author: HENLEY, Judge.

text:
    Lucille ENGELSMANN and Elsa Engelsmann Ferry, Plaintiffs-Appellants, v. Carl H. HOLEKAMP, Jr., as Executor Under the Last Will and Testament of Carl H. Holekamp, Sr., Defendant-Respondent.
    No. 51303.
    Supreme Court of Missouri, Division No. 1.
    May 9, 1966.

      Newell S. Ferry, Clayton, Paul Taub, Overland, for plaintiffs-appellants.
    Harry S. Kramer, Walter M. Clark, Armstrong, Teasdale, Kramer, & Vaughan, St. Louis, for defendant-respondent.
   HENLEY, Judge.

This is a suit in equity against the executor of the estate of Carl H. Holekamp, Sr., to compel an account of the administration of a certain trust. Plaintiffs pray that they may have judgment against the executor for, and the estate be surcharged with, the amounts determined by the accounting to be due them. The fundamental aver-ments of the petition are that Carl H. Hole-kamp, Sr., was in his lifetime trustee of a testamentary trust valued in May, 1919, at $49,960, of which plaintiffs are beneficiaries subject to a life estate of their mother, now deceased; that the deceased trustee commingled trust funds with his own property and otherwise violated the trust; that the mother of plaintiffs died shortly after the death of the trustee, and that the executor of the trustee’s estate has failed and refused to distribute the trust funds to plaintiffs as required by the trust instrument. The court made and entered findings of fact and conclusions of law. The decree was for defendant and plaintiffs appeal.

Plaintiffs claim that at time of trial the trust fund exceeded $90,000 and that no less than that sum is due them; hence, the amount in dispute is in excess of $15,000 and this court has jurisdiction. Article V, § 3, Constitution of Missouri, V.A.M.S; § 477.040, RSMo 1959, V.A.M.S.

The following facts are not in dispute. Herman E. Engelsmann died testate on April 22, 1918, leaving surviving him Ama-lie H. Engelsmann (his widow) and the two plaintiffs, Lucille Engelsmann and Elsa Engelsmann Ferry (his daughters). By his will and a codicil he left his 'residuary estate in trust for the benefit of his widow and daughters. Named in the will as executors, and as trustees of the trust were his brother, George Engelsmann, Amalie H. Engelsmann, and Carl H. Hole-kamp, Sr., his brother-in-law, and brother of his widow. George Engelsmann and the widow declined to serve as executors, and Carl H. Holekamp, Sr., was appointed executor and served as such until the estate was closed on May 27, 1919. The will directed that the trustees invest the funds of the trust “* * * in income bearing securities, at the highest rate of interest consistent with perfect security.” The will provided that the net annual income of the trust be paid in installments of unspecified amounts to Amalie H. Engelsmann for her life and upon her death to his daughters until they attained the age of 35 years at which time, the widow not living, the trust fund was to be distributed to the daughters. The will also provided that the trustees might encroach upon the principal, if necessary, in case of sickness or other distress of any of the beneficiaries. By the codicil the testator authorized the trustees to encroach upon the principal, if necessary, to pay his widow an income of $300 per month, but limited those payments to her for life and provided that any excess of income over that sum be paid one-half to each of his daughters upon their marriage or reaching the age of twenty-five years. Lucille Engelsmann attained age twenty-five in 1929, and Elsa Engelsmann Ferry in 1931. George Engelsmann did not serve as a trustee. Although Amalie H. Engelsmann declined in writing to serve as trustee she did, as a trustee, join with Carl H. Holekamp, Sr., in executing a receipt to the executor for $49,960. This sum represented the balance in the estate as shown by the executor’s final settlement and constituted the corpus of the trust. George H. Holekamp, Sr., died June 16, 1960, and his sister, Ama-lie H. Engelsmann, widow of Herman E. Engelsmann, died December 22, 1960. The defendant, Carl H. Holekamp, Jr., is the executor of the estate of Carl H. Hole-kamp, Sr. No part of the trust estate has been paid to plaintiffs.

Plaintiffs’ petition, with copies of the will and codicil attached, was filed March 22, 1961. It alleges substantially all of the above facts and further alleges that Carl Holekamp, Sr., as trustee, violated the trust by: (1) commingling assets of the trust estate with his own properties and funds, and (2) investing assets of the trust in properties other than income bearing securities by reason of which losses were suffered. Plaintiffs further allege: (1) that they are entitled to an accounting of the administration of the trust and distribution of its assets, their mother being deceased; (2) that no part of the assets of the trust have been distributed to them; and (3) that they have demanded distribution of said assets from defendant, executor of the estate of the deceased trustee, Carl Holekamp, Sr., but defendant has failed and refused to make distribution.

By his second amended answer defendant admits so much of the facts stated above as are pleaded in plaintiffs’ petition, and by way of affirmative defense states: (1) that Amalie Engelsmann did not decline to act as trustee, but did in fact so act; (2) that Carl Holekamp, Sr., made payments to Amalie Engelsmann at the rate of $300 per month from 1919 through 1930 and from 1931 until his death in 1960 at the rate of $150 per month for a total sum in excess of $90,000; (3) that these monthly payments, and other assets of the trust received by Amalie Engelsmann, exhausted the trust estate several years before the death of Carl Holekamp, Sr., and that payments made to Amalie after exhaustion of the trust were from his personal funds; (4) “that payments made to Amalie Engels-mann * * * throughout the years far exceed the amount contained in the trust, taking into consideration a reasonable yield to the trust from investments prudently made”; (5) that Amalie Engelsmann, as co-trustee, consented to and acquiesced in all investments of the trust fund, and consented to and acquiesced in all payments and distributions made to her; (6) that plaintiffs had the right to seek an accounting of the administration of the trust beginning in about 1925, but failed to do so and “slept on their rights” and “acquiesced in the handling of the trust * * * for a period of 35 years” during which period “ * * * records have been lost or destroyed, and both Amalie Engelsmann and Carl H. Hole-kamp, Sr., have died * * * ”, by reason of which “ * * * plaintiffs’ claims are barred by laches.”

At the beginning of the trial defendant withdrew his second amended answer and the trial proceeded on the petition and the first amended answer. This answer did not plead the defense of laches. At the close of the trial defendant requested leave to refile his second amended answer and the court took this request under advisement along with the whole case. The findings of fact and conclusions of law do not indicate a ruling on this request, but for the purposes of this opinion we will treat the pleadings as though the second amended answer had been refiled. We note this defense merely in passing for defendant’s brief is silent on the defense of laches. Defendant has abandoned this defense by failing to brief it; it is not before us; and we will not consider it in determining the issues. Stark v. Cole et al., Mo.App., 373 S.W.2d 473, 475 [1]; State ex rel. Webster Groves Sanitary Sewer District v. Smith, 337 Mo. 855, 87 S.W.2d 147, 154 [11]; City of Webster Groves, to use of Wise v. Taylor et al., 321 Mo. 955, 13 S.W.2d 646 [1].

This trial, consuming nearly nine days, produced a transcript of more than seven hundred pages and more than two hundred exhibits. We will not attempt to summarize all the evidence. A statement of the positions and general contentions of the parties with a brief account of the substance of evidence pertinent to these contentions will suffice. Plaintiffs contend that as remaindermen beneficiaries they have a right to an accounting of the administration of the trust; that Carl Holekamp, Sr., was in truth and practical effect the sole and only trustee; that said trustee having died without accounting to them, it is the duty and obligation of his personal representative to account. Plaintiffs also contend that since the executor of the trustee’s estate has failed to account, they are entitled to proceed as follows: first, to inquire into the business affairs of Carl Holekamp, Sr., individually, as executor of the estate of Herman Engelsmann, and as trustee, insofar as they pertain to and would produce an accounting of his administration of the trust; second, to show breaches of the trust by the trustee resulting in losses to the trust estate. On the theory that this inquiry would show that there are, or should be, trust assets in a certain amount remaining on the death of their mother in the hands of the executor of the estate of this deceased trustee, they contend that they are entitled to judgment against his estate for that amount and interest. Plaintiffs proved the will and codicil of Herman Engelsmann and the provisions thereof with respect to the trust, the trustees and the beneficiaries. They also proved that Carl Holekamp, Sr., administered the estate of Engelsmann as executor; that the estate was closed in 1919 and that their mother and Carl Holekamp, Sr., received from the estate as trustees $49,960 as the corpus of the trust; that Carl Holekamp, Sr., as trustee, made monthly payments to their mother in amounts corresponding to the amounts specified in the trust instrument from a trust bank account in the names of Amalie Engelsmann and Carl Holekamp, Sr., as trustees, and after that account was closed in January, 1925, from other bank accounts until his death; that their mother, the life beneficiary of the trust, is dead and that they, as remainder-men beneficiaries, have not received an accounting of the administration of the trust, nor its remaining assets they believe an accounting would show now exist.

