author: COLEMAN, Justice.

text:
    Henry YOUNG, Appellant, v. Robert E. SKIDMORE, Appellee.
    No. 14430.
    Court of Civil Appeals of Texas. Houston.
    May 28, 1964.

      Ted Musick, Houston, for appellant.
    Royston, Rayzor & Cook; Richard D. Davis, Galveston, for appellee.
   COLEMAN, Justice.

In this case this Court heretofore on April 23, 1964, orally refused appellant’s motion to direct the Clerk of this Court to file his transcript and ordered the appeal dismissed for want of jurisdiction. Appellant timely filed his motion for rehearing herein on May 6, 1964. The motion for rehearing is now overruled.

On April 1, 1964, appellant tendered his transcript to the Clerk of this Court for filing. An examination of the transcript reveals that judgment was “rendered, entered and signed this 3rd day of December, 1963.” Plaintiff’s motion for new trial was timely filed on December 13, 1963, and no amended motion for new trial was filed. The motion was heard on January 24, 1964. The trial court’s formal order overruling said motion for new trial recites: “Entered and Signed this 5th day of Feb. 1964.” The appeal bond of Henry Young was filed on February 28, 1964.

Under the provisions of Rule 329-b, Texas Rules of Civil Procedure, the motion for new trial was overruled by operation of law on January 27, 1964. The time allowed for the filing of an appeal bond began to run from that date. The trial court’s order of February 5, 1964 purporting to overrule appellant’s motion for new trial was a nullity, and did not extend the time within which the appeal bond could be filed.

Appellant did not perfect his appeal as required by Rule 356, T.R.C.P., because his appeal bond, filed February 28, 1964, was filed more than thirty days after January 27, 1964.

Motion for rehearing overruled.


source: Caselaw Access Project

author: WERLEIN, Justice.

license: Public Domain

text:
    Phil R. KENSINGER, Appellant, v. Bill McDAVID, Appellee.
    No. 14285.
    Court of Civil Appeals of Texas. Houston.
    May 28, 1964.
    Rehearing Denied June 18, 1964.

      John L. Russell, Houston, Ragan & Russell, Houston, of counsel, for appellant.
    J. Paul Pomeroy, Jr., Houston, for ap-pellee.
   WERLEIN, Justice.

This suit was brought by appellant, Phil R. Kensinger, against appellee, Bill Mc-David, to rescind the sale by appellee to appellant of 3121 shares of stock in LeBaron’s Inc. purchased by appellant on or about April 29, 1959, and to recover from appel-lee the purchase price of such stock in the sum of $3,121.00, and in the alternative to recover from appellee the difference between the purchase price of such stock and the book value thereof as of April 29, 1959. The jury having reported to the court that it could not reach a unanimous decision on all issues, an incomplete verdict was received by the court without objection by either party. Both appellant and appellee filed motions for judgment on the verdict. The court granted appellee’s motion and entered judgment that appellant take nothing.

Appellant first complains that the trial court erred both in entering judgment for appellee upon the jury’s answer to Special Issue No. 6 inquiring whether appellant and appellee waived the restrictions contained in the stock certificate of LeBaron’s, Inc. and in refusing to disregard the answer to such issue and enter judgment for appellant, because there is no evidence in support of such answer. Appellant also complains that the court erred in not granting a new trial because the jury’s answer to such issue is against the great weight and preponderance of the evidence.

In his first counter-point, appellee asserts that the restrictions regarding the sale of the stock did not apply to the sale to existing shareholders as opposed to “non-shareholders” and therefore no valid and enforceable restrictions existed which would restrict the sale by appellee to appellant of appellee’s stock, since both were stockholders in the company.

Section 2 of the By-laws of LeBaron’s, Inc. contains certain restrictions or conditions in connection with the sale of shares of stock in the company. Such restrictions are referred to on the face of the stock certificates issued and are attached to the back of the stock certificates. Section 2(b) of the restrictions reads as follows:

“No stock in the Company shall be transferred by sale, gift or otherwise, to any person, firm or corporation not a stockholder in the Company and no transfer of such stock shall be recorded on the books of the Company or shall be effective for any purpose, unless the following conditions are first met: * * =j=

Then follow the conditions and restrictions which apply to transfers of stock within the contemplation and meaning of Section 2(b). It is not necessary, in view of our holding, to set out such conditions which are quite lengthy and which were not complied with in connection with the sale of stock from appellee to appellant.

We have concluded that appellee’s counter-point One should be sustained. It is our view that Section 2(b) applies only to transfers of stock to persons and corporations not stockholders in the company. If it were intended that the conditions should apply to all persons and corporations, including holders of stock in the company, then such provision surely would not contain the words “not a stockholder in the Company.” Such words must be given some meaning. They are wholly superfluous if the restrictions are construed to apply to all' persons and corporations including stockholders. Pomilla v. Bumgardner, Tex.Civ.App.1959, 326 S.W.2d 917; Serota v. Serota, 168 Misc. 27, 5 N.Y.S.2d 68; Guaranty Laundry Co. v. Pulliam, 1947, 198 Okl. 667, 181 P.2d 1007, 2 A.L.R.2d 738; Rychwalski v. Milwaukee Candy Co., 1931, 205 Wis. 193, 236 N.W. 131; Gibbon v. 3920 Lake Shore Drive Building Corp., 310 Ill.App. 385, 34 N.E.2d 109.

Even if such restrictions did apply to a sale by a stockholder in LeBaron’s, Inc., to another stockholder therein, we are of the opinion that the jury’s finding that both appellant and appellee waived such restrictions finds support in the evidence. We have carefully read the entire statement of facts, and have concluded that we cannot say that such finding of the jury is so against the great weight and preponderance of the evidence as to be manifestly wrong and unjust. In re King’s Estate, 1951, 150 Tex. 662, 244 S.W.2d 660.

There is no merit in appellant’s contention that the court erred in entering judgment against him and refusing to order a rescission of the sale in question on the ground there was no meeting of the minds of the parties and a mutual misunderstanding and mistake as to the value of the stock. The evidence shows that appellee offered to sell his stock for $1.00 per share and the stockholders to whom it was orally offered, including appellant, paid $1.-00 per share for the stock issued to them. Appellant now contends that it was his understanding that the stockholders, including himself, had the right to buy the stock at book value as defined in Section 2(b) (1). No mention of book value was made at the time of the sale by appellee of his stock to appellant. The evidence shows that appellant did not call upon appellee for an accounting or to determine the book value of the stock he purchased until October 7, 1960, some 17j/£ months after the sale, and after appellant had called on his attorney and the stock had become worthless.

The evidence further shows that appellant had purchased other stock in the company when it was first organized, and that he was familiar with the conditions set out under Section 2(b). If there was any mistake on the part of appellant with respect to the application vel non of the conditions in question to his purchase from appellee, it was a unilateral mistake of law and not of fact, since as a matter of law the conditions do not apply to the sale in question. Admittedly neither appellant nor appellee knew the value of the stock at the time of such purchase. Furthermore, as hereinabove stated, the jury found that both appellant and appellee had waived such conditions and restrictions.

Appellant’s next two points complain of ■error on the part of the trial court in refusing to allow appellant to file his first trial amendment, and his second trial amendment, in view of the testimony admitted without objection and the issues tried by consent. Rule 67, Texas Rules of Civil Procedure, provides as follows:

“When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. In such case such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made by leave of court upon motion of any party at any time up to the submission of the case to the Court or jury, but failure so to amend shall not affect the result of the trial of these issues; provided that written pleadings, before the time of submission, shall be necessary to the submission of special issues, as is provided in Rules 277 and 279.”

Appellant, in his brief, states that the refusal of the court to admit the trial amendments to be filed “did not affect the result of the trial of these issues set forth in these pleadings (trial amendments) and plaintiff’s original petition, for the reason that the matters set out therein were undisputed as they relate to a mutual mistake of the parties as to the stock option sales purchase by appellant from appellee, and further as they relate to appellee’s own statement that he never intended to comply with the option (restrictions) agreement and did not tell anyone that he did not intend to so comply until October 7, 1960, when demand for compliance was made upon him.”

It is difficult to determine exactly the meaning of appellant’s statement, but if the refusal to grant the trial amendments did not affect the result of the trial, then appellant has failed to show that the court’s refusal to permit the filing of such trial amendments has resulted in harm.

In his motions for leave of court to file his trial amendments, appellant alleges in substance that the following issues had been raised by the evidence and tried by the consent of the parties; that an accident or mistake caused appellant to tender a sum in excess of that required under the restricted agreements pertaining to the transfer of stock in LeBaron’s, Inc.; that appellee made certain threats constituting duress; that appellee intentionally never intended to comply with the restrictive agreements in question; and that appellant should be allowed to file his pleadings to show such mistakes, and fraudulent conduct on the part of appellee, and the fact that there was no meeting of the minds of said parties. Such matters were also substantially set out in appellant’s trial amendments.

Ordinarily, where issues are tried by implied consent, the filing of trial amendments should be freely permitted. Shaw v. Tyler Bank & Trust Co., Tex.Civ.App., 1956, 285 S.W.2d 782, writ ref., n. r. e. Rule 66, T.R.C.P., directs that the court shall freely allow pleadings to be amended when the presentation of the merits of the action will be subserved thereby and the objecting party fails to show the allowance of the amendment would prejudice him. Vermillion v. Haynes, 1948, 147 Tex. 359, 215 S.W.2d 605.

