cafe was done in accordance with the Parrishes’ specifications; that the Weavers make the repairs. She said Henry’s Cafe pays on a percentage basis to Southwest Enterprises; that this company operates a pool hall. She states she has three children, 4, 6, and 8 years of age.

Joe Harding testified that he furnished the equipment for the fixtures for the Colonel’s Pancake House; that part of the equipment was outdated. He said they had made some repairs which cost $40 and was charged to Weavers. He testified that from his experience in handling restaurant equipment, he thinks 10% of the gross profit is a reasonable charge for rent.

On cross examination he stated he could not tell how much rent this business could pay percentage wise of the gross income as there were too many factors involved.

Haskell Trusty, a real estate agent, testified that he operated a drive-in restaurant; that he had been in this business about twelve years; that based on his experience in buying and selling restaurants for himself and others, a business can safely pay a rental from its gross receipts on a percentage basis of 5%.

In our opinion we will designate appellants as plaintiffs and respondents as defendants, the position the parties occupied in the lower court.

In our review of this non-jury case we review the record de novo and determine the credibility, weight and value of the testimony and evidence in the case, but in doing so we give due deference to the trial court’s findings as evidenced by the result reached, and the fact that he heard the testimony and was able to observe the witnesses and thereby judge their credibility. Furthermore, we are admonished by § 510.310 RSMo 1959, V.A.M.S. that “the judgment shall not be set aside unless clearly erroneous”. Williamson v. Burnett, Mo.Sup., 345 S.W.2d 80, 81 [1, 2]; Anderson v. Abernathy, Mo.Sup., 339 S.W.2d 817, 818 [1]; State v. Anderson, Mo.Sup., 242 S.W.2d 66, 70 [1].

Plaintiffs urge error on the part of the trial court in overruling their motions for judgment and rendering judgment for $5,000 in favor of defendants and in restraining plaintiffs because:

“A restrictive covenant limiting the exercise of the pursuit of an occupation is in restraint of trade and should be strictly construed.”

To support this alleged error Prentice v. Rowe, Mo.App., 324 S.W.2d 457, is cited. This is a decision by our court. The action was for injunction for enforcement of restrictive covenants in a contract for the artificial insemination of cattle. The judgment was for plaintiffs and defendant appealed. In this case we made an exhaustive study of restrictive clauses in contracts. On page 461 we stated the rule thus:

“To be reasonable, the restraint usually must be qualified as to both time and area and must be no greater than fairly required for protection of the person for whose benefit it is imposed. Renwood Food Products v. Schaefer, 240 Mo.App. 939,, 951, 223 S.W.2d 144, 151. * * *
“ * * * A restrictive covenant limiting an individual in the exercise or pursuit of his occupation is in restraint of trade [Corbin on Contracts, Vol. 6, § 1392, loc. cit. 509; Restatement of Contracts, Vol. 2, § 513, p. 987], and the burden of “establishing its validity, by showing that it is reasonable, rests upon the party claiming its benefit.” (See authorities cited.)

The cases hold that reasonableness of the restraint was to be determined according to the facts in each case, taking into consideration the subject matter, the situation of the parties, the nature of the business restrained, and the extent of the restraint with reference to time and place. Renwood Food Products v. Schaefer, 240 Mo.App. 939, 223 S.W.2d 144, 151.

In Montgomery v. Getty, Mo.App., 284 S.W.2d 313, this court held that contracts-in restraint of trade are regarded with suspicion as the usual effect is to create monopoly, and before they will be enforced, it should clearly appear that no monopoly will be created, that enforcement will not prejudice public, that contract is reasonable as to time, space and person, not oppressive or injurious, that contract is founded on good consideration, and that its enforcement will be useful and beneficial to promisee.

Hessel v. Hill, Mo.App., 38 S.W.2d 490, involved facts similar to the facts in the instant case. There was a contract for sale of an undertaking business with a restrictive clause prohibiting sellers re-entering business within certain territory and conveyed good will and sellers’ right of competition in the territory named. On page 492 [1, 2] the court stated:

“ * * * We think it obvious that the plaintiff purchased and defendant sold not only the physical assets but the good will of the business, together with defendant’s right of competition, to the full extent of the territory named. The consideration paid, the character of the business, the situation of the parties, their manifest intention, and the express language of the covenant lead only to this conclusion. It was the evident purpose of the restrictive clause to protect the purchaser from competition in the business which he was buying. It is worthy of note that by the express terms of the contract plaintiff purchased, and defendant sold, ‘his undertaking business.’ Defendant agreed he would not re-enter said business within a stated time and area. The agreement not to re-enter the undertaking business is a covenant which forbids defendant to re-engage in or pursue the vocation of an undertaker, and is not limited to the restricted meaning of re-establishing or re-opening an office or place of business within the prescribed limits.”