For the reasons hereinafter stated, we are of the opinion that on these facts alone plaintiffs are entitled to a full accounting of the administration of the trust from the trustees, and, they being dead, from their personal representatives. We note that the estate of Amalie Engelsmann had not been administered at the time of this trial. In the event it is shown (as this record strongly indicates) that Carl Holekamp, Sr., was in fact the sole and exclusive trustee in charge and control of the management of the trust, then plaintiffs are entitled to an accounting from the personal representative of said deceased trustee alone.

Much of this record consists of attempts by plaintiffs to prove: (1) identity of specific items of property constituting the corpus of the trust at the time it was delivered by the executor to the trustees, and to follow or trace those individual items or their proceeds through the course of administration of the trust to reach an accounting; and (2) breaches of the trust by Carl Holekamp, Sr., as sole trustee, in (a) failing to account to all beneficiaries, (b) investing trust assets contrary to the trust instrument with resultant loss, (c) failing to keep proper records of the trust administration, and, (d) commingling trust assets with his own. The court sustained objections to practically all of this evidence. We have cast plaintiffs’ offers of proof in general terms and categories for two reasons: first, because plaintiffs do so and make no specific point of error as to a particular ruling by the court on the admissibility of evidence; second, because the result we reach obviates the need to treat it otherwise.

Defendant takes the position and contends: (1) that payments by Carl, Sr., as one of the trustees, and individually from his personal funds, to Amalie, as the lifetime beneficiary, exhausted the trust fund several years before said trustee’s death, and that monies paid Amalie by Carl, Sr., thereafter were in consideration of the brother-sister relationship from his own funds for which defendant is entitled to credit, if necessary, on any accounting; (2) that plaintiffs are not entitled to an accounting, and may not inquire into the matters on which plaintiffs offered proof for the reasons hereinafter stated. Defendant submitted evidence tending to prove: (1) that he had made diligent and extensive search of his father’s papers for records of the administration of the trust; (2) that the few he found had no continuity and consisted of partial records of a trust bank account antedating 1925, cancelled checks payable to Amalie drawn on this and other accounts, check stubs, bank ledger sheets, bank deposit receipts, and other scattered memoranda of his father, but that none showed the character of the original corpus or subsequent investments of the trust; (3) that Amalie had received from the trust and Carl, Sr., (shown by cancelled checks, stubs and other memoranda) the total sum of $93,399.89 in monthly payments; (4) that she had received from another (unknown or undisclosed) source an additional $25,575.36 between 1921 and 1938; and, (5) by bankers and others as expert witnesses, that if the trust fund of $49,960 were constantly invested “ * * * in income bearing securities, at the highest rate of interest consistent with perfect security * * *, assuming no losses to or expenses of the trust,” and assuming payments to Amalie as shown, the trust would have exhausted as early as 1943, and not later than 1954. Although defendant pleads compliance with investment requirements of the trust instrument, there is no proof that the trust fund was so invested. Nor do we understand that defendant now contends that the trust fund was so invested, except by way of the presumption he mentions : “ * * * that the trustees acted properly * *

Early in their case, plaintiffs called defendant to the witness stand and showed by him some of the payments made by his father to the deceased Mrs. Engelsmann, therefore plaintiffs’ evidence somewhat corroborates defendant’s evidence as to the dollars paid, but this is not to say conclusively that the trust fund was thereby exhausted.

Defendant insists that plaintiffs are not entitled to an accounting from him, because: (1) “they did not prove that any 'trust fund existed at the time of Amalie Engelsmann’s death”, and (2) they “did not prove the existence of any fiduciary relationship between themselves and [him].” He argues: “In order to entitle themselves to an accounting by the estate of Carl Holekamp, Sr., [plaintiffs] were required to show that a fiduciary relationship exists between them and [defendant], the executor of [Carl, Sr.’s] estate. This might have been done in one of two ways: (1) Either by showing that the trust still exists and contains assets of value; or (2) by showing that the deceased converted trust funds to his own use and that some of such funds are a part of his estate.” Continuing with this argument, he says: “It is axiomatic that an accounting will not be required unless there is proof of the existence of a fiduciary relationship”; there is no proof that a trust fund exists, “And, proof of its existence is an essential element to a claim for an accounting.” There is little precedent to follow in this jurisdiction on the particular questions involved.

It is unquestioned that a trust was created by the will of Herman Engelsmann, that Carl Holekamp, Sr., was one of the trustees of that trust, and that Amalie Engelsmann was a beneficiary thereof for her life. It may not be questioned successfully that Lucille Engelsmann and Elsa Engelsmann Ferry were remaindermen beneficiaries of that trust. It is unquestioned that the trustee or trustees were empowered to encroach upon the corpus for the purpose of paying a specified monthly income to the life beneficiary which included the power to consume the whole of the corpus for that purpose, so it may very well be that during the lifetime of Mrs. Engelsmann (which included the Great Depression as well as inflationary periods) the whole of the corpus and its increment, if any, were consumed in the support of her and her daughters. But this possible result is not known to be fact; this record does not show it; and it can never be known with certainty until a true account has been taken.

We agree with defendant that an accounting may not be required unless there is proof of the existence of a fiduciary relationship, and that the burden of proving that relationship is upon the plaintiffs. Stark v. Cole, Mo.App., 373 S.W.2d 473, 476; Edwards v. Sittner, Mo.App., 213 S.W.2d 652, 655 [1]; Garrett v. First National Bank & Trust Co., 5 Cir., 153 F.2d 289, 292 [10]; Chopelas v. Oropelas, 294 Mass. 327, 1 N.E.2d 374, 377 [2]. The existence of a trust and a fiduciary relationship between the trustee or trustees and these plaintiffs as remaindermen beneficiaries has been established. This was established by proof of the trust instrument, the beginning corpus of the trust, and one or both of the named trustees acting. The trustee or trustees stood in a fiduciary capacity first to the primary or lifetime beneficiary, the widow, Mrs. Engelsmann, and secondly to the secondary or remaindermen beneficiaries, these plaintiffs. Morrison v. Asher, Mo.App., 361 S.W.2d 844, 850 [7].

As beneficiaries, plaintiffs would be entitled to demand an accounting of the administration of the trust. Morrison v. Asher, supra, l. c. 852 [16]; Restatement, Trusts 2d, § 172, p. 376; Bogert, Trusts & Trustees (second edition), § 963, p. 18; Scott on Trusts (second edition), § 173, p. 1293; Bennett v. Weber, 323 Ill. 283, 154 N.E. 105, 110 [13]; Wood v. Honeyman, 178 Or. 484, 169 P.2d 131, 162-163, 171 A. L.R. 587 [15, 16], “Where a trust is created for several beneficiaries, each of them is entitled to information as to the trust. Where the trust is created in favor of successive beneficiaries, a beneficiary who has a future interest under the trust, as well as a beneficiary who is presently entitled to receive income, is entitled to such information, whether his interest is vested or contingent.” Scott on Trusts, (second edition), § 173, p. 1294; Restatement, Trusts 2d, § 172, p. 377, comment c; Wood v. Honeyman, supra. A trustee is under a duty to account, even though he is a life tenant with power to consume capital for his support. Griffith Estate, 84 Pa.Dist. & Co.R., 424, 428. In Griffith Estate the executor of the trustee’s estate was required to file an accounting.

“ * * * It lies within the discretion of the court * * * to order an account of the trustee or his successor in interest, at the suit of any interested party * * *. In order to succeed in such a suit for accounting, it is not necessary that the beneficiary allege that there is any sum immediately due him under the trust, or that the trustee is in default. The suit is one to obtain information concerning the course of administration, no matter what the current status of the trust should be.” Bogert, Trusts and Trustees (second edition) § 963, pp. 20-21. “ * * * Whenever a trust relation between the parties is shown to exist, the right to an accounting * * * follows as a matter of course.” Garrett v. First Nat’l Bank & Trust Co., 153 F.2d 289, 292 [10]. (CCA, 5th Circuit). “ * * * It is well settled that when a fiduciary relation is shown to exist, and property or property interests have been intrusted to an agent or trustee, the burden is thrown upon such agent intrusted to render an account, and to show that all his trust duties have been fully performed, and the manner in which they have been performed. It is assumed that the agent or trustee has means of knowing, and does know, what the principal or cestui que trust, cannot know, and is bound to reveal the entire truth * * *. It is not necessary in a case such as this that the plaintiff should show that there will be something found due to her on the accounting. That fact can never be known with certainty until the account has been taken. The right to this accounting results from the facts that the fiduciary relation has been created and assumed by the agent or trustee, and that the principal or cestui que trust is not informed, and does not know, what has been done with reference to the property or property interests confided to the agent or trustee.” Frethey v. Durant, 24 App.Div. 58, 48 N.Y.S. 839; Bogert, Trusts and Trustees, (second edition), § 962, p. 18.