In the instant case a careful reading of the statement of facts fails to disclose any evidence of fraud or duress on the part of appellee which would warrant the submission of an issue thereupon, or any evidence of probative force of accident, mistake or that there was no meeting of the minds of said parties. It is our view, therefore, that if there was any error on the part of the court in refusing to permit the filing of appellant’s trial amendments, such error was harmless, since there was no evidence of probative force that would warrant the submission of any issues with respect to any of the matters alleged in the trial amendments. Moreover, appellant has not shown that any issues were requested by him and refused by the court because there was no pleading with respect to such issues. Thus appellant has failed to show that he has suffered any harm by reason of the court’s refusal to permit the filing of his trial amendments.

Appellant complains of the court’s error in overruling his motion for a new trial on the ground of jury misconduct, asserting that at least one of the jurors answered Special Issue No. 6 against him because of such misconduct. We have read the testimony given at the hearing on misconduct, and have concluded that the trial court could reasonably have found that no misconduct occurred. Under the testimony of the jurors a fact issue was raised, which the court resolved against appellant’s contention. The court in overruling appellant’s motion for new trial and in entering judgment for appellee has impliedly found that no misconduct occurred. Since there is evidence in support of such finding, it is binding upon this Court. Younger Brothers, Inc. v. Myers, 1959, 159 Tex. 585, 324 S.W.2d 546.

Furthermore, on viewing the record as a whole, we are of the opinion that even if there was such misconduct appellant has failed to show that it probably resulted in injury to him. Barrington v. Duncan, 1943, 140 Tex. 510, 169 S.W.2d 462; Trousdale v. Texas & N. O. R. Co., 1955, 154 Tex. 231, 276 S.W.2d 242.

We fail to find that appellant objected to the court’s action in receiving a partial verdict. But even if he did, he has wholly failed to show that such action has resulted in any harm to him in view of our holding with respect to the restrictions in question and the jury’s finding that both appellant and appellee waived such restrictions. Chancey v. New Amsterdam Casualty Company, Tex.Civ.App., 336 S.W.2d 763, writ ref., n. r. e.

Judgment affirmed.


author: GRISSOM, Chief Justice.

text:
    Ray COLLINS, Appellant, v. KENT-COFFEY MANUFACTURING COMPANY, Appellee.
    No. 3888.
    Court of Civil Appeals of Texas. Eastland.
    May 22, 1964.
    Rehearing Denied June 19, 1964.
    Day & Donalson, James E. Day, Jr., Dallas, for appellant.
    Ungerman, Hill, Ungerman & Angrist, Vernon O. Teofan, Dallas, for appellee.
   GRISSOM, Chief Justice.

Kent-Coffey Manufacturing Company sued Ray Collins upon a verified account. Ray Collins filed an answer which was not verified. He denied generally plaintiff’s allegations; specifically denied that $1,406.76 of the account was lawfully chargeable to him, alleging it was the debt of a corporation, and generally claimed an offset for damage to the furniture delivered to him. Kent-Coffey Manufacturing Company filed a motion for summary judgment to the effect that its suit was upon a verified account and that Collins’ answer was insufficient to assert a defense. The court granted plaintiff’s motion and rendered judgment against Collins for the amount of the verified account. Collins has appealed.

Appellant’s points are that the court erred in holding there was no genuine issue of material fact because (1) the sales after December 23, 1962, were to be made to Ray Collins Sales Company, Inc.; (2) appellant was entitled to an offset because of damage to furniture delivered to him. He says that such defense and offset did not require verification.

Appellee’s suit was upon an open account, verified in accord with Texas Rules of Civil Procedure, rule 185. Appellant’s answer was not sworn to. Appellant’s position is that the allegations of his unverified answer raised issues of fact as to whether a portion of the account was lawfully chargeable to him and whether he was entitled to an offset to said account by reason of damage to the merchandise delivered to him. Rule 185 provides that when an action is founded upon an open account for merchandise, supported by affidavit of the plaintiff that such claim is within his knowledge just and true, that it is due, and that all just and lawful offsets, payments and credits have been allowed, the same shall be taken as prima facie evidence thereof, unless the defendant files a written denial, under oath, stating that such claim is not just or true, in whole or in part, and if in part only, stating the items and particulars which are unjust. “When the opposite party fails to file such affidavit, he shall not be permitted to deny the claim, or any item therein * * * Appellant, having failed to “file such affidavit”, as required by Rule 185, he could not deny appellee’s claim and there was no genuine issue of material fact as to whether appellant was lawfully chargeable with a portion of the account or whether he was entitled to the alleged offset. Yelton v. Bird Lime & Cement Company, Tex.Civ.App., 161 S.W.2d 353, 355, (Writ Ref.); Crenshaw v. Home Lumber Co., Tex.Civ.App., 296 S.W. 342, (Writ Dis.); Walker-Neer Machine Company v. Acmeline Manufacturing Company, Tex.Civ.App., 279 S.W.2d 156, 157, (Ref. N.R.E.) ; Burnett v. Cory Corp., Tex.Civ.App., 352 S.W.2d 502, (Ref. N.R.E.).

Appellant having failed to verify his allegations, a summary judgment for appellee was properly rendered under Texas R.C.P. 166-A. Kuper v. Schmidt, 161 Tex. 189, 338 S.W.2d 948, 951; Gulf, Colorado & Santa Fe Railway Company v. McBride, 159 Tex. 442, 322 S.W.2d 492, 500; Allen v. Western Alliance Ins. Co., 162 Tex. 572, 349 S.W.2d 590.

The judgment is affirmed.


author: MASSEY, Chief Justice.

text:
    CITY OF FORT WORTH, Appellant, v. CITIZENS HOTEL COMPANY, Appellee.
    No. 16530.
    Court of Civil Appeals of Texas. Fort Worth.
    May 22, 1964.
    Rehearing Denied June 19, 1964.

      S. G. Johndroe, Jr., City Atty., Fort Worth, for appellant.
    Brown, Herman, Scott & Young and A. M. Herman, Cantey, Hanger, Johnson, Scarborough & Gooch, and Emory Cantey, Crumley & Hooper, and Frank Crumley, Hudson, Keltner, Jordan, Smith & Cunningham, and Edgar H. Keltner, Jr., Mc-Gown, Godfrey, Logan & Decker, and B. E. Godfrey, Thompson, Walker, Smith & Shannon and Ogden, Shannon, and Stone, Parker, Snakard, Friedman & Brown and G. W. Parker, Jr., Fort Worth, for appel-lee.
   MASSEY, Chief Justice.

The material question to be determined is whether the owner of the fee interest in and under a public street (to its center), who has for many years used an underground portion thereof with knowledge and express or implied consent by the incorporated city possessing the street easement, may be subjected to liability for the payment to the city of a rental charge for its continued use.

The trial court determined that the owner, who as plaintiff sought an injunction and declaratory judgment, was not obliged to pay the rent sought to be charged and granted injunction against the municipality. We agree.

We believe that certain circumstances of the particular situation under consideration should be recognized: (1) the public street easement in which the user holds the fee, as the abutting property owner, is not held by the municipality in its private or proprietary capacity, but rather is held by it as trustee for the public for a use for public purposes; (2) the use for which the fee owner has heretofore put an underground portion, and is presently using the same, has not and does not interfere with any existing public use; (3) the charge sought to be imposed by the municipality is for rent, as a charge levied by a landlord upon a tenant, as opposed to an assessment of expense for the relocation of underground utility lines, etc., occasioned by the fee owner’s use, or to any form of taxation; (4) the municipality does not seek to appropriate the underground portion being used by the fee owner in order to devote the same to any public use nor to prepare it for such a use, but is proceeding on the premise that it is entitled to receive compensation by way of rent therefor until it should become necessary to take it into possession for public purposes; (5) the fee owner, in this court, admitted and conceded the superior right of the municipality to-reduce the premises in question to possession as and when necessary for such tO' be done for public purposes, and even prior thereto to regulate and control the same as essential for the protection of the public safety and convenience, — although denying any right of the municipality to-reduce the same to possession prior to the time such becomes a public necessity, and only then to the extent and degree essential thereto; (6) the charge sought to-be imposed was based upon the ad valorem tax value of the property, and no relation was shown between the charge and the cost to the municipality for licensing and policing the use made of the subsurface area.

All of the aforesaid was expressly found by the trial court or was necessarily implied under express findings. We are of the opinion that such found adequate support in the evidence produced before the court and was in accord with and not contrary to the weight and preponderance thereof.

The condition and circumstance of the appellee Hotel Company in this case is rather common. In the cities of this state many of the better buildings built years ago were constructed in such manner that the basement areas were used for barber shops, employee’s quarters, storage, club-rooms, etc. Oftentimes there were outside stairway openings in the sidewalk area (a part of the dedicated public street) leading’ down to the basement, particularly in the case of barber shops. Also common were openings in the sidewalk covered by grills, affording light and air circulation into the basement areas. Most of these buildings were constructed before the advent of modern air-conditioning.

These buildings were thus constructed with the full knowledge and consent of the municipalities in which they were located. The use of the basement areas, as so constructed, proceeded for many years without complaint and without any attempt made to impose a charge in the nature of rent for use of such areas lying •outside and beyond the building lines and underneath the sidewalk area. In those days the underground portion of the public streets (including the sidewalks) were not so packed with underground utility lines as in modern times. Without doubt, the continued need for more and more space for such underground facilities has come into conflict with the diminished street areas resultant because of the aforede-scribed use by the abutting property owners.