We think it is obvious from the restrictive clause contained in the contract of sale in the instant case that defendants purchased and plaintiffs sold not only the physical assets but the good will of the business, together with plaintiffs’ right of competition to the full extent of the territory named. The consideration paid, the character of the business, the situation of the parties, their manifest intention, and the express language of the covenant lead only to this conclusion. It was the evident purpose of the restrictive clause to protect the purchasers from competition of the business which they were buying. It is worthy of note that by the express terms of the contract, defendants purchased, and plaintiffs sold, their restaurant business. Plaintiffs agreed that they would not enter into the restaurant or any competitive food business within five miles of the location of the Weaver’s Restaurant within a period of five years. We find that this restrictive cov-^ enant is not restricted to the meaning that plaintiffs must actually own and wholly conduct such a business but that when they, within three months after entering the sales contract with defendants, bought property on the same street, within three blocks of the business sold, erected a $20,000 building, which could be easily converted into the restaurant business and did actually, within the time limit provided in the covenant, decide to use the building for the operation of Colonel’s Pancake House; that even though they pretended to lease this property to the Parrishes, the very terms of the contract reserving a rent of $500 a month, buying and owning all of the equipment used in the restaurant, serving as employees for a stated salary and reserving 10% of the gross receipts, would justify the trial court in finding that plaintiffs were actually engaged in and operating a restaurant business in violation of the restrictive clause. This conclusion is further supported by the acts and conduct of plaintiffs prior to the opening of the Pancake House. The fact that they first consulted defendants about being released from their restrictive covenant in order to open a pancake house; that at this time they showed defendants clippings from papers and magazines showing the feasibility of going into such business and further offering defendants a part of the gross receipts to permit the opening of the Pancake House and then urging defendants to sign a lease and operate such business is strong evidence that the scheme of violating this restrictive clause by opening the Pancake House was conceived by plaintiffs long before the purported lease between plaintiffs and the Parrishes.

There is further evidence to support the finding of the trial court that plaintiffs, by opening the Pancake House breached the restrictive covenant. The Parrishes were engaged in the construction business, doing business in many states; they were friends of plaintiffs; they had remodeled the Weaver’s Restaurant before plaintiffs opened that business, they erected the building in which the Pancake House was located, they had never been interested in, or connected with, the operation of restaurants. Mrs. Parrish was the bookkeeper for the various businesses of the Parrish Construction Company. She only spent an hour and a half a day in the operation of the Pancake House. Mr. Parrish actually had nothing to do with the business. We think the trial court would have been justified in basing his opinion of liability of plaintiffs for the breach of this restrictive clause because the business was actually owned and operated by plaintiffs.

Equity is reluctant to permit a, wrong to be suffered without remedy. It seeks to do justice and is not bound by strict common law rules or the absence of precedents. It looks to the substance rather than the form and will not sanction an unconscionable result merely because it may have been brought about by means which simulate legality. And once rightfully possessed of a case it will not relinquish it short of doing complete justice. Merrick v. Stephens, Mo.App., 337 S.W.2d 713, 719 [5, 6]; Roach v. Kohn, Mo.Sup., 235 S.W.2d 284, 288.

We cannot agree with the points relied on by plaintiffs under the second alleged error. We think it could make no difference whether plaintiffs owned the property which they attempted to lease to the Parrishes, known as the Colonel’s Pancake House, at the time they sold to Weaver’s Restaurant. We do not agree with plaintiffs’ contention that the covenant did not prohibit plaintiffs from accepting employment in a competing business. In fact, we think the evidence in the instant case shows much more than merely employment by plaintiffs in the Pancake House. It shows they were actually receiving practically all the income from that business and were actually operating the same.

Under the evidence we sustain the trial court’s judgment in awarding defendants an injunction against the plaintiffs.

The most serious question presented for our decision is the judgment of $5,000 damages which plaintiffs contend was based on pure guess work and speculation. We agree with plaintiffs that the burden of proving pecuniary damages was on defendants. Pecuniary damages is not presumed. The burden of proving such damages and that they resulted from the wrongful act of plaintiffs is on defendants claiming such damages.

In 25 C.J.S. Damages § 144, p. 788, the law is stated: “ * * * a presumption of at least nominal damage follows from proof of a legal wrong. However, the amount and items of pecuniary damage are not presumed, but must be proved; and if there is no evidence as to the extent of the pecuniary loss there can be no recovery of substantial damages, at least where the elements of damage are such as to be susceptible of pecuniary admeasurement.” Newton Burial Park v. Davis, Mo.App., 78 S.W.2d 150.

The elements of damage, shown by the evidence in the instant case, consists first, that the consideration for the good will of the business sold by plaintiffs to defendants was the difference between $22,000 and $28,000. Defendants testified that this good will was completely destroyed by plaintiffs entering into the restaurant business known as Colonel’s Pancake House, just three blocks from the Weaver’s Restaurant, It will be noted that while exhibit 2, offered by defendants, showing the monthly income of the Weaver’s Restaurant during the term of operation by defendants, did show that the business declined in the latter part of said operation, it is plaintiffs’ contention that this decline in business was due to a depression. This argument does not have much weight when we compare the sales of the Weaver’s Restaurant with the gross sales of the Pancake House from the date it started operating, to-wit, October 22, 1960.