The burden of accounting and what it entails is aptly expressed in Wood v. Honeyman, 178 Or. 484, 169 P.2d 131, 162 [13, 14]:

“It must be apparent that when one becomes a trustee and thus undertakes to administer an estate for the benefit of another, he must maintain records of his transactions so complete and accurate that he can show by them his faithfulness to his trust. It is not enough for him to know that he is honestly performing his duty. Since, generally, the burden of proof rests upon him to prove his fidelity, he must be able to sustain his position by honest records. Bogert on Trust and Trustees, § 962, says:

“ ‘It is the duty of the trustee to keep full, accurate, and orderly records of the status of the trust administration and of all acts thereunder. * * * “The general rule of law applicable to a trustee burdens him with the duty of showing that the account which he renders and the expenditures which he claims to have made were correct, just and necessary. * * * He is bound to keep clear and accurate accounts, and if he does not the presumptions are all against him, obscurities and doubts being resolved adversely to him.” * * * A plan should be employed which will show items of principal and their investment at the beginning of the trust, and all later additions or subtractions therefrom and changes of investment, as well as a separate set of entries to record income received and paid out. * * * For each cestui it is advantageous to have a separate record of sums due and amounts paid him by the trustee.’

“The ‘plan’ suggested by those words is so logical and simple that any trustee who means to perform his duty would embrace the plan, whether required by law to do so or not. * * * The section from which we have been quoting continues :

“ ‘The principal penalty usually stated to apply to a trustee who fails to keep proper records of his trust is that “all presumptions are against him” on his accounting, or that “all doubts on the accounting are resolved against him.” He has the burden of showing on the accounting how much principal and income he has received and from whom, how much disbursed and to whom, and what is on hand at the time.’ ”

We do not agree with defendant’s contention that for plaintiffs to be entitled to an accounting by the executor of the estate of Carl Holekamp, Sr., they are required to show that a fiduciary relationship exists between them and defendant. A fiduciary relationship between plaintiffs and Carl Holekamp, Sr., as trustee, has been established and defendant, as executor of his father’s estate, stands in the shoes of this trustee insofar as the duty and obligation to render an account is concerned. It is the personal representative only who would have the right to possess, use and control the records of his decedent which would include, in the circumstances of this case, any records of his decedent as a trustee. He is the only one who can render an account for his decedent. The death of a trustee without accounting to all beneficiaries should not, and does not, deprive them of that right, and those who have the right of control of records the trustee is required to keep have the duty and obligation to render an account of the administration of the trust. This right does not depend upon proof by the beneficiaries that a balance remains in the trust estate, for this fact cannot be determined until an accounting is rendered; nor does it depend upon proof of maladministration. For cases from other jurisdictions where the personal representative of a deceased trustee has been held to account for his decedent’s administration of a trust, see: Akin v. Warner, 318 Mass. 669, 63 N.E.2d 566; Markus v. Markus, 331 Mass. 394, 119 N.E.2d 415, 418; Alexander et al. v. Fidelity Trust Co., 249 F. 1 (CCA-3 Cir.).

Price v. Boyle, 287 Mo. 257, 229 S.W. 206, 208, cited by defendant, is a suit by the administrator of the estate of a deceased lifetime beneficiary of a trust against the executrix of the estate of the deceased trustee for an accounting. The trustee was a son of the beneficiary. The beneficiary died about four years before the trustee; the suit was filed five years after the death of the beneficiary. The trustee presented to his mother several statements of his accounts as trustee, but in the interim between her death and the institution of suit these and any other record evidence which would show whether or not he had accounted, and, if not, in what manner he had discharged his trust were destroyed by her daughter who would have been the principal beneficiary of the proceeds of the suit. Unlike the case at bar, laches was urged as a defense. This court applied that doctrine in denying an accounting. However, before reaching the point on which that decision turned, the court said that although the administrator of the deceased beneficiary’s estate (had he been appointed immediately after her death) could have demanded of the trustee that he account in all particulars, yet “ * * * in order to maintain a suit it •would have to he shown that [the trustee] had not accounted to his mother in her lifetime for all her property in his hands.” (Emphasis supplied.) The effect of the emphasized words in that case is not applicable to the facts in this case. The facts in this case are that an account has not been rendered to these beneficiaries; in Price an account apparently was rendered to the sole beneficiary entitled to an accounting. An accounting for all property of the trust to their mother, the life beneficiary, would not dispense with the obligation to render a like account to these plaintiffs, secondary or remaindermen beneficiaries. While it may be that Carl, Sr., told one or both of the plaintiffs a year or so before his death that the trust was exhausted, this does not rise to the level of an accounting.

Benz v. Powell, 338 Mo. 1032, 93 S.W.2d 877, cited by defendant, was an action to, follow or discover trust funds in the hands of the personal representative of a deceased trustee; it was not an action for an accounting, and is not applicable to the question of whether plaintiffs are entitled to an accounting.

Plaintiffs contend that Carl Hole-kamp, Sr., breached the trust by failing to keep proper records of its administration. Defendant contends there is no proof of such failure; that the mere fact that complete records were not found does not justify the conclusion they were not maintained. Although there is strong suspicion that proper records were not kept, we can-riot and do not so find from this record. We understand from defendant’s contention that records of the trust are temporarily or permanently lost. In Bogert, Trusts and Trustees, (second edition), § 962, p. IS, it is said that “If the trustee claims that he kept an account book but that he has lost it, * * * he must bear the burden of proving the payments which he alleges were shown by the book, and that doubts will be resolved against him.” Also see: Akin v. Warner, 318 Mass. 669, 63 N.E.2d 566, 570. Loss of records does not absolve a trustee or his personal representative of the obligation and duty to render a full account to trust beneficiaries and he must bear the burden of proving what he claims the lost records would show. Any doubts should be resolved against him.

In Bennett v. Weber, 323 Ill. 283, 154 N.E. 105, 110 [11] the trustee contended that it would be difficult to prove items of expense and disbursement to his mother because he had not taken receipts from her. It was held in that case that “ * * * Difficulty in making such proof does not, however, afford a reason why the rule of strict accountability by a trustee should be relaxed.” Nor would we relax that rule because of the seeming difficulty in this case. This record indicates that it is probable that an accounting can be rendered. It is inconceivable that a substantial account of the yearly financial condition of the trust (from beginning to end) should be beyond the ability of an accountant to reconstruct.

Part of the difficulty in plaintiffs’ attempt to develop or reach an accounting, after defendant had refused, lay in the trial court’s refusal to permit plaintiffs to show the identity of the items constituting the beginning corpus of the trust. The inventory and final settlement of the executor and the receipt of the trustees showed merely: $49,960. Whether that amount consisted of cash, notes, stocks, bonds, or real estate, or all, is not disclosed. The court sustained objections of defendant to this evidence on the theory that plaintiffs could not go back of the final settlement and an order discharging the executor; that the inventory and settlement “ * * * would have no probative value in showing the identity of the assets of the trust * * * ”, because they do not identify the assets represented by $49,960. But the question is not whether plaintiffs could go back of the final settlement and discharge of the executor; the question is whether plaintiffs are entitled to know the identity of items of property constituting the corpus of the trust at the time it was delivered to the trustees. An accounting necessarily requires a full disclosure and description of each item of property constituting the corpus of the trust at its inception. This record indicates it was not all cash and may have consisted also of promissory notes and real estate, or the proceeds of either or both. Defendant having refused to render an account of the trust, plaintiffs were entitled to make this inquiry and, if necessary to that purpose, to trace any known assets from the beginning of the probate estate through administration to the executor’s final settlement to determine the character of trust assets delivered to the trustees.

On the accounting to be rendered credit should be given for all sums properly paid to the life beneficiary from trust funds in accord with the terms of the trust instrument, and with all sums properly paid or advanced to her by Carl Holekamp, Sr., from his own funds in accord with the terms of the trust instrument. Bogert, Trusts and Trustees, (second edition) § 972, p. 218.

The second facet of plaintiffs’ case was their attempt to show breaches of trust by Carl Holekamp, ' Sr. Plaintiffs contend that they have shown that this trustee commingled trust funds with his own funds and property. This contention is based primarily on evidence that a trust bank account was closed early in January, 1925, that there is no record of another or subsequent trust bank account, and that after that date monthly payments made to Amalie were by checks drawn on a personal account of Carl, Sr., or on his “special” account. This record, at most, produces a suspicion of commingling, but the evidence is insufficient to establish a breach of trust by Carl, Sr. Nothing here stated is intended to reflect upon the honesty or fidelity or good faith of Amalie Engelsmann or Carl Holekamp, Sr., or his personal representative. The sum and substance of this opinion is that the interests of these beneficiaries entitle them to an accounting, and a hearing thereon should they except thereto. Whether further proceedings thereafter will be necessary cannot be ascertained until an account is rendered and determined.

Plaintiffs contend that since they proved Carl Holekamp, Sr., commingled trust funds with his own and that defendant refused to render an account they are entitled to judgment for the value of the trust together with interest. We have held that the evidence does not establish commingling. Their evidence as to the value of the trust consists of a computation that begins with $49,960 in May, 1919, to which they have added 6% interest and deducted claimed payments to Mrs. Engelsmann. They say this computation produces a balance in May, 1964, of $90,287.14, for which they are entitled to judgment. This is the same type of hypothetical computation submitted by defendants as proof of exhaustion of the trust to which plaintiffs object. This evidence has no probative effect; it is not substantial evidence on which judgment for plaintiffs could be entered.