In the instant case there is evidence that the City of Fort Worth has found it necessary to re-route underground lines in the street adjacent to the hotel in question, or to re-design the manner of their installation, with an attendant increase of expense, as a direct result of the appellee’s use of the area under the sidewalk. The charge sought to be assessed against the appellee Hotel Company, however, is wholly unrelated to any increase of expense thereby occasioned.

Appellee and its predecessors in title have held and used the premises since the year 1920, when the hotel was built. It uses eight (8) or nine (9) feet of subsurface area beyond its property line, the area lying under the sidewalk which is a part of the public street. Until shortly before time of trial, such use had continued without objection on the part of the appellant City, and without any attempt on its part to assess a charge in the nature of rent because thereof.

On May 19, 1961, the City adopted its Ordinance No. 4460, amending Ordinance No. 4355 (adopted August 19, 1960), under and by authority of which ordinances it was directed that the Tax Assessor-Collector and the Director of Public Works for the City of Fort Worth should investigate and report to the City Council recommending whether the City should issue any future permit to any property owner abutting upon a public street or sidewalk to use the same as necessary or proper to the enjoyment of said abutting property owner. It was further provided that the City Council should, in the event it desired to issue such a permit, fix the terms and conditions of any such grant and the time for which it should exist, with right reserved to terminate the grant whenever in its judgment the grant might become inconsistent with the public use thereof, or when it might become a nuisance.

Operating under the purported authority of the aforesaid ordinances, the City of Fort Worth sought to impose a charge upon the Hotel Company of some $2,181.00 for the year 1962. By the time the case was tried a somewhat increased charge was sought to be imposed for the use of the same subsurface area for the year 1963. Confronted therewith, the Hotel Company sought relief by way of injunction and to secure a judicial declaration that the ordinances, Nos. 4355 and 4460, were, as to it and its use of the subsurface area for which the charge was sought to be made, wholly void and unconstitutional.

Holding for the Hotel Company, the trial court filed findings of fact and conclusions of law. As to the latter it held that the Hotel Company was the owner of the fee simple title to the middle of the streets adjacent to its property, subject only to an easement for street purposes in favor of the City of Fort Worth, as Trustee for the public; that the Hotel Company could put its retained rights in the streets to any lawful use as long as such does not interfere with the dedicated public use, regulation and control of which 1 was a right of the municipality; that the municipality has no legal authority to make a rental charge for the use of any estate in land which is owned by the Hotel Company, nor condition the use by the latter of the abutting subsurface area of the street upon the payment of a rental charge; that the municipality’s ordinances (Nos. 4355 and 4460) were adopted as revenue producing measures and were and are unrelated to any licensing or police power, do not constitute a valid tax levy, occupation or otherwise, and the money provisions thereof do not represent an exercise of any of the regulatory powers of the municipality. Further, the court held that the language of the ordinances, and their enactment under the purported authority of Vernon’s Ann.Tex.St. 1085b, “Private purposes, use of streets and sidewalks for”, preclude any assertion by the City of Fort Worth that the use to which the property in question is being put presently interferes in any way with the proper enjoyment of the streets and sidewalks for purposes to which they may be put in the interest of the public,— and, as sought to be enforced against the Hotel Company, such ordinances were void, invalid and unconstitutional.

Generally interesting are the texts to be found in 37 Am.Jur., p. 746, et seq., “Municipal Corporations”, Ch. VII, “Powers, Rights, and Functions”, B, “As to Particular Matters”, Sub. 2, “Engaging in Business Enterprises”, § 132, “Generally”,— and 38 Am.Jur., p. 168 et seq., “Municipal Corporations”, Ch. XV, “Property”, § 489, “(Alienation or Encumbrance) Lease”. They do not deal with the specific problem, however.

Although it did not seem to be truly a question in the court below, we are satisfied that when the Hotel Company proved its title to the property within its building lines, plus title emanating from a private individual in a deed where the description by metes and bounds of property thereby conveyed extended at least to the center of the abutting street or streets with which we are now concerned, and undoubtedly embracing the block and lots therein which abut upon said streets, it established by necessary legal presumption its fee ownership to the center of the streets. This was not rebutted. The trial court correctly held that such appellee was the freehold owner not only of the block and lots thereon where its building was located but of the street (to its center) itself, burdened by the easement rights of the municipality. As such an owner, the Hotel Company had an absolute property right therein without being subject to any rent. Town of Refugio v. Strauch, 1930 (Tex.Com.App.), 29 S.W.2d 1041. The discussion relative to a municipality’s rights in the ordinary type of public street is to be found in City of Mission v. Popplewell, 1956, 156 Tex. 269, 294 S.W.2d 712. It has full application to the instant case, since the streets with which we are concerned are the type in which the City of Fort Worth has an easement only.

A series of cases decided October 28, 1910 by the Supreme Court of Illinois deal with practically every phase of the dispute in the instant case. An ordinance of the City of Chicago sought to impose a charge for rent against owners of property abutting upon streets of that city for underground use thereof made or to be made in connection with a subway project. The holding of the court in each case was that the ordinance was valid when applied to owners of lots located upon streets in which the city owned the fee, but was invalid and unenforceable as against the owners of lots abutting upon streets wherein the city had an easement only. See Tacoma Safety Deposit Co. v. City of Chicago, 247 Ill. 192, 93 N.E. 153; Sears v. City of Chicago, 247 Ill. 204, 93 N.E. 158; Ryerson v. City of Chicago, 247 Ill. 285, 93 N.E. 162; Williams v. City of Chicago, 277 Ill. 240, 93 N.E. 165; Sheldon v. City of Chicago, 247 Ill. 267, 93 N.E. 166; Illinois Trust & Savings Bank v. City of Chicago, 247 Ill. 264, 93 N.E. 167; Farwell v. City of Chicago, 247 Ill. 235, 93 N.E. 168; and Northwestern Safe & Trust Co. v. City of Chicago, 247 Ill. 238, 93 N.E. 169.

In the Tacoma Safety Deposit Co. case, supra, it was stated at page 155: “We think that the law is well settled that the owner of real estate, subject only to a public or private easement, has the right to use his property for any purpose which he may deem proper, so long as the use to which it is put does not interfere with the proper enjoyment of the easement which is held by the public or by a private person therein.” It was further stated at page 157 of 93 N.E.: “To permit, however, such a structure to he erected in a street where the fee of the street rests in the abutting owner, and to require the abutting owner to pay rent for the use of such space, would be to impose an additional burden or servitude upon the fee, and would be unlawful. It is clear, therefore, to provide for the erection of a subway beneath the sidewalk and in a street adjoining the property of the abutter, where the fee in the street is in the abutter, and to require the owner of the fee to pay rent to the city for the use of his own property would be, in effect, to take from the owner his property without due process of law, or without paying him due compensation therefor, under the claim of regulating the use of the streets of the city, which would amount to an unlawful deprivation of the abutter’s property, which the law would not permit.”

Important of consideration is also the case of S. H. Kress & Co. v. City of Miami, 1919 (Florida Sup.Ct.), 78 Fla. 101, 82 So. 775, 7 A.L.R. 640, and the cases annotated beginning at 7 A.L.R. 646, “Right of abutting owner to permanent use of subsurface of street or highway”.

That appellant, City of Fort Worth, has succeeded to the rights of the state, as sovereign, in that it is a Home Rule city, is of no consequence and affords no benefit as applied to the question in this case. There could n,ever have been any right in the sovereign to exact a rental charge of the appellee Hotel Company for the use of its own property.

As applied to the Citizens Hotel Company relative to the use made and being exercised upon the subsurface areas of the streets upon which its property abuts, rights in which held by the City of Fort Worth are those of an easement only, the City’s ordinances Nos. 4355 and 4460, and V.A.T.S. Art. 1085b, as sought to be enforced against the Hotel Company, are void as an attempt to deprive it of property without due process of law, in violation of Art. 1, § 17 of the Constitution of the State of Texas, and furthermore in violation of the 14th amendment to the Constitution of the United States. The trial court correctly so held and declared and granted its writ of injunction enjoining attempted enforcement of the ordinances.

Judgment is affirmed.


author: MONTGOMERY, Judge.

text:
    Max P. WHISLER, Appellant, v. M. F. ALLEN, Ancillary Administrator of the Estate of Marko E. Whisler, Deceased, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.
    Steve Robbins, Richmond, for appellant.
    Sutton & Martin, Corbin, for appellee.
   MONTGOMERY, Judge.

The validity of the appointment by the Rockcastle County Court of M. F. Allen, a resident of Rockcastle County, as ancillary administrator of the estate of Marko E. Whisler, deceased, a resident of Ohio, is questioned.

Marko E. Whisler, a resident of Ohio, died intestate as a result of injuries sustained in an automobile accident in Rock-castle County. Appellant is his sole heir at law.

Eleven and one-half months after the death of decedent, M. F. Allen, pursuant to his application, was appointed and qualified as ancillary administrator of the estate by order of the Rockcastle County Court dated July 25, 1960. This order is valid on its face. No appeal was taken from this order. KRS 23.030; CR 72.01, 72.02.

On November 7, 1960, appellant filed a complaint in the Rockcastle County Court in which he challenged the jurisdiction of the court to appoint appellee as administrator and alleged that the order of appointment was void. The complaint was dismissed for failure to state a claim for relief. On appeal to the circuit court, the court, after hearing counsel, reached the same result and upheld the county court order.