The gross sales of the Pancake House for the 7½ months of operation, as shown by plaintiffs’ answer to interrogatory No. 9, were as follows:

“10-22 to 10-30-60 $ 1,104.05
11- 1 to 11-30-60 3,200.40
12- 1 to 12-31-60 3,337.55
1- 1 to 1-30-61 3,696.15
2- 1 to 2-28-61 3,502.41
3- 1 to 3-31-61 4,389.57
4- 1 to 4-30-61 4,491.91
5- 1 to 5-31-61 4,832,29
$ 28,554.33”

Defendants offered evidence that plaintiffs, especially Mr. Weaver, had been operating the Weaver’s Restaurant for some time prior to the sale in question, (Weaver testified about a year and a half) ; that he had been in other businesses in Joplin, particularly one in which he operated a Bar for four years. Mr. Weaver admits that he had many friends in Joplin. The advertisements in the papers and the signs placed on the building connects Weaver’s name with the Pancake House attracting business that formerly went to Weaver’s Restaurant. Mrs. Jordan testified that the breakfast business was cut practically in half after the Pancake House opened; that it had been running from $60 to $100 a day and was cut to $30 a day. Mr. Jordan testified that after the Pancake House opened, he noticed a decline of from $30 to $50 a day in the gross receipts of the business. We think this testimony is supported strongly by exhibit 2 showing the monthly gross receipts of Weaver’s Restaurant during the time it was operated by defendants, before and after the opening of the Pancake House. The evidence fully supports the judgment of the trial court in finding that plaintiffs breached the restrictive covenant contained in the sale of the Weaver’s Restaurant and reduced the business of that restaurant to such an extent that defendants could not afford to operate it and thereby destroyed the good will of the business. The evidence is that they leased the restaurant after opening the Pancake House for $150 per month plus the amount of the rent.

We find that the evidence shows that plaintiffs purposely entered into a scheme to violate their restrictive clause in their contract with the defendants. The terms of their lease contract to Parrishes show that they reserved as rent $500 per month plus 10% of the gross receipts, which would amount to practically $400 per month and plus the further fact that both Mr. and Mrs. Weaver, plaintiffs, were employed in the restaurant. Mrs. Weaver operated the cash ' register and waited on tables at a salary of $35 per week and Mr. Weaver was host and cashier of the business at a salary of $40 a week which would add $75 to the $900 a month that they were receiving out of this business. Defendants’ evidence is that the profit in operating a restaurant is approximately 25% of the gross sales. Reasoning from that testimony, plaintiffs were receiving all the profits of the Pancake House. Each of the plaintiffs was working seven days a week, eight hours a day.

The evidence shows that Mrs. Parrish worked an hour and a half each day and that Mr. Parrish did nothing. In fact, the evidence shows that the Colonel’s Pancake House was owned and operated by plaintiffs; that they received practically the total income; that the lease contract from plaintiffs to Parrishes was a sham under which they undertook to get around the terms of their contract with the defendants.

We think there is sufficient proof as to the items of damage sustained by the defendants because of plaintiffs’ breach of the restrictive covenant to justify the court in rendering judgment for damages in the sum of $5,000.

Judgment affirmed.

RUARK, P. J., concurs in separate opinion.

STONE, J., concurs in result.

RUARK, Presiding Judge

(concurring).

I concur in what I think is an extremely close case on the question of damages. I have no doubt that plaintiffs did, in sneaky and indirect fashion, what they had contracted not to do. There exists the possibility that the end obviously sought by the court could have been reached by a defense to plaintiffs’ claim on the ground of partial failure of consideration; but apparently such defense was not offered and the judgment for plaintiffs is not questioned by the defendants.

In any case involving loss of business due to violation of a contract not to interfere with good will, the amount of loss or damage is, in its very nature, hard to prove with exact certainty, and must necessarily present a somewhat speculative aspect; but no more so, I think, than that in those cases which involve, for instance, damages for pain and suffering, loss of future earnings, etc. We entrust a jury with the right and duty to exercise some judgment and make determination. Surely an experienced trial judge should have the same trust in law and in equity.

The evidence does show that following the establishing of the “Colonel’s Pancake House,” the old customers of the restaurant quit coming to “Weaver’s Cafe.” Despite talk of recession and new restaurants down the road, the fact remains that, as the gross receipts of Weaver’s Cafe went down, the ■gross receipts of the competing pancake house went up in somewhat related or corresponding (but opposite) manner. And this pancake house was, in effect, being operated by Weaver and his wife who had sold their “good will” to the defendant.

The evidence showed a fairly definite value for the “good will” at the time the business was sold. In my opinion, when the wrongful competition of plaintiffs by the thinly disguised operation of a competing business so lowered the value of the business sold as to make it unprofitable to continue to operate the same, then this amounted to .a complete destruction of the good will so sold and the court would have been justified in rendering judgment for any amount within the limits of the value of such as shown by the evidence. The case was before a court of equity. I am not inclined to question too closely how such court moved to accomplish its result. Therefore, I concur.