Plaintiffs contend that the court erred in refusing to admit in evidence Exhibits GG to JJ identified by their witness, Newell Ferry (an attorney and husband of one of the plaintiffs), as being documents given him by a former attorney for defendant at a meeting held before this suit was filed. This meeting was attended by the witness, his wife, defendant and his attorney. Witness Ferry testified that the meeting was held to discuss, and that they did discuss the items constituting the trust; that defendant looked at these documents and handed them to his attorney who then gave them to witness in defendant’s presence. In his offer of proof, counsel for plaintiffs stated these exhibits would show a description of the several items constituting assets of the trust (including cash, notes, stocks and bonds) at the beginning date of the trust and on several dates thereafter. These documents were furnished the witness with defendant’s permission and approval and should have been received in evidence. The court erred in excluding them. Gibson v. Metropolitan Life Insurance Co., Mo.App., 147 S.W.2d 193, 196-197 [1-3].

The decree is reversed and the cause remanded for further proceedings in accordance with the views herein expressed.

All concur.

      . See also: Scott on Trusts (second edition), § 172, p. 1291 and reference to In Matter of Crane, Sup., 34 N.Y.S.2d 9 (1942), aff’d sub. nom., 266 App.Div. 726, 41 N.Y.S.2d 40, wherein it was held that the written acceptance of the income beneficiary of a trust of the correctness of an account did not bind the beneficiaries entitled in remainder.

      . As to what an accounting should include, see: Scott on Trusts (second edition), § 172, p. 1287; Bogert, Trusts and Trustees (second edition), § 962, pp. 10-15.


source: Caselaw Access Project

author: DAVIS, Commissioner.

license: Public Domain

text:
    KENTUCKY-WEST VIRGINIA GAS COMPANY, Appellant, v. Forrest BURCHETT et al., Appellees.
    Court of Appeals of Kentucky.
    April 29, 1966.
    C. Kilmer Combs, Boyle, Bilby, Thompson & Shoenhair, Tucson, Ariz., Paul C. Combs, Prestonsburg, for appellant.
    W. W. Burchett, Clifford B. Latta, Pres-tonsburg, for appellee.
   DAVIS, Commissioner.

The appellant gas company instituted this action against the appellees asserting that the appellees had wrongfully converted natural gas from the gas company’s line. Compensatory and punitive damages were sought. Upon trial before a jury a verdict and judgment adverse to the gas company resulted. The gas company presents two assignments of error on this appeal: (1) the trial court erred in refusing an instruction permitting an award for punitive damages, and (2) certain opinion evidence for appellees was erroneously received.

In 1928 the gas company held a gas lease upon lands of A. O. Burchett in Floyd County. One provision of the lease granted to A. O. Burchett the right to free gas from any productive well on the leasehold. The gas company drilled a producing well on the Burchett property in 1928, to which we shall refer as No. 282, as it was designated on the company’s records. Free gas from No. 282 was dispensed to the Burchett users via a one-inch pipe.

Well No. 282 was not a large well, even when first developed. However, it did afford gas to the Burchett property as well as to the gas company’s lines. The company encountered production difficulties with the well within two or three years after its opening. In 1936 the company sold the well to the Burchetts, whose successors are the appellees. The Burchetts (we shall use that terminology to refer to all of the appellees) continued to draw free gas from the one-inch pipe until 1962.

It was in 1962 that the gas company discovered a “tap-on” connection whereby the old one-inch line connected to No. 282 was connected to the gas company’s three-inch gathering line. For the gas company the evidence tended to show that the Bur-chetts had been withdrawing gas from the company’s three-inch line — not from old well No. 282 — even though the gas came to the Burchetts by way of the old one-inch pipe. It is undisputed that the old well and the three-inch line were so inter-connected that when and if the pressure of the gas in the well exceeded the line pressure in the three-inch line the flow of the gas would he from the well into the three-inch line. From this the appellees contended that in any event they had not obtained gas from the company, but rather that the company had probably received more gas from old No. 282 than they had ever gotten from the three-inch line.

For the gas company there was no direct evidence as to when the “tap-on” had been made nor by whom it was made. The physical condition of the “tap-on” — which was about five to seven feet underground, buried beneath a mound of earth and a “pretty good rock” — indicated that it had been so buried for a long time — “probably from eighteen to twenty years.” While no witness undertook to fix the exact age of the “tap-on,” it is clear from the evidence that it had existed for several years.

All of the Burchetts disclaimed any knowledge that the “tap-on” existed, except Forrest Burchett. The latter testified that in 1932, while he was serving as a temporary menial servant for the gas company, he was with a gas company crew that installed the “tap-on.” He explained that the installation had been made to prevent interruption in the free gas to the Burchetts while the gas company did some repair work on well No. 282. Forrest Burchett declared that he had supposed that the “tap-on” had been disconnected by the gas company shortly after its installation, but said that his crew had not been charged with that responsibility.

Witnesses for the gas company, qualified by training and experience in such matters, testified that No. 282 could not have remained productive of gas in any significant quantity very long after 1936. They were confident that the old well could not have supplied any gas to the Burchetts or into the three-inch line. But there was contrary evidence.

It was shown that in 1936, just a few weeks before the well was sold to the Bur-chetts the gas company had made a test of it. That test reflected that on April 13, 1936, the well indicated a volume test of 29,000 cubic feet of gas per twenty-four hours on an open flow. The same test report recites that no fluid was found in the well. This latter data is significant since the appellant’s witnesses had said that the well had been “drowned” by an excessive amount of water. Another report, under date July 11, 1934, reflected a delivery of 19,000 cubic feet of gas per day against a line pressure of 64 pounds. This report has double significance, in that it was about two years after the “water trouble” with No. 282, and in that the line pressure on the three-inch line admittedly was often below 64 pounds.

The case was submitted to the jury upon instructions authorizing quantum meruit recovery for the gas company to compensate it for such gas as the jury believed the Burchetts had received from the company’s line as opposed to gas from well No. 282. The jury returned its verdict for the Burchetts, and by its verdict found that the Burchetts had not received gas from the company’s lines. It would seem clear, therefore, that a punitive damage instruction would have made no difference, because the jury would have had to find that the Burchetts received some of the company’s gas before it could award damages, compensatory or punitive. Hence, if it was erroneous to deny the punitive damage instruction (which we do not decide), it was harmless error and may not serve as a basis for reversal. CR 61.01.

Appellant contends that at least the circumstantial evidence warrants the inference that the Burchetts damaged the gas company’s pipe by the “tap-on.” Thus, it is argued that the punitive damages instruction should have been given, since even a nominal compensatory claim will warrant an accompanying punitive damage claim, citing Louisville & N. R. Co. v. Ritchel, 148 Ky. 701, 147 S.W. 411, 41 L.R.A.,N.S., 958. As noted, the “tap-on” was of long duration; the appellees interposed a general plea of the statute of limitation. The evidence did not warrant a deduction that the “tap-on” had occurred within five years. See KRS 413.120(4) relating to trespass against real or personal property.

The appellant admits that appellee Joe Wheeler Burchett possessed the proper training and experience to qualify as an expert witness in matters relating to gas wells. In the course of his testimony the following appears:

“Q 54. Based upon your experience in the gas business and based upon the records furnished by the Kentucky West Virginia Gas Company relative to the output of the well in 1936, in your opinion were there sufficient volumes of gas in that well to provide the domestic needs of all of the defendants in this case up to and including September 28th, 1962?
BY MR. COMBS: (Counsel for Plaintiff)
We object.
BY THE COURT:
Overruled.
A. That’s right. Yes, sir. I think there was a sufficient amount of gas and I would like to have it today, dry and making 29,000. I would let them take that line up and disconnect my meter and I think me and my children would know that we could keep warm and have something to eat.
Q 55. Based upon the tie-over and cross-over that has been testified to, assuming varying pressures in the well and in the line, is it just as probable that gas has gone from your well into the line of Kentucky West Virginia Gas Company than it has that it came from their line into your well ?
A. I don’t think there is any question about it. I don’t think there is any question about it (sic) because particularly in your summer months and in the months when the consumers were not using any gas off of that well down there to speak of then that gas had no other place to go only into their line. It had to go over there in the summer months into their lines and for their delivery.
Q 56. Is there any way, Mr. Burchett, that any geologist or any gas man can determine between the year 1936 and the year 1962 when this well, if it did, began to deplete in production?
A. No, sir, I don’t think there is any way that can be determined.”

The thrust of appellant’s argument that the opinion evidence should have been rejected is that the witness did not base his opinion upon all of the records, but merely on the test of April 13, 1936. We are not impressed by this argument, because a fair reading of the testimony of Joe Wheeler Burchett discloses that he gave detailed factual bases for his opinion, and that his opinion was not rested solely on the 1936 report. It must be recalled that the reports were all reports of the appellant company. We are not able to say that the evidence would have been incompetent even had it rested solely on the 1936 report; after all, that was the report most nearly current with the time the Burchetts acquired well No. 282. We do not perceive that Foster-Milburn v. Chinn, 134 Ky. 424, 120 S.W. 364, 34 L.R.A.,N.S., 1137, or other authorities relied upon by appellant, militate against our view of the admissibility of this evidence.