The basis of the claim of no jurisdiction is that there is no showing that the nonresident decedent had any property in Rockcastle County. Appellant argues that his complaint did state a claim for relief since he alleged that the decedent had no estate in Rockcastle County and that no evidence was heard to contradict this allegation. Appellee answers that under CR 12.02(6) where “matters outside the pleading are presented to and not excluded by the court, the motion shall be treated as one for summary judgment and disposed of as provided in Rule 56 * *

Appellant designated for inclusion m the record on appeal “the entire and complete record of proceedings, pleadings, exhibits, motions, orders, rulings of court, opinion and order and evidence.” Significant inclusions are exhibits and evidence. Certified copies of appellee’s verified application for appointment and of the order appointing and qualifying him are included as exhibits in the record and presumably are the evidence referred to since nothing else appears in the record which might he classified as evidence.

Both the application and order of appointment recite that the decedent had “an estate consisting of personal property of the estimated value of $500.00.” The opinion and order of the circuit court refer to estate as an intangible claim for damages growing out of the negligent killing of the decedent. The court fixed the amount in controversy at $108,500. It is apparent that the court considered matters at the hearing which were outside the pleading and thus treated appellee’s motion to dismiss for failure to state a claim as a motion for summary judgment under CR 56.

The rule is stated in Clay, CR 12.02, Comment 8, as follows:

“On a motion to dismiss on this ground the Rule recognizes that matters outside the pleading attacked my be presented by affidavit or otherwise. It is within the discretion of the court whether or not this extraneous matter shall be considered, but if the court does not exclude it, the motion shall be treated as one for summary judgment under Rule 56. The purpose of this provision is to expedite the final adjudication of controversies without a trial if no real issues of fact are involved.”

Appellant does not question the rule that the county court may appoint an administrator for the estate of decedent domiciled in a foreign state at the time of his death if he left assets and debts within the jurisdiction of the court. KRS 395.030, 394.140; Payne v. Payne, 239 Ky. 99, 39 S.W.2d 205, and cases collected therein. In Jewel Tea Company v. Walker’s Adm’r, 290 Ky. 328, 161 S.W.2d 66, it was held that a claim for damages for death resulting from injuries sustained in an auto accident was sufficient estate on which to grant administration.

On the basis of the application and order before it, the circuit court was correct in holding that the decedent left an estate in Rockcastle County on which administration could he granted.

Judgment affirmed.


author: CLAY, Commissioner.

text:
    Sue STANLEY, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.

      John W. Core, Lexington, M. C. Red-wine, Jr., Winchester, for appellant.
    Robert Matthews, Atty. Gen., Ray Corns, Asst. Atty. Gen., Frankfort, for appellee.
   CLAY, Commissioner.

Appellant was convicted of murder and .•given a life sentence. Her principal contention on this appeal is that the court erred in failing to give an instruction on voluntary manslaughter.

One evening appellant and a friend she had been dating, Wade Taylor, were occupying a room in a motel. She had been drinking beer and he had been drinking whiskey. With her own pistol she shot Taylor six times, causing his death.

The only eyewitness to the incident was appellant, who testified at the trial. She stated that while she was seated on the bed, Taylor was attempting to fix the television. On top of it was a loaded pistol which had been placed there by him. It was owned by appellant but she had loaned it to him sometime before. Appellant picked up the firearm to look at it, whereupon Taylor “grabbed” her. The gun went off.

Appellant testified she had no intention of shooting Taylor, there was no reason for him to grab her, and there had been no quarrel.

The court instructed the jury on murder and accidental shooting. The question is whether an additional instruction on voluntary manslaughter should have been given.

It is the well recognized rule in this state that if there is any evidence from which a reasonable inference may be drawn that the defendant in a homicide case is guilty of a lesser crime than murder, instructions should be given consistent therewith. Wagers v. Commonwealth, Ky., 256 S.W.2d 357; Lee v. Commonwealth, Ky., 329 S.W.2d 57.

If appellant’s story were believed, she committed no crime. Disregarding her story, which a jury could do, we look to the circumstantial evidence to see if it would fairly support a finding of voluntary manslaughter as well as murder.

This was an unusual occurrence. Between the parties there existed a close and friendly relationship. If we do not believe appellant’s story, the reason for this killing is obscure. Nothing indicates malice prior to the time the parties occupied the motel room. (They had been there about 2^/¡ hours.) It is conceivable that appellant for some reason decided to kill Taylor. An equally supportable theory is that under the influence of drink the parties took a sudden aversion to each other, that some sort of affray ensued, and the gun was fired in sudden heat and passion. According to appellant, a momentary scuffle did take place. The firing of the gun six times is strong evidence of an intent to kill, but the circumstantial evidence is as equally consistent with the lack of malice aforethought as with its presence.

If appellant was guilty, we do not believe the evidence points so clearly to the crime of murder as to exclude another reasonable inference that a lesser crime was committed. The circumstances are such that the cases of Nicoll v. Commonwealth, 169 Ky. 491, 184 S.W. 386; Johnson v. Commonwealth, 179 Ky. 40, 200 S.W. 35; and Davenport v. Commonwealth, 285 Ky. 628, 148 S.W.2d 1054 do not apply.

In our opinion the trial court committed error in failing to give an instruction on voluntary manslaughter.

Appellant does not contend for, and we do not think the evidence would support instructions on involuntary manslaughter.

Appellant raises other questions concerning the form of the instructions which do not merit serious discussion. Certain evidence alleged to be incompetent could not have been prejudicial.

The judgment is reversed with directions to grant appellant a new trial.


author: STEWART, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Arthur WOOD and Beulah Wood, His Wife, Appellees.
    Court of Appeals of Kentucky.
    June 5, 1964.
    John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., F. D. Curry, Patrick J. Dixon, Dept, of Highways, Frankfort, for appellant.
    William F. Threlkeld, Williamstown, for appellees.
   STEWART, Judge.

In this condemnation suit involving 132 acres, the jury allowed the land owners, Arthur Wood and Beulah Wood, his wife, $11,000 for the land taken, consisting of 33.86 acres, whereas the highest value placed on this property by any witness was $9311.50. Appellees argue that such a jury finding is not reversible error, since the whole amount awarded for both the land taken and the damages to the adjacent property is within the limits of the evidence introduced.

In Commonwealth, Department of Highways v. Treadway, Ky., 346 S.W.2d 296, the jury found $10,000 as damages to the remaining property, although the evidence showed maximum resulting damages of only $7433. This Court determined this amount was contrary to and in disregard of the evidence and reversed the judgment. It was pointed out the allowance for this item exceeded the proof introduced.

Appellees’ witnesses testified it would he necessary to rearrange the fencing by reason of splitting the farm in half because of the construction of the new highway. These witnesses estimated the number of rods for this purpose at 75 and the cost from $7.50 to $8.25 per rod. Here, however, the needed fencing along the interstate highway has been erected by the state. Thus, the only fencing made necessary (as defined in Smick v. Commonwealth, Ky., 268 S.W.2d 424). was taken care of. In Commonwealth Dept. of Highways v. Sherrod, Ky., 367 S.W.2d 844, decided after this case was tried, we held that fencing, internal or external, was no longer a separate item of damage.

Relocation of internal fencing becomes a matter of the personal prerogative and desire of the owner. Appellees contend the evidence as to the fencing proposed is proper in proving the diminution of the value to the remainder of the land. This Court held otherwise on an analogous point in Greenup County v. Redmond, Ky., 335 S.W.2d 335. As the fencing cost represents an expense which is not an element of recovery, under the facts stated, it should be excluded as a subject of proof in the event of another trial.

The Commonwealth’s complaint in respect to one of the instructions is well taken. The trial court established June 8, 1959, as the date of taking upon which the jury should fix the “before” value of the property in order to arrive at the total amount of recovery. The Commonwealth contends that August 25, 1958, was the proper date, as on that day a public hearing was held which informed the community in general of the public- improvement to be undertaken. Evidence by avowal was also introduced which disclosed the property values in Grant County increased 10% from and after August 25, 1958, to June 8, 1959, (the latter being the date of the county court order permitting condemnation of this property).

In a number of cases we have held the measure of recovery, in a case such as the one before us, is the difference between the fair market value of the property just before it was generally known the highway would be constructed and its fair market value just after the highway’s completion. See City of Ashland v. Queen, 254 Ky. 329, 71 S.W.2d 650. See also Hutcherson v. Louisville & N. R. Co., 247 Ky. 317, 57 S.W.2d 12; Watson v. Chesapeake & O. Ry. Co., 238 Ky. 31, 36 S.W.2d 641.

The instruction offered by the Commonwealth will be given, if the evidence be the same at another trial. The trial court will also limit the witnesses, who testify as to land values or’resulting damages, in accordance with the foregoing principle.

A final complaint is that the opinion evidence given by witnesses for the property owners lacked probative value, as they were unable to give facts to support their estimates of value or of damages. We have written on this subject so many times that it will serve no good purpose to repeat the principles to be adhered to in the introduction of evidence to establish the taking and resulting damages to real estate involved in a condemnation proceeding.

In the recent case of Commonwealth, Department of Highways v. Swift, Ky., 375 S.W.2d 691, we set forth certain criteria governing the qualification of witnesses and respecting the competency of evidence in condemnation cases. We make reference to these for the consideration of the trial court, if there be another trial.

Wherefore, the judgment is reversed for further proceedings consistent with this opinion.


author: WADDILL, Commissioner.

text:
    UNITED STATES FIDELITY & GUARANTY COMPANY, Appellant, v. Russell D. WELLS, d/b/a Wells Machine Shop, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.
    J. K. Wells, Paintsville, for appellant.
    R- B. Harrington, Paintsville, for ap-pellee.
   WADDILL, Commissioner.

This is an appeal from a judgment determining that the appellant insurer is liable under a policy insuring appellee against loss from liability for damage to property from the operation of appellee’s business. The policy excluded from its coverage “property in the care, custody or control of the insured or property as to which the insured for any purpose is exercising physical control.” The single question presented is whether an automobile owned by David Estepp, at the time it caught on fire, was in the care, custody or control of the appellee within the meaning of the exclusionary provision.

The case was submitted upon an agreed statement of facts from which it appears that David Estepp drove his automobile into appellee’s garage and employed him to weld a tailpipe assembly to the frame of his car. When appellee’s employee, Denver Staple-ton, informed Estepp it was not accepted practice to do this, Estepp insisted the work be done in this manner. Estepp held the tailpipe assembly while Stapleton did the welding. The use of the welding equipment in some way set the automobile on fire. Es-tepp jumped into the car and drove it outside the garage where it continued to burn. Estepp sued appellee for damages to his automobile and the appellant refused to defend the action relying on the exclusionary clause of the insurance policy. Trial resulted in a judgment in favor of Estepp and appellee subsequently filed this action.

In American Casualty Company of Reading, Pa. v. Pearson, 7 Utah 2d 37, 317 P.2d 954, a customer’s automobile was damaged by fire while it was located and being repaired in the insured’s garage. The policy contained an exclusionary provision identical with the one in the instant case. The Supreme Court of Utah, in affirming a judgment of nonliability under this policy, stated that the real test in determining liability under it was whether the insured had control over the car while it was being repaired. The court specifically said it could “see nothing in this case with respect to the care, custody or control of the car that negatived an ordinary bailment, where, for the purpose, and for a good consideration, an artisan is permitted to perform repairs.” This view is supported by the following cases: Guidici v. Pacific Automobile Ins. Co., 79 Cal.App.2d 128, 179 P.2d 337; Vaughan v. Home Indemnity Co., 86 Ga.App. 196, 71 S.W.2d 111; Lyon v. Aetna Casualty & Surety Co., 140 Conn. 304, 99 A.2d 141.

We conclude that at the time the Estepp car caught fire it was in the control of ap-pellee under the usual garage bailment arrangement and thus the exclusion in the policy involved herein is applicable.

The judgment is reversed with directions to enter a new one in accordance with this opinion.


author: MILLIKEN, Chief Justice.

text:
    Jason MOORE, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.
    Jason Moore, pro se.
    John B. Breckinridge, Atty. Gen., Martin Glazer, Asst. Atty. Gen., for appellee.
   MILLIKEN, Chief Justice.

Jason Moore has filed a motion to vacate his 1936 conviction as a habitual criminal, asserting among other things that he was not represented by or had the advice of counsel when he pleaded guilty to a charge of storehouse breaking (maximum penalty of five years) which resulted in his being sentenced to life imprisonment as a habitual criminal since the indictment charging him with storehouse breaking also recited that he had previously twice been convicted of felonies in the State of Tennessee.

No hearing was had on his motion and all we have before us is a copy of the clerk’s record of his conviction with no statement therein which discloses whether he had the advice of counsel at the time so that he might have appreciated the import of his plea of guilty. The trial court merely overruled the motion and Moore appealed.

Since the 1963 decision of the United States Supreme Court in Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 799, adequate counsel has become a necessary ingredient of state criminal trials in felony cases. (See, also, McIntosh v. Commonwealth, Ky., 368 S.W.2d 331.) Our RCr 11.42 sets forth the procedure to be followed by our trial courts in dealing with motions such as that presented in this case, so the order overruling the motion is set aside and the case remanded for a hearing on the motion, for the appointment of adequate counsel for the appellant if he is unable to employ counsel, for “findings determinative of the material issues of fact” and a final order accordingly.

The order denying the motion to vacate the judgment of conviction is set aside and the case remanded for proceedings as heretofore indicated.


author: CULLEN, Commissioner.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Dr. Phillip BROOKS et al., Appellees.
    Court of Appeals of Kentucky.
    June 5, 1964.
    John B, Breckinridge, Atty. Gen., Benjamin J. Mann, Asst. Atty. Gen., Frankfort, Dandridge F. Walton, Madisonville, for appellant.
    Louis P. McHenry, Hopkinsville, for ap-pellees.
   CULLEN, Commissioner.

A motion for appeal having been sustained, we have before us the appeal of the Commonwealth of Kentucky, Department of Highways, from a judgment in a highway condemnation suit awarding the ap-pellee landowners $500.

The appellees did not offer any evidence fixing value or damages in terms of money. The highest estimate by the appellant’s witnesses, for land taken and damages to the remainder, was $275.

At the close of the evidence the appellant moved for a directed verdict limiting the recovery to $275. The court overruled that motion and submitted the issue of damages to the jury, which returned a verdict for $500. The appellant then moved for judgment notwithstanding the verdict, which motion also was overruled.

Since the evidence would not support an award in excess of $275 the court erred in overruling the appellant’s motions. Pierson v. Commonwealth, Ky., 350 S.W.2d 487.

The judgment is reversed with directions to enter judgment awarding the appellees $275 only.


author: PALMORE, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Lucy SHACKLEFORD et al., Appellees.
    Court of Appeals of Kentucky.
    June 5, 1964.

      John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., Phillip K. Wicker, Somerset (Dept, of Hwys.), for appellant.
    Grant F. Knuckles, W. R. Lay, Pineville, Robert J. Watson, Middlesboro, for appel-lees.
   PALMORE, Judge.

This is one of several highway condemnation cases arising out of the relocation and reconstruction of U. S. 119 between Pineville and Harlan. As in Commonwealth, Dept. of Highways v. Slusher, Ky., 371 S.W.2d 851 (1963), Commonwealth, Dept. of Highways v. Howard, Ky., 375 S.W.2d 398 (1964), and Commonwealth, Dept. of Highways v. Lemar, Ky., 375 S.W.2d 678 (1964), it must be reversed for error in the refusal by the trial court to admit evidence of prices recently paid in private sales of comparable property. Appellees contend that the testimony was properly excluded because it- had not been shown that such sales were voluntary. “However, it has been said that there is a presumption, in the technical and proper meaning of that word, that the price of land sold was fixed freely and not under compulsion. In the absence of evidence warranting a finding that a sale is made under such compulsion as to make the price inadmissible as evidence of value, consideration may be given to the sale.” Nichols on Eminent Domain, § 21.31 (Vol. 5, p. 462).

It being unlikely that the other alleged errors of which the Commonwealth complains will re-occur upon a new trial it is unnecessary to discuss them.

The judgment is reversed with directions that a new trial be granted.


author: WILLIAMS, Judge.

text:
    Rufus ROBINETTE et al., Appellants, v. COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.

      P. H. Vincent, Edwin D. Rice, Ashland, for appellants.
    John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., for appellee.
   WILLIAMS, Judge.

The Department of Highways, Commonwealth of Kentucky, brought proceedings under KRS 177.081 to 177.089 to condemn 5.5 acres of a 65-acre farm and .43 acre of a non-contiguous 28-acre woodland plot, all owned by the appellants. Both parties appealed from the award of $12,638.32 allowed in the county court. The jury in the circuit court awarded $11,300 for the two segments taken. The landowners have appealed.

All buildings on the 65-acre farm were situated within the 5.5 acres taken, including a five-room house, barn, crib, 26 stanchion dairy barn, milk house, and other appurtenant structures. There were no buildings on the 28-acre tract, but the .43 acre taken was a level, cleared section providing access to the whole tract.

Appellants’ initial contention raises for the first time the issue of negotiation, which is a condition precedent to condemnation proceedings of this kind. The Commonwealth in its complaint alleged its inability to contract or agree with the owners for the purchase of the land. The appellants did not deny the allegation, did not object or assert as error the right to condemn for lack of good faith negotiation and did not offer instructions bearing on the issue of negotiation.

Generally, a court of review must limit its considerations to those issues raised below and ruled on by the trial court. Commonwealth, Dept. of Highways v. Williams, Ky., 317 S.W.2d 482 (1958). In condemnation proceedings only those issues raised in the Statement of Appeal, or in the original exceptions, may be considered by the circuit court. KRS 177.-087(1). Davis v. Commonwealth, Dept. of Highways, Ky., 374 S.W.2d 513 (1964) ; Commonwealth v. Mayo, Ky., 324 S.W.2d 802 (1959). Moreover, without an objection or offer of instructions based on the jurisdictional fact of negotiation, the submission of the question of damages to the jury is equivalent to recognizing the prior establishment of negotiation. See Kendall v. Commonwealth, 286 Ky. 59, 149 S.W.2d 787 (1941).

Raising a number of evidentiary issues, the appellants object (1) to the lack of similarity of comparable tracts to the land condemned; (2) to the remoteness of time of sale and distance of the comparable properties; and (3) to the admission in evidence of a picture of comparable property which was photographed five months after the date of the taking.