The judgment is affirmed.


author: CULLEN, Commissioner.

text:
    GRAYSON VARIETY STORE, INC., Appellant, v. Ruby Ann SHAFFER, an infant, etc., et al., Appellees.
    Court of Appeals of Kentucky.
    April 29, 1966.
    Henry R. Wilhoit, Jr., Thomas D. Theo-bald, Jr., Grayson, for appellant.
    W. H. Counts, Olive Hill, for appellees.
   CULLEN, Commissioner.

Having sustained a motion for an appeal, we have before us the appeal of Grayson Variety Store, Inc., from a judgment awarding, as damages for false imprisonment, $500 each to the appellees Ruby Ann Shaffer, Valerie Jean Shaffer and Ada Lynn Shaffer. One of the contentions of the appellant is that its motions for a directed verdict and for judgment n. o. v. should have been sustained because the evidence showed there was no imprisonment or detention against will. We think the contention is well taken.

The three appellees, two of whom were age 15 and the other age 10, were shopping in appellant’s self-service variety store, in the course of which they spent a few minutes at the cosmetic counter, picking up and examining compacts. A clerk, observing them from a nearby counter, thought she saw one of the girls put a compact in a shopping bag she was carrying. Directly the girls left the store and the clerk then reported to the manager that they had taken a compact without paying for it. The manager left the store in search of the girls and he encountered them on the sidewalk a short distance from the store. He asked one of the girls what she had done with the compact she took, and she replied that she had put it back on the counter. He then said, “You better come back to the store with me, we have something to discuss,” or he said, “Would you girls come back to the store with me a minute, I have a matter to discuss with you,” or he said, “Will you girls please come back down to the store, we have a little matter to discuss.” The girls returned with him to the store, where the clerk identified them as the ones who had taken the compact. The girls then suggested that their purses and shopping bag be searched. Upon search by the clerk no compact was discovered, whereupon the manager said he was “sorry” and the girls left the store.

The girls testified that when the manager encountered them on the sidewalk he did not threaten them, touch them, speak in a loud or rough voice, or make any show of force; that they were not placed in fear, they did not feel that he was going to use any force on them, and they returned to the store with him “voluntarily.” When they were back in the store they were not detained or held by threat or by force; they merely were asked about having taken the compact and they then asked that their purses and shopping bag be searched. They testified that they desired to vindicate themselves — “we wanted them to see it wasn’t true.”

The evidence shows conclusively that the girls returned to the store voluntarily and that the search of their belongings was at their request. They were activated by a desire to vindicate themselves, not by coercion.

Our cases define an imprisonment as being any deprivation of the liberty of one person by another or detention for however short a time without such person’s consent and against his will, whether done by actual violence, threats or otherwise. Great Atlantic & Pacific Tea Co. v. Smith, 281 Ky. 583, 136 S.W.2d 759; Pratt v. Gross, 263 Ky. 521, 92 S.W.2d 788; Great Atlantic & Pacific Tea Co. v. Billups, 253 Ky. 126, 69 S.W.2d 5. The evidence in this case shows no deprivation of. liberty or detention without consent and against will.

Submission to the mere verbal direction of another, unaccompanied by force or threats of any character, does not constitute false imprisonment. 35 C.J.S. False Imprisonment § 11, p. 636. Bare words are insufficient to effect an imprisonment if the person to whom they are spoken is not deprived of freedom of action. 22 Am. Jur., False Imprisonment, Sec. 13, p. 362.

Comparable fact cases in which it was held there was no imprisonment are White v. Levy Bros. Inc., Ky., 306 S.W.2d 829; Great Atlantic & Pacific Tea Co. v. Billups, 253 Ky. 126, 69 S.W.2d 5; Sweeney v. F. W. Woolworth Co., 247 Mass. 277, 142 N.E. 50, 31 A.L.R. 311 (involving a boy accused of taking an item from a store counter); Hershey v. O’Neill, 2 Cir., 36 F. 168.

The judgment is reversed with directions to enter judgment dismissing the complaint.


author: MILLIKEN, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Leander CREASON, single, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.
    Robert Matthews, Atty. Gen., Wm. A. Lamkin, Jr., Asst. Atty. Gen., Harold K. Huddleston, Elizabethtown, for appellant.
    Morris Butler, Shuffett & Butler, Greensburg, for appellee.
   MILLIKEN, Judge.

This is an appeal in a highway condemnation case in which the Department’s valuations were reached on the basis of the highest and best use of the property as a farm (its actual current use), while the landowner’s valuations were premised on the suitability of the land for subdivision or industrial usage since the condemned property was approximately 500 feet from the city limits of Campbellsville. Both litigants appealed the county court’s award of $11,000 to the Circuit Court where a jury increased the amount allowed to $15,-005 and judgment was entered accordingly, from which the Department has appealed.

Prior to the judgment of the Taylor County Court, the appellee’s property consisted of 10.75 acres located approximately 470 feet from the city limits of Campbells-ville and approximately 500 feet from U.S. 68, to which the property’s only access was by way of a ten-foot graveled right of way. The property had previously been operated as a baby farm, and located thereon were a house, garage, woodshed and storage room, several small outbuildings, four shade trees, and several fruit trees. There were also two springs and a well providing water for the property. The portion taken for right of way consisted of 3.89 acres, which severed the remainder of the property into tracts of 2.66 acres and 4.2 acres. The smaller tract consisted of a high bluff and was left landlocked. The portion taken for right of way had located thereon the house, garage, three outbuildings, fruit trees, shade trees and well. The springs were on the small landlocked tract.

The diverse theories of the best usage of the property invoked by the litigants is reflected in their respective estimates of before-value. For the Department the highest estimate of the value of the property before the taking was $12,500, while the highest estimate of before-value for the landowner was the landowner’s own estimate, $38,362, but his expert witness was not far behind with an estimate of $33,225. There was just $2,300 difference between their maximum estimates of the value after the condemnation.

This case presents an acute example of the omnipresent conflict between efforts to indemnify the landowner for the loss of the potential value of his property for possibly more remunerative uses such as residential development or industrial development, and the necessity of measuring the condemnation value in terms of the value of the property at the time of the taking — the so-called fair market value. To hold land for accretion in value is a recognized practice just as much as investing in common stocks, but the significant thing is that investment in both is subject to the forces of the market including the effects of governmental controls. It would seem fair, therefore, in condemnation cases to value the land taken on the basis of its use at the time of the taking unless it can be shown that an expectation or probability of residential or commercial uses in the near future can be shown. Commonwealth of Kentucky, Department of Highways v. Robinette (1965), Ky., 386 S.W.2d 719; Commonwealth of Kentucky, Department of Highways v. Gearhart (1964), Ky., 383 S.W.2d 922. In the case at bar that was not shown, so the testimony as to the value of the property for residential or industrial purposes was not justified, and confused or misled the jury in reaching a verdict.

Furthermore, the specification of separate values for trees, springs, barns, etc., had no bearing on the use of the property for residential or commercial development and, consequently, had a tendency to cause the jury to duplicate or increase damages; the separate values for specific items were not elements to consider in appraising the property for residential or commercial development. The jury also found the after-value in an amount lower than the lowest estimate of any appraisal witness which was error; the verdict must be within the range of proof. Pierson v. Commonwealth of Kentucky, Department of Highways (1961), Ky., 350 S.W.2d 487; Commonwealth of Kentucky, Department of Highways v. Tyree (1963), Ky., 365 S.W.2d 472.

The judgment is reversed.


author: WADDILL, Commissioner.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Mary B. QUISENBERRY, widow, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.

      Robert Matthews, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., Frankfort, Deddo G. Lynn, Dept, of Highways, Lexington, for appellant.
    James F. Clay, James F. Clay, Jr., Dan-ville, for appellee.
   WADDILL, Commissioner.

In widening and reconstructing U. S. Highway #150 in Boyle County the Commonwealth condemned appellee’s fee interest in a strip of land comprising 1.86 acres along the highway and her reversionary interest in 2.39 acres of the existing roadway. The land taken was part of appellee’s 560-acre farm which adjoins the city of Dan-ville. The Commonwealth appeals from a judgment awarding appellee $16,080. The grounds relied on for reversal are the admission of incompetent evidence and the ex-cessiveness of the judgment.

Appellee introduced into evidence, over objection of the Commonwealth, four photographs depicting portions of her farm covered by water. These photographs were made while reconstruction of the highway was in progress. It was not satisfactorily established that the conditions shown in these photographs were a permanent result of the reconstruction. Therefore they have no relevancy in establishing the fair market value of appellee’s land and it was prejudicial error to admit them. Cf. Commonwealth, Dept. of Highways v. Staples, Ky., 388 S.W.2d 374; Commonwealth, Dept. of Highways v. Fister, Ky., 373 S.W.2d 720.