The issue of similarity centers around six sales of property offered in evidence as comparable to this property by two of the Commonwealth’s witnesses. Four of the tracts had houses, farm buildings and cleared pasture land. Timber was growing on three of the tracts, two of which had no buildings. Four of the tracts abutted blacktop roads. The properties were located within five miles of the property being condemned. The sales had been conducted one, two and three years previously. None of the tracts was operated as a dairy farm, but the witnesses considered the facilities readily adaptable to such use. One of the Commonwealth’s appraisers, Allan Parke, was permitted to introduce a photograph of the buildings on a tract he considered comparable although it was photographed five months after the taking. Parke did not testify that there had been no change between the date of sale and the time the photograph was made, but another witness who had made the sale as a realtor testified there had been no change.

If properties are reasonably similar to the condemned land and a qualified expert states that, in his opinion, they are sufficiently comparable for appraisal purposes, the actual sale prices are admissible with dissimilarities being a matter left to examination and cross-examination. Commonwealth, Dept. of Highways v. Oakland United Baptist Church, Ky., 372 S.W.2d 412 (1963); Commonwealth, Dept. of Highways v. Finley, Ky., 371 S.W.2d 854 (1963); Stewart v. Commonwealth, etc., Ky., 337 S.W.2d 880 (1960). The Commonwealth’s witnesses considered the properties sufficiently comparable for appraisal purposes. They stated their reasons for considering them comparable and explained the dissimilarities. Although the comparable properties were not dairy farms, they sufficiently resembled the appellants’ property to bear on the issue of value and be of aid to the jury.

The proximity of'the comparable properties to the appellants’ land and the time they were sold were not so remote as to destroy their probative worth as comparisons of valuation and as the basis for the opinion of the witnesses. All of the comparable properties were within five miles of the appellants’ land, and the sales were conducted within three years before the date of the taking. If distance or time ■of sale of comparable properties makes a difference, it is a matter to be developed by the expert under direct examination and cross-examination. Commonwealth, Dept. of Highways v. Lemar, Ky., 375 S.W.2d 678 (1964); West Kentucky Coal Company v. Commonwealth, etc., Ky., 368 S.W.2d 738 (1963).

The asserted error of admitting an unverified photograph of comparable property was remedied by the subsequent verification by the man who handled the sale of the property, who stated there had been no substantial change from the time of the sale to the time the photograph was taken. Generally, a photograph must be relevant to some material issue and not be prejudicial either by distortion, cumulative effect or grotesqueness. Since sales of comparable property are relevant as evidence of value, or as a basis for an expert’s opinion, such photographs may be said to be related to a material issue in the case. The degree of similarity of the properties must be weighed by the jury in determining damages and photographs of comparable properties may aid them in their considerations. The admission of a photograph is within the discretion of the trial judge. 32 C.J.S. Evidence § 716, p. 625.

Another contention of appellants is that the Commonwealth’s witnesses did not qualify as experts. They object to Allan Parke because he was not a native of Boyd County, never owned property in the county, never bought and sold property in the county, and had gained all his experience and knowledge of the value of Boyd County property from investigations made before and after the taking. Parke testified that he had five years’ appraisal experience with a private firm and had received special training in real estate appraisal. Not only had his work for the Commonwealth been primarily in Eastern Kentucky and in Boyd County, but he had investigated 125 to 150 sales in Boyd County to acquaint himself with the real estate market there. He had talked with buyers, sellers, real estate dealers and bankers. He made a personal inspection of the property being condemned.

In Commonwealth, Dept. of Highways v. Citizens Ice & Fuel Company, Ky., 365 S.W.2d 113 (1963), this Court recognized that an expert valuation witness need not be acquainted firsthand with land values in the vicinity of the property under consideration. If the expert witness establishes his qualifications, states he has studied the real estate market and has seen the property condemned, his opinion will support a verdict unless obviously unreasonable or shown to be without any supporting basis.

Appellants object to Fred Gesling because he was qualified to value the property only as coal land and was unable to give an opinion of general value based upon land sales. Gesling, a civil engineer for 50 years, spent nearly half his time investigating and acquiring rights to coal property. In his collection of 5,000 to 6,-000 mineral drillings, 50 were from Boyd County and one was drilled near the appellants’ property. He believed the presence of coal under appellants’ land did not add to its value because the overburden made stripping economically infeasible.

A witness who is qualified to render an opinion based on the availability of the property for a special use is not disqualified because he is unable to testify to its value for other purposes. Nichols, Eminent Domain, Vol. 5, section 18.41(3), (3d ed. 1962). The jury was entitled to consider whether the presence of coal had a hearing on the value of the property. The fact that Gesling could not put a value on the land in general was a matter for the jury to weigh.

W. H. Miller did not see the property before the buildings were removed. He testified concerning the value of the bare land. It was obvious to the jury that he based his estimate on the land without buildings. His testimony was apparently ignored because the jury awarded damages which substantially exceeded his opinion of the value. The appellants were not prejudiced by the admission of his testimony.

The appellants further complain that the Commonwealth’s witnesses did not consider the highest and best use of the land to be dairy farming, and that they were prejudiced by the failure to permit testimony showing the gross income from dairy operations which had been carried on there. The ultimate test of the type of use which is properly the criterion of market value is the use to which men of prudence and wisdom, having adequate means, would devote the property if owned by them. Nichols, Eminent Domain, Vol. 4, section 12.314, p. 140 (3d ed. 1962). There was no dairy operation at the time of the taking, but the landowners explained that the dairy had been moved after the Commonwealth advised them in 1959 of the proposed condemnation. The stated reason for abandoning the dairy was a new health regulation requiring a bulk tank cooler which appellants were unwilling to buy in view of the proposed condemnation. Witnesses for the Commonwealth made it clear they did not consider the land adaptable to a dairy operation without other acreage. There being a dispute about the best adaptable use of the land, the matter became a jury question. There was sufficient evidence to sustain the award of damages under either use of the property.

Gross income from farming, including milk sales, is a highly speculative measure of damages which is not admissible in condemnation proceedings. Where income is derived mainly from the skill of the operator rather than from the productivity of the property, testimony pertaining to that income should be excluded. Commonwealth, Dept. of Highways v. Smith, Ky., 358 S.W.2d 487 (1962) ; Commonwealth, Dept. of Highways v. Eubank, Ky., 369 S.W.2d 15 (1963).

Appellants contend further that the trial court erred in the instructions given, yet the appellants neither objected to the instructions nor offered any to correct the alleged errors at the trial. CR 51 prohibits as assignment of error the giving or failure to give an instruction unless the complaining party objects before the court instructs the jury and states specifically the matter and grounds for the objection. Blankenship v. Staton, Ky., 348 S.W.2d 925 (1961). See Clay, Kentucky Practice, Vol. 7, CR 51, p. 89, et seq.

Finally, appellants contend the award of the jury was inadequate. The jury awarded $300 for the .43 acre taken from the 28-acre tract. The lowest valuation placed on that tract by a Commonwealth witness was $464.50. The testimony of one of the appellants could have been construed in such manner as to permit the jury’s award to fall within permissible limits. The difference between the amount awarded by the jury and the value placed on the property by the Commonwealth’s witness was $164.50. Strangely enough the difference between an identical amount of $164.50 and $249.00 was the amount in controversy in Kappa v. Brewer, 207 Ky. 61, 268 S.W. 831 (1925). Judge Dietzman said in that case that for such a small amount the court would not reverse the judgment. To the same effect are Foley’s Adm’r v. Robertson’s Guardian, 215 Ky. 647, 286 S.W. 851 (1926) ; Nussbaum v. Standard By-Products Co., 216 Ky. 119, 287 S.W. 353 (1926) ; and Blanton v. Metz, Ky., 357 S.W.2d 306 (1962). Consequently, even if the appellants’ testimony were ignored, the amount involved is so trifling as not to warrant a reversal. The remaining portion of the award for the 5.5 acres taken was well within the range of competent valuation.

The judgment is affirmed.


text:
    J. K. GAUGH, Committee for Leonard J. Hambrick, Appellant, v. Katherine GATEWOOD et al., Appellees.
    Court of Appeals of Kentucky.
    April 17, 1964.
    Rehearing Denied Sept. 18, 1964.
    E. Durward Weldon, Georgetown, for appellant.
    Marion Rider, Frankfort, Bradley & Bradley, Georgetown, for appellee.
   STEWART, Judge.

Appellant, J. K. Gaugh as committee for Leonard J. Hambrick, filed this action on behalf of his ward, who is an incompetent person. Hambrick owns a life estate in a tract of 10yá acres known as “the fairgrounds farm.” Appellees are the remain-dermen under the will of Hambrick’s deceased wife.

The fairgrounds farm abuts for 336 feet on a public street known as Highland Court in the City of Georgetown. In 1960 that city proceeded to construct and reconstruct a portion of Highland Court with high type improvements consisting of an asphalt pavement and permanent storm sewer facilities. In 1961 it levied a street improvement tax upon the property in the sum of $1661.07. The entire amount became due in a lump sum, as there was no provision for installment payments.

The life tenant was 84 years of age in 1961 and his annual income from the fairgrounds farm is approximately $1200, which accrues principally from the sale of tobacco; In addition, he receives house rent in the sum of $50 per month and lot rent in the amount of $400 per annum. Hambrick is confined in the Eastern State Hospital at Lexington and his obligations for his monthly care of $127.50 and for taking care of ad valorem taxes, insurance and upkeep on the property consume most of his income.

A declaratory judgment was sought by appellant, his committee, to determine whether the life tenant or the remaindermen became liable for the payment of the street and sewer improvement assessments on the real estate owned by the parties. The circuit court decreed the life tenant liable for the entire amount of the assessments, and from the judgment entered appellant has prosecuted this appeal.

In all but a few jurisdictions, the rule seems to be well settled that, if the public improvement made by a municipality or other local political subdivision affecting real estate, is permanent in nature the cost of the special assessment thereafter imposed on the property should not be borne entirely by the life tenant but the remainderman should pay some portion thereof. The basic reason advanced for relieving a life interest from the entire cost of a special assessment for a permanent improvement, or from the cost of one which outlasts the life interest in duration, is that the special assessment levied for such public improvement is different in nature from an ordinary annual tax. See 33 Am.Jur., Life Estates, Remainders, etc., sec. 460, p. 992.

33 Am.Jur., on the same subject, in the same section and on the same page, states thus as to what may constitute a public improvement placed by a municipality as a lien on real property: “Permanent public improvements have, among other types of activity, been held in some cases to include the opening, widening, grading, and paving of streets and highways, the construction of a sewer or drainage ditch, and in some jurisdictions the paving of a sidewalk, although in other states such sidewalk paving is regarded as an improvement of a temporary character.”

In Hackworth v. Louisville Artificial Stone Co., 106 Ky. 234, 50 S.W. 33, an early case decided in 1899, this Court determined that the replacement of a sidewalk in front of a business house was a repair for which the life tenant should pay. (Emphasis added.) However, the opinion stated that “the burden of paying for the improvement of a street by original construction, which adds permanently to the value of abutting lots, must be apportioned between the estate of the life tenant and the remainder-man.”

In 1901 in Brodie v. Parsons, 64 S.W. 426, 23 Ky.Law Rep. 831, the Court held, citing the Hackworth case, that the life tenant must pay the cost of reconstructing a sidewalk where the old one had been worn out by long use, stating that the improvement was in the nature of a repair essential to the proper enjoyment of the property. The general rule was again recognized. In 1907 in Delker v. City of Owensboro, 98 S.W. 1031, 30 Ky.Law Rep. 440, it was held the life estate was primarily liable for the cost of replacing a worn-out sidewalk in front of the land. The Court of Appeals in the latter cited the Hackworth case but distinguished a sidewalk from a permanent street improvement.

In 1932 Thomas v. Thomas’ Guardian et al., 244 Ky. 724, 51 S.W.2d 949, involved the question of sewer and street assessments, and the Court, citing the Hackworth and Delker cases as authority, ruled the life tenant alone responsible for the entire cost of constructing streets, sidewalks or sewers. In 1938 in the case of Vaughn v. Metcalf, 274 Ky. 379, 118 S.W.2d 727, only the question of who should pay ad valorem taxes was in issue and this Court, relying upon the Thomas and Delker cases, included a statement by way of dictum in the opinion that the life tenant was liable alone not only for the payment of ad valorem taxes, but for all street improvement assessments.

It would thus appear the Thomas case is the only decision that sets its face squarely against the principle laid down in the Hackworth case. Actually, the former misconstrued the holding in the latter opinion, because the Hackworth case recognized that a life tenant should not be charged with the whole amount of an assessment for a public improvement that is permanent. We therefore conclude this Court in the Thomas case fell into error and that the rule recited in the Hackworth case should be reaffirmed and prevail henceforth.

In most of the cases an equitable apportionment of some sort whereby the life tenant and remainderman share the burden in proportion to their respective interests, as nearly as they can be determined under the varying circumstances of such cases, has been effected or at least has been regarded as proper. The courts have generally found it unnecessary to attempt to lay down any stricter rule than that an equitable apportionment should be made which should take into proper consideration the probable duration of the improvement as compared with the life expectancy of the life tenant. See Annotation, 83 A.L. R. 797, 798.

Wherefore, the judgment is reversed and the case is remanded for further proceedings in conformity with this opinion.


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    TERRAFIRMA, INC., Appellant, v. Wasley S. KROGDAHL et al., Appellees.
    Court of Appeals of Kentucky.
    June 26, 1964.
    Rehearing Denied Sept. 18, 1964.
    Trimble & Trimble, Lexington, for appellant.
    F. Selby Hurst, Lexington, for appel-lees.
   JOHN CHRIS CORNETT, Special Commissioner.

Terrafirma, Inc. appeals from an order of the Fayette Circuit Court overruling its motion to set aside a default judgment. CR 55.02 and 60.02.

The appellees filed a complaint against the appellant and John J. Murphy and Patricia Murphy on July 25, 1961. -Summons was served on all defendants on July 26, 1961. The dispute concerned alleged misrepresentations of appellant concerning frontage of a building lot.

The appellees filed a motion for judgment by default against appellant on September 22, 1961, giving notice to attorney for Murphy defendants that the motion would be heard on September 29, 1961. At that time no defensive pleading or motion had been filed or served as required. CR 12.01.

Default judgment was granted against appellant and case was assigned to October 9th to assess damages.

October 7 appellant learned of judgment by default and employed an attorney,

On October 9th trial to assess damages was had by the court, without a jury, and damages were fixed and judgment entered in the sum of $4,750. At that trial appellant introduced no evidence.

The appellant made timely motion on October 10th to set aside the judgment by default and filed the affidavit of Richard C. Sutherland, Jr., Vice-President of Terra-firma, Inc., defendant below and appellant herein, in which he stated that the attorney, with whom he had discussed the case a few days after summons had been served, had notified him that he could not represent appellant in this action, since there was a conflict of interest with the co-defendant, Murphys, and that said attorney advised him and the Murphys to employ other counsel.

The Murphys employed other counsel who related to Mr. Sutherland that he had procured an extension of time to file an answer for the Murphys by agreement with the attorney for appellees.

Mr. Sutherland thought this would give Terrafirma a like extension, and that attorney for co-defendants would let him know. Thereafter, Mr. Sutherland appears to have forgotten the suit due to pressing business matters, and in the meantime judgment was entered against defendant, Terrafirma, Inc.

More than sixty days had elapsed after summons was served, and appellant had not served or filed defense. The learned trial judge heard the evidence of the appellees as to damages and awarded a sum of $4,750, which was almost as large an amount as the appellees had paid appellant for the lot in the beginning. This court cannot say that the trial judge abused its discretion in overruling the motion to set aside the default judgment, or that the damages were excessive, since no record of the evidence has been filed in this court.

A party is not entitled to have a default judgment set aside unless he can show a reasonable excuse and establish that he has not been guilty of unreasonable delay himself. CR 55.02 and CR 60.02.

The court is of the opinion, under the Rules of Civil Procedure, that appellant should have employed an attorney to have looked after this case before judgment was entered by default. Appellant should not have waited from July 26 until October 7, since the rules require some step to be taken within twenty days from the service of summons.

See Crowder v. American Mutual Liability Ins. Co., Ky., 379 S.W.2d 236 (decided May 15, 1964).

Therefore, it is our opinion that the judgment should be affirmed.

The opinion is approved by the court, and the judgment is affirmed.


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    Rena TRENT, Appellant, v. Curtis CARROLL et al., Appellees.
    Court of Appeals of Kentucky.
    March 20, 1964.
    As Modified on Denial of Rehearing June 19, 1964.

      Henry R. Wilhoit, Jr., Wilhoit & Wilhoit, Grayson, for appellant.
    Thomas D. Theobald, Jr., Grayson, for W. W. Lewis and Gussie Lewis, appellees.
   MONTGOMERY, Judge.

Rena Trent recovered a judgment for $6,150 against Curtis Carroll as compensation for injuries sustained. She then filed this action to set aside a deed from Carroll to W. W. Lewis as a fraudulent conveyance under KRS 378.010. Lewis alone defended. Judgment was rendered dismissing her complaint. Appellant contends that appellee Lewis was not a purchaser in good faith and that the consideration paid for the property was not equal to its reasonable value.

Appellant was injured on April 25, 1960. She spent nine weeks in a hospital. Carroll paid $840 on the hospital bill, leaving a part unpaid, and gave appellant $500 in addition. No release was taken from her. On July 6, 1960, Carroll conveyed a 430-acre farm to Lewis for $5,500 in cash. The record indicates that Carroll had no other property in Kentucky.

On or about April 15, 1961, appellant sued for damages. Service was had on Carroll pursuant to KRS 188.030 as a nonresident. Carroll’s wife had been residing in Ohio for several years. Carroll had spent part of his time in Ohio and the remainder on the farm. When he sold the farm he became a permanent resident of Ohio. He did not appear or testify in the fraudulent conveyance action.

Among other things the Chancellor found that in July 1960, before the conveyance, Lewis had had an attorney search the title records on the farm for the existence of liens or suits, with negative results; that Carroll had advised Lewis that he had settled fully appellant’s claim; that Lewis had paid Carroll a fair price for the property; and that “the defendant, W. W. Lewis, used all precautions to check the title to said property, and that he had no notice of any ■claim against said property.”

The finding of the Chancellor on the issue of fair price must be sustained. The evidence as to the value of the farm varied from $4,000 to $15,000. The farm had a quantity of merchantable timber and ■a 1.9-acre tobacco base. Lewis received the ■current tobacco crop in the purchase. There was proof that Lewis had offered more for the farm before the accident; that he told a neighbor immediately after the purchase that the farm was worth $10,-•000; and that he also had said that he had “got it cheap enough” and it “looked like he had a good bargain.” On the conflicting evidence though, we are unable to say that the Chancellor’s finding of a fair price is ■clearly erroneous. CR 52.01. However, such testimony is significant in consideration of the question of good faith.