The Commonwealth further objected to the valuation testimony of the ap-pellee and moved to strike it on the ground that she did not establish sufficient qualifications to testify to the value of her property. See Commonwealth, Dept. of Highways v. Fister, supra. Appellee testified that she knew of comparable sales of land, one of which was across the road from her farm. While she apparently did not understand the exact nature of her re-versionary interest being condemned by the instant action, we believe she was shown to be sufficiently qualified to testify as a valuation witness concerning the taking of her fee interest.

We examine the record to ascertain whether the verdict is excessive. As a re-suit of this condemnation and the road construction there is a fill along a portion of appellee’s frontage on the highway. It was also necessary to remove several hundred feet of stone fence and two stone entrances.

We observe that while witnesses for appellee testified to a difference in her farm’s market value before and after the taking of as much as $30,000.00, the highest comparable sale cited was $3,500.00 per acre. Considering that the only improvements damaged by the taking were the stone fence and entranceways and that the resulting damages were not great, the probative worth of the valuation testimony offered on behalf of appellee will not reasonably support the award of $16,080.00. Commonwealth, Dept. of Highways v. Tyree, Ky., 365 S.W.2d 472.

While we take notice that the involved land is a part of a valuable farm, we cannot conscientiously uphold so large a verdict and judgment under this record.

The judgment is reversed.


text:
    COX MOTOR CAR COMPANY, Appellant, v. Roy CASTLE, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.

      J. K. Wells, Paintsville, for appellant.
    Eugene C. Rice, Paintsville, for appellee.
   CULLEN, Commissioner.

Cox Motor Car Company appeals from a judgment which awarded appellee Roy Castle $2,000 damages for breach of warranty in the sale to him of a Chevrolet truck by the appellant and which denied appellant recovery on its counterclaim for $1,728:28 alleged to be due as the unpaid balance of the purchase price of the truck.

Castle purchased the truck, new, from Cox Motor Company in December 1960. The written warranty given with the truck was in part as follows:

“Dealer warrants each new Chevrolet motor vehicle and chassis * * * sold by Dealer to be free from defects in material and workmanship under normal use and service, Dealer’s obligation under this warranty being limited to making good any part or parts thereof which shall, within ninety days after delivery of such vehicle or chassis to the original purchaser or before such vehicle or chassis has been driven 4,000 miles, whichever event shall first occur, be returned to Dealer at Dealer’s place of business and which Dealer’s examination shall disclose to its satisfaction to have been thus defective; this warranty being expressly in lieu of all other warranties, expressed or implied, * * *

Within a month Castle brought the truck back and complained of a serious vibration or shimmy. Cox’s employe told him that there was nothing that could be done, “it was just the nature of the truck.” Two more times within six months of the date of purchase Cox again brought the truck back with the same complaint, and again received the same answer.

In May 1962 the frame of the truck broke, either causing or resulting from the truck’s going into a ditch. Cox put in a new frame, which was paid for by Castle’s collision insurance carrier. The truck continued to have shimmy troubles and after an inspection by a representative of Chevrolet Division of General Motors the Division arranged to have still another new frame installed. (This took four months.) This magnified rather than ameliorated the shimmy problem, with the result that Castle finally threw in the towel and “parked” the truck. He ceased making payments on the purchase price and the truck was repossessed by G.M.A.C., which held the paper. Thereafter Castle brought the instant action seeking damages for breach of warranty. Cox counterclaimed for some $1,700 alleged to be the balance of the unpaid purchase price.

Castle claimed direct damages, as difference in market value, in the amount of $2,750. He also sought consequential damages, for loss of use, in the amount of $6,-400. The instructions authorized a finding for the plaintiff on each claim, but limited the maximum recovery for consequential damages to $2,000. The jury awarded him only $2,000, which was well within the proof of direct damages alone. The verdict as concerns the counterclaim was that “the plaintiff * * * should not be required to pay the counterclaim.”

The appellant maintains that its only liability would he under the express written warranty; that there was no proof of breach of that warranty; and that even conceding proof of breach the measure of damages would be the cost of replacing the defective parts, not the difference in market value of the truck.

Under the Uniform Commercial Code, particularly KRS 355.2-316 and 355.2-719, the parties could by contract exclude implied warranties and could limit remedies for breach of warranty. So the contract here involved validly excluded all warranties other than the one expressly stated, and it validly limited the remedy to replacement of defective parts. However, it does not follow that there was prejudicial error in the trial and decision of the instant case, in that recovery was authorized and allowed for difference in market value, and in that recovery was authorized (but we think not allowed) for loss of use.

To begin with, we think there was sufficient proof of breach of the express warranty. The evidence makes clear that from the outset there was something seriously wrong with the truck — something was defective. We do not accept the appellant’s contention that the duty was on the buyer to point out what parts were defective and to ask replacement of those specifically. It would not be reasonable to put that duty on the buyer. Furthermore, the contract clearly contemplated an “examination” by the seller. It is our opinion that the duty was on the seller, upon complaint being made of unsatisfactory operation of the truck, to make an examination designed to disclose the cause. And we think that when, as here, the seller, having been presented with a well-founded complaint of defective condition, simply gives the buyer the “brushoff”, there has been a breach of warranty.

A breach having been established, it is obvious that the contract does not contemplate that the remedy shall be by suit for specific performance of the agreement to replace the defective parts. Clearly the contract envisions damages in the form of the monetary cost of such replacement. The trouble is that in the instant case the buyer did not know and could not reasonably be expected to know what parts were causing the shimmy. The seller, who was in the best position to identify the offending parts, simply refused to recognize that there was any defect and tried to wash his hands of the whole thing. Under those circumstances we think that the whole truck properly may be considered one big defective part, and the measure of damages properly would be the cost of replacing the truck with one not defective, which would be the same as the difference in market value. The seller, not having come forward with proof that anything less than a defective condition of the entire truck was responsible for its proved unsatisfactory operation, cannot complain.

We conclude, then, that the instructions properly authorized recovery of general damages measured by difference in market value. We also conclude that the instructions improperly authorized recovery of damages for loss of use, because the contract expressly excluded any consequential damage remedy. However, it appears that the verdict did not in fact allow anything for consequential damages (since the $2,000 awarded was within the proof of difference in market value) so the error in the instructions was not prejudicial.

We come now to the matter of the denial of recovery on the appellant’s counterclaim for the unpaid balance of the purchase price. This has some peculiar aspects.

The counterclaim pleading alleged that Cox had sold the truck to Castle on a conditional sale contract and that the contract was assigned to G.M.A.C.- that thereafter several refinancing agreements were executed between Castle and G.M.A.C.; that there was a balance of $1,727.28 due under the contract as refinanced; and that Castle owed that amount to Cox. On the face of this pleading no claim in favor of Cox was stated, because the pleading alleged that Cox had assigned the contract to G.M.A.C. and all subsequent dealings were with G.M.A.C., which was not a party to the lawsuit. This defect probably was remedied by some rather casual testimony that, pursuant to an indemnifying agreement in the assignment document, Cox paid to G.M.A.C. the amount of the unpaid balance of the refinanced purchase price. This would seem to give Cox a claim against Castle by way of subrogation.

But still another obstacle stands in the way. According to the evidence the truck was repossessed. (Apparently it was repossessed by G.M.A.C. and then turned over to Cox.) However, we find nothing in the record to show that there was a sale and an insufficiency of the proceeds thereof to cover the balance due on the conditional sale contract. Certainly Cox could not keep the truck and still make a claim for the amount of the unpaid balance on the contract. Having repossessed the truck, Cox was required to liquidate it at reasonable public sale, as a condition of seeking further recovery from Castle, and Castle’s obligation became limited to whatever deficiency remained after such a sale. KRS 3SS.9-S03 to 355.9-505. General Motors Acceptance Corporation v. Dickinson, 249 Ky. 422, 60 S.W.2d 967; C. I. T. Corporation v. Thompson, 293 Ky. 637, 169 S.W.2d 820.

In the absence of evidence that there was a sale and a deficiency we think Cox did not make out a valid claim. Accordingly Cox cannot complain of the jury’s finding against the counterclaim.

The judgment is affirmed.


author: HILL, Judge.

text:
    Lillian Lyons WILLIAMS, etc., Appellants, v. Honorable Paul RATCLIFFE, County Judge, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.

      James E. Thornberry, Louisville, C. Boyd Green, Shelbyville, for appellants.
    J. F. Thomas, Thomas & Thomas, New Castle, for appellee.
   HILL, Judge.