KRS 378.010, concerning fraudulent conveyances, contains the following: “This section shall not affect the title of a purchaser for a valuable consideration, unless it appears that he had notice of the fraudulent intent of his immediate grantor * * Upon the findings made the Chancellor concluded, as a matter of law, that Lewis “used all reasonable means to ascertain the condition of the title of the said property, and that the conveyance was made for an adequate consideration, and in good faith.”

From the record it is concluded that Carroll fraudulently intended to defeat the claim of appellant. When a conveyance is attacked as fraudulent and badges of fraud are shown, the burden of proof to show good faith is on the grantee. McDonough v. McGowan, 165 Ky. 425, 177 S.W. 277; Alt v. Burt, Ky., 242 S.W.2d 974.

“Badges of fraud” are conspicuous in this case. The transfer of the farm in anticipation of or pending a lawsuit is a badge of fraud. Hager v. Coleman, 307 Ky. 74, 208 S.W.2d 518. Carroll unquestionably transferred his property to defeat appellant’s claim. The transfer of all of Carroll’s property subject to execution in the state is another badge of fraud. Allen v. Ligon, 175 Ky. 767, 194 S.W. 1050; Pope v. Cawood, 293 Ky. 660, 170 S.W.2d 55; Wolf v. Eblen, 6 Cir., 101 F.2d 469. The farm transferred by Carroll to Lewis was the only property shown to have been owned by him at the time. In Sewell v. Damrell’s Adm’r, Ky., 267 S.W.2d 398, it was held that “[i]f a transfer is made by one against whom there is pending an action for tort, this is a badge of fraud, especially where the conveyance leaves the grantor without any estate.” Inadequacy of consideration is another badge. Campbell v. First Nat. Bank of Barbourville, 234 Ky. 697, 27 S.W.2d 975; Trustees of First Nat. Bank of Stanford v. Saufley, 268 Ky. 732, 105 S.W.2d 605.

Apparently the Chancellor rested his conclusion of “good faith” on the findings that Lewis had had the title examined and had been advised by Carroll that the claim had been settled. When there are badges of fraud the purchaser is put on inquiry, and his good faith depends upon the sufficiency and reasonableness of his inquiry. 55 Am.Jur., Vendor and Purchaser, Section 703, pages 1080 and 1081.

Lewis made no inquiry of appellant as to whether her claim was settled or of the hospital where her bill had been partially paid, although little effort would have been required to do so. There are strong indications that Lewis did inquire at the office of appellant’s attorney and was advised that the claim had not been settled. In his testimony Lewis did not deny such questions when asked and sought to evade them. His testimony on this point on cross-examination follows:

“Q.-l Doc, was this occasion when you say that Carroll came there to your place and you made that deal with him, how long was that after you had been down to my office to ask if Carroll and Rena Trent had settled?
“A.- That was in July.
“Q.-2 You had sometime before that come to my office, and you knew I represented her?
“A.- I can’t tell you that definite.
“Q.-3 Did you come there and ask me and I told you?
“A.- Yes, sir, I know him mighty well and he said he wanted to settle with that woman. I think he wrote her a letter. And I went to Tom Theobald. He said he paid that woman’s hospital bill and she wasn’t satisfied, said they will agree with him for her time. And I never heard it mentioned any more until the time he sold me—
“Q.-4 But at the time you came to my office I told you that the claim had not been settled and I warned you — ■
“A.- I don’t remember—
“Q.-5 I told you at that time it wasn’t settled and warned you against your buying that property as long as—
“A.- I—
“Q.-6 And you said you would go up and get Tom Theobald, didn’t you? Didn’t you mention that to me ? And I warned you about that ?
“A.- When was that ? I never — you talking about when I bought it ? You are talking about when I bought it. Nothing filed or nothing started on it when I bought it.
“Q.-7 But I told you at the time that the claim had not been settled and she still had a claim.
“A.- I never heard no claim about it. They wasn’t nothing started.”

If Lewis had not been in the office of appellant’s attorney inquiring about the settlement of the claim, a simple denial would have been sufficient. Llis evasive and unresponsive answers are a failure to deny, which constitutes an admission. When one fails to speak up, if the occasion demands it, the failure to do so is tantamount to an admission. The testimony of Lewis indicates strongly that he thought he could color the transaction with good faith by a title search and by reliance on Carroll, who was tainted with fraud.

The burden was on Lewis. It was his duty to rebut the inference created by the badges of fraud and sustain the good faith of the transaction. McDonough v. McGowan, 165 Ky. 425, 177 S.W. 277; Myers Dry Goods Company v. Webb, 297 Ky. 696, 181 S.W.2d 56; Sewell v. Damrell’s Adm’r, Ky., 267 S.W.2d 398. Under the circumstances Lewis has failed to do so. The finding that Lewis “had no notice of any claim against said property” is irrelevant. There is no finding that Lewis had no notice of appellant’s claim. The court’s conclusion of law that Lewis acted in good faith is not based on appropriate findings of fact. CR 52.01.

Judgment reversed.


author: DAVIS, Commissioner.

text:
    HOME FINANCE COMPANY, Appellant, v. W. B. FRAZIER, Appellee.
    Court of Appeals of Kentucky.
    June 5, 1964.

      Sutton & Martin, Corbin, for appellant.
    Herman Tye, Barbourville, for appel-lee.
   DAVIS, Commissioner.

Appellee W. B. Frazier obtained jury verdict and judgment for $2,000 in Knox Circuit Court against appellant Home Finance Company, based on his claim that appellant had wrongfully converted two Ford trucks which appellee had purchasd on conditional sales contracts. We sustained appellant’s motion for appeal. KRS 21.080; RCA 1.180. Our conclusion in the case makes it unnecessary to enumerate the various points argued in briefs.

Appellee purchased two Ford trucks from Cumberland Ford Motor Company; one of them was bought May 8 and the other on May 22, 1956. Appellee executed a conditional sales contract for each truck, substantially identical except as to dates and amounts. Appellant purchased the conditional sales contracts; appellee made numerous payments to appellant.

Each conditional sales contract provided for eighteen deferred monthly payments. It is conceded that appellee was often delinquent in his payments, and that he was delinquent in his account on November 15, 1957, at which time appellant repossessed both of the trucks. Appellee was not present in person at the time of repossession of either truck (they were taken into possession by appellant’s agent at separate places). However, there was no breach of peace or other disturbance incident to the repossessions. Each of the conditional sales contracts specifically provided for repossession rights in the appellant. On December 19, 1957, appellant sold both trucks at auction, after notice to appellee; appellee attended the sale, but made no bid.

Appellee communicated with appellant’s agent the day after the repossessions, and sought permission to pay the account to a current basis, but this was refused. The-day after that appellee claims he proposed to pay the account in full, but this offer was rejected also. In this respect, there is contrariety in the evidence; appellee-claims that he offered to pay the sum he-estimated remaining due, but that appellant demanded a substantially higher-amount. On the other hand, appellant denies that appellee made any offer to pay in full. According to the books of appellant the appellee owed $1,062.46 on one-truck and $854.51 on the other at the time-they were repossessed. It is shown that the truck on which the larger sum was-owed brought $850 when sold by appellant, leaving a deficiency of $212.46. The other truck was sold for $535, resulting in a claimed deficiency of $319.51. Appel-lee did not present evidence discrediting-the accounting of appellant; neither did his evidence truly dispute the asserted balances against him.

Appellee had equipped each of the trucks-with a bed suitable for handling coal, stone and gravel; hoists sufficient to dump the beds were affixed to the vehicles by ap-pellee. When the trucks were repossessed this added equipment was on them. On November 29, 1957, appellant’s attorney wrote appellee and advised that appellant made no claim to the dump beds. In the letter appellee was informed that he could “pick them up” at any time he desired. However, appellee took the position that he had no obligation to obtain the beds-(which were then in Pineville). Appellant apparently took that view too, for it subsequently caused them to be returned, to appellee by leaving them in a field on his premises. Appellee stated that when these beds were returned he discovered that “the power take off and universal joints and drive shafts” were missings also, he asserted “the pump on one of them was broke.”

Two days before the sale date appel-lee filed suit charging illegal conversion of the trucks and their appurtenant beds. He sought damages, compensatory and punitive, in the aggregate amount of $10,-100, or the return of the property. The complaint sought a restraining order to prevent the proposed sale, but this remedy was not pursued; no restraining order was issued.

One of the trucks had been in a minor accident on the day it was repossessed. Appellee alleged that he had collision insurance on the truck, and that either appellant or the insurance company should be required to pay the damages to the truck by reason of the accident; the insurance company was not made party to the suit, nor was there any showing of the extent of the collision damage. Appellee testified that the insurance was $100 deductible, so that no liability would have attached to the insurance company until the damage exceeded $100.

Appellant filed answer and counterclaim, by which it alleged appellee’s default on the conditional sales contracts, the exercise of its right of peaceful repossession, the auction sale of the trucks, and sought recovery of $531.97 as the aggregate of the deficiencies between the sales prices of the trucks and the amounts due from appellee.

Appellee contends that since he had been permitted to make late payments on several occasions the appellant waived any right to repossession. This argument overlooks the fact that the contracts specifically