Joe Lyons, a resident of Shelby County, died March 8, 1963. After nominating his wife, Anna Katherine Lyons, as the executrix of his will, he further provided in the will that:

“In the event that my wife, Anna Katherine Lyons, predeceases me, or is otherwise unable to act as Executrix, then I hereby nominate and appoint my following children, Prentice Lyons, Jewell Lyons, Willa D. Lyons Sharp, Clay Lyons, Lillian Lyons Williams, and Daisy Lyons Martin to be the Executors or Executrices of this my last will and testament ⅜ ⅜ ⅜ ff

The widow, Anna Katherine Lyons, qualified as executrix under the will and filed and caused to be approved a final report with the county court of Shelby County. She died testate December 1, 1964, a resident of Jefferson County, Kentucky, leaving her entire estate to appellants, Lillian Lyons Williams and Daisy Lyons Martin. Although it is unimportant to a determination of this appeal, Joe Lyons’ will contained this provision:

“I give, bequeath and devise all of my property, both real and personal, whatever kind and wherever situated to my wife, Anna Katherine Lyons, for her to have and use as she sees fit, with full power to sell, transfer and convey any or all of said property. However, at the time of her death, if there is any of my property remaining I give and devise such remainder to my eight children, Ray Lyons, Prentice Lyons, Jewell Lyons, Willa D. Lyons Sharp, Clay Lyons, Josephine Lyons Nethery, Lillian Lyons Williams and Daisy Lyons Martin, to be theirs in equal shares * *

On December 9, 1964, appellants, Lillian Lyons Williams and Daisy Lyons Martin, qualified in Jefferson County Court as executrices of the estate of Anna Katherine Lyons.

On January 26, 1965, the appellee, Honorable Paul Ratcliffe, county judge of Shelby County appointed Clay Lyons, Prentice Lyons, Willa D. Sharp, Daisy Lyons Martin, Lillian Lyons Williams and Jewell Lyons as joint “administrators de bonis non” of the estate of Joe Lyons. Appellants in their capacity as executrices of Anna Katherine Lyons’ estate filed this action in the Shelby Circuit Court seeking to enjoin appellee as such county judge from enforcing the order appointing the above named children as such “administrators.” They contend appellee was powerless to appoint an “administrator de bonis non” after the filing and approval of the final report of Anna Katherine Lyons as the first personal representative of the estate of Joe Lyons. KRS 395.060 and 395.070 are cited as authority.

The judgment appealed from denied the relief sought by appellants and upheld the order of the Shelby County Court. Appellants sue in their capacity as joint-executrices of the estate of Anna Katherine Lyons to prevent the appointment of the personal representative of the estate of Joe Lyons; as such, they have no interest in the estate of Joe Lyons and do not establish a claim for relief. If appellants had any justiciable interest at all in the matter they could have pursued it by appeal under KRS 23.030.

It is provided by KRS 395.050 that:

“If no executor is appointed by the will, or if all the executors named in the will die, refuse the executorship or fail to give bond the court may grant administration with the will annexed to the person who would have been entitled to administration if there had been no will, * * (Emphasis added)

Notwithstanding the filing and approval of a final report by Anna Katherine Lyons, we cannot question in this proceeding the power of the county judge to appoint “administrators de bonis non” for the estate of Joe Lyons. There may have been other assets of his estate not administered in the final report, or other assets may have turned up after the death of Anna Katherine Lyons. This record does not illuminate these questions.

The judgment is affirmed.


author: CLAY, Commissioner.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. S. C. TABOR, single, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.
    Robert Matthews, Atty. Gen., H. C. Smith, C. E. Skidmore, Frankfort, for appellant.
    H. Rupert Wilhoit, Wilhoit & Wilhoit, Grayson, for appellee.
   CLAY, Commissioner.

This is an appeal from a $70,000 judgment constituting a condemnation award for land taken in the town of Olive Hill for the reconstruction of U.S. Highway 60. The Commonwealth poses the single question : “Is the verdict excessive for the reason there is insufficient evidence of probative value to support it?”

The property involved is a lot near the center of town, facing 291 feet on Main Street, with a retaining wall across the front ranging from three to ten feet above street level. The ground sloped upward to a very steep hill at the rear, which gave an effective useable depth of approximately 30 feet. On this lot was a 30-year-old stone and brick residence. It contained twelve rooms, one bath, and was without central heating. The residence took up about 91 feet of the frontage. Across the street is the principal commercial area of downtown Olive Hill.

The Commonwealth acquired a 26 foot strip across the front of this property to widen Main Street, but this took the residence (which was right on the street) and left such a narrow strip between the street and the steep hill behind that for practical purposes the remaining land was of little value. (All witnesses except one estimated an after value of $500 to $2000.) The controversy rages over the before valuation fixed by the landowner and his six supposedly expert witnesses. The before values to which these witnesses testified ranged from $95,000 to $125,000.

We will not detail their testimony but will consider it from an overall standpoint. To begin with, almost all of them testified this property had a value of $300 per front foot for its entire length. This estimate was based on a commercial use of the property, which was generally agreed to be the best use. We can find no supporting reasons for such a market valuation, and other evidence introduced by the landowner demonstrates its gross extravagance.

All of the landowner’s witnesses seemed completely oblivious of the fact that this property stood at an elevation above Main Street and that its useable depth was extremely shallow. While they emphasized the commercial value of this narrow strip, none ventured to state just how it could be commercially utilized. Obviously it could accommodate only small buildings on a plateau above Main Street, with no possibility of parking areas.

If the fanciful nature of these estimates is not readily apparent from the nature and limited usability of this land, it is apparent from the comparable sales to which the witnesses alluded. One such comparable sale was a level lot across Main Street which sold in 1957 for a little over $100 per front foot. This lot had a frontage of 100 feet and a depth of 75 feet. It is simply incomprehensible to us how this apparently comparable sale of commercial property, with at least double the depth of the lot here involved, could justify a front foot valuation of three times as much.

Two other sales appear in the evidence as having some comparability. They were sales made five years after the taking and after the new highway had been constructed. The sale prices indicated a value of approximately $300 per front foot. One of these lots was a corner lot with a depth of 80 feet. The other was a lot 90 feet deep, with commercial improvements on it. Apparently these lots were at street level. On the face of it, considering the time of these sales, the nature of these properties, the elevation, the depth, and the improvements, it seems to us a matter of common knowledge that the lot here involved could not have the same value, or anything like it. Disregarding all other discrepancies, to say that a commercial lot with a depth of 30 feet is as valuable as one with a depth of 80 or 90 feet is simply incredible and contrary to reason.

It is quite edifying to examine the case of Commonwealth, Dept. of Highways v. Tyree, Ky., 365 S.W.2d 472. This involved a lot 60 feet deep, fronting 242 feet on Main Street in Olive Hill. It adjoined the property we are here considering. The differences in the two lots were: (1) the Tyree lot contained valuable commercial buildings, and (2) it had about twice the usable depth. The state condemned a strip approximately 25 feet wide. It is rather amazing to note that several of the witnesses who testified in both cases were very positive that after the taking of the Tyree strip, the remaining land, with a 242 foot frontage and a 30 foot depth, had practically no value at all We think further comment is unnecessary to illustrate the character of the valuation testimony in the present case.

Even assuming there was some basis to support the $300 per front foot appraisals on the lot here involved, we find the witnesses were not content to stand on this commercial value. They apparently considered it proper to add to it a rather stupendous separate item for the value of the residence. They added to the front foot valuation up to $50,000 for the house. We do not need to examine the question of the allegedly inflated values placed on this house, nor is it necessary to belabor the question of whether the house was, from the standpoint of commercial development, a complete white elephant with no value at all. It is sufficient to say that it is obviously doubling the damages to fix a commercial front foot valuation and add to it the full residential value of the property. It is similar to the duplications condemned in Commonwealth, Dept. of Highways v. Raybourne, Ky., 364 S.W.2d 914, and Commonwealth, Dept. of Highways v. McGeorge, Ky., 369 S.W.2d 126.

In Commonwealth, Dept, of Highways v. Tyree, Ky., 365 S.W.2d 472, we accepted appraisals which added the value of improvements to the value of the land. But these improvements were commercial buildings. Clearly commercial and residential uses of the same area are incompatible and separate valuations cannot be based upon each of the different uses at the same time and added together. See Commonwealth, Dept. of Highways v. Burden, Ky., 388 S.W.2d 577; United States v. Buhler, 5 Cir., 305 F.2d 319; Nichols on Eminent Domain, Third Edition, Volume 4, section 12.314 (page 171). Of course a small lot such as this possibly could be used for both purposes, but in that event, for valuation purposes, account must be taken of the impairment of the value of the residence by reason of the adjoining commercial use, and certainly its frontage may not be given a commercial value.

Without examining the evidence further, it is our firm conviction that the valuations given by the landowner’s witnesses were so patently extravagant, so lacking in justification, so inconsistent with comparable sales, and so infused with the allowance of double damages, as to be without probative value. See Commonwealth, Dept. of Highways v. Lyons, Ky,, 364 S.W.2d 336; and Commonwealth, Dept. of Highways v. Gearhart, Ky., 383 S.W.2d 922. While the verdict indicates the Jury markedly discounted this testimony, it was so lacking in substance that the $70,000 award was without evidentiary support.

The judgment is reversed.

      . None were engaged in the real estate business. Their respective occupations were: Funeral director, owner of a variety store, oil distributor, retail merchant, grocery and dry goods merchant, supermarket management.

      . Though some of the witnesses in that case used substantially the italicized language, the figures ranged from $2500 to $10,000.

      . We do not minimize the fact that this was a very fine house as a home for the owner, and he probably would not have voluntarily parted with it at any price, but its marketability involves an entirely different question.


author: WALLIS DOWNING, Special Commissioner.

text:
    Grant T. MULLENAX and Eleanore M. Mullenax, Appellants, v. LIGHTHOUSE REALTY CORPORATION OF PORT CHARLOTTE, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.
    B. C. Green, Green & Connor, Owens-boro, for appellants.
    Philip B. Hayden, Bugay, Cooper & Hayden, Owensboro, for appellee.
   WALLIS DOWNING, Special Commissioner.

This action was filed by appellee, a Florida corporation, in the Daviess Circuit Court, against the appellants who were residents of Daviess County, Kentucky. The action is based upon a default judgment entered against the appellants in the Circuit Court, Twelfth Judicial Circuit of Florida, on the 26th day of August, 1963. By its terms a real estate commission was awarded appellee for the sale of two unimproved lots owned by appellants.

Service of process was attempted upon appellants, who were nonresidents of the State of Florida at the time, through the Secretary of State under Florida Statutes 47.16 and 47.30, F.S.A., which statutes provide for service upon nonresidents who are engaging in business in the State of Florida.

Appellants filed a motion to dismiss the complaint, and filed certain affidavits and exhibits, and questioned the validity of the judgment sued upon, and the jurisdiction of the Florida court to enter a personal judgment. The appellants denied that they were subject to the jurisdiction of the Florida court. Appellants also filed a counterclaim with exhibits and affidavits. The procedure in the Florida court conforms to its statutory requirements which allowed the service of process on nonresidents engaged in a business in the State of Florida. The Florida judgment is enforceable unless impeached for lack of jurisdiction over the parties, or over the subject matter, or for failure to have a valid service of process, or for fraud in obtaining a judgment.

The record here shows specifically the manner in which jurisdiction was acquired. The -appellants were not engaged in any business in Florida other than investment in these lots in a section zoned commercially. There is no claim that the lots were purchased for a homestead. The Florida court held that it had jurisdiction. The appellants were engaged in a business venture in Florida, and did attempt to sell this property through the appellee, and the sale was ultimately consummated by another agent. It has been determined by the Florida courts in the cases of State ex rel. Weber, et ux. v. Register, Fla., 67 So.2d 619, and Oxley v. Zmistowski, Fla.App., 128 So.2d 186, that a person is engaged in a business venture in Florida when engaging a real estate agent and selling property not used for a homestead. The homestead distinction is made in the case of Hayes et al. v. Greenwald, Fla.App., 149 So.2d 586. The Florida service on the Kentucky defendants through the Secretary of State is a proper service under Florida law. The Kentucky courts recognize the judgment of the Florida court, and there is nothing shown in the record to set it aside in Kentucky.

Appellants contend that general issues of material fact were raised, and for this reason summary judgment should not have been granted. Our examination of the record convinces us that this contention is without merit. It is further argued that the court improperly considered certain exhibits. These exhibits did have some materiality but, in any event, the question to which they were directed was resolved by other exhibits and affidavits.

It is also contended that the court abused its discretion in refusing to allow appellánts to take the deposition of the President of the appellee corporation, who resided in Florida. The purpose of this deposition is not shown and we cannot imagine what bearing this witness’ testimony could have on the issues involved in this proceeding. We think the circuit court properly declined to permit this apparently dilatory procedural step.

A counterclaim was filed by appellants in which they sought damages against ap-pellee. It appears from the record that the circuit court did not consider this counterclaim, and by inference it was dismissed.

The Florida law (Rule l:13(a), 30 F.S.A.) and the Kentucky law (CR 13.01) contain compulsory counterclaim sections. The appellants probably could not successfully prosecute a separate suit to recover on their claim against the appellee in Florida. If they have a claim against the appellee, they must file it as a counterclaim. The appellants have elected to file their counterclaim in Kentucky.

Under our former Civil Code, on a complaint in Kentucky to enforce a foreign default judgment, a counterclaim could be filed even though it was not filed as a set-off in the foreign state. Bishop’s Administrator v. Bishop, et al., 162 Ky. 769, 173 S.W. 130. Under our Civil Rules, the same principle has been recognized where the original suit was filed in a federal court. Dixie Ohio Express Co. v. Eagle Express Co., Ky., 346 S.W.2d 30. The right to file a counterclaim in Kentucky is not barred by the failure to file the counterclaim in the Florida court.

The order of the circuit court adjudging recovery by the appellee against the appellants on the Florida judgment is proper. The circuit court should have permitted further proceedings on the counterclaim filed as an off-set.

The judgment is affirmed in part and reversed in part for proceedings consistent with this opinion.


author: WILLIAMS, Judge. PALMORE, Judge

text:
    Hubert JEWELL and William O. Isbell, Appellants, v. Mrs. Ray R. OGLESBY, Appellee.
    Court of Appeals of Kentucky.
    April 29, 1966.
    Carroll M. Redford, Redford & Redford, Glasgow, for appellants.
    Marvin M. Sotsky, Louisville, Richardson, Barrickman & Dickinson, Glasgow, for appellee.
   WILLIAMS, Judge.

This is an automobile accident case in which the appellants Hubert Jewell and William O. Isbell appeal from a judgment on a jury verdict awarding appellee Mrs. Ray R. Oglesby $10,000.

The accident happened on the morning of August 30, 1963, at a point within the city limits of Cave City, on U. S. 31-W. The day was clear and dry. Appellee was traveling south at a speed of approximately 30 to 35 miles per hour, accompanied by her brother-in-law, Willie Morton, and her daughter. Appellee attempted to pass a milk truck going in the same direction, owned by appellant Hubert Jewell, and being driven by appellant William O. Isbell. It is undisputed that appellee did not sound her horn. The stretch of road where she attempted to pass was a passing zone. The speed limit was 45 miles per hour. As ap-pellee started to pass, appellant attempted to turn left into the Whitney Woods Road (an unmarked blacktop side road). Ap-pellee’s right front bumper first made contact with the truck somewhere near the middle of the left side of appellant’s truck.

Both appellee and her passenger Willie Morton testified that they did not see a left turn blinker light. It is undisputed that no arm signal was given. Appellant Isbell testified that he gave a left turn blinker signal and the blinker light inside the cab was working. Robert J. Norris, a truck driver who was approaching from the other direction, testified that the left front blinker was working before appellant attempted to turn left. He also testified that after the accident he got in the truck, turned on the ignition and the left blinker, got out and saw that the rear blinker was working. A state trooper, James Evans, testified that he tested the turn signals about 30 minutes after the accident and after the truck had been moved off the road, and that the left front signal was working but the left rear signal was not working. The trial judge submitted the case to the jury under four different instructions.

Appellant first contends that there was no substantial evidence of negligence on his part and a directed verdict in his favor should have been given. However, there was testimony to the effect that no signal was given and also that the left rear signal was not working after the accident. Although there was positive testimony that the appellant driver gave a signal for ISO— 200 feet before attempting to turn, there was sufficient evidence of negligence on appellant’s part to create a jury issue.

Appellant’s next contention is that appellee’s failure to sound her horn constitutes negligence per se as a violation of KRS 189.340(1). However, we said in Wright v. Clausen, 263 Ky. 298, 92 S.W.2d 93 (1935), that the violation of a statutory duty does not bar the right to recovery unless the violation was the proximate cause of the injury. See also Blackburn v. Kentucky & West Virginia Power Co., Ky., 243 S.W.2d 995 (1951). In Instruction No. 2, the court established the duties of appellee and made it possible for the jury to find for the appellant if the failure of the appellee to perform any of the duties set out so contributed “to the collision that but for same such collision would not have occurred.” According to Wright v. Clausen, supra, this was the correct contributory negligence instruction and was clear and accurate.

The case was properly submitted to the jury, and their unanimous verdict must stand. The evidence of negligence was sufficient to sustain the verdict of the jury. See Hilsenrad v. Bowling, 292 Ky. 368, 166 S.W.2d 847, at 849 (1942); CR 50.01.

The judgment is affirmed.

PALMORE, J., dissenting.

PALMORE, Judge

(dissenting).

When a vehicle making a left turn is hit by an overtaking vehicle attempting to pass to its left, and it is undisputed that the driver of the overtaking vehicle did not give the horn signal required by KRS 189.-340(1), then in the absence of evidence to the contrary (for example, that the driver of the turning vehicle had observed the attempt to pass before turning) I do not see how reasonable men can avoid the conclusion that the failure to sound the horn is a proximate cause of the accident. That is the very thing the statute was designed to prevent. I would overrule cases to the contrary. I did not participate in the recent case of Lareau v. Trader, Ky., 403 S.W.2d 265 (decided December 17, 1965), but would have dissented from that opinion on the same ground. It is my firm conviction- that the horn statute is the law all the time and that under facts comparable to the evidence in this and the Lareau cases its admitted violation is a proximate cause as a matter of law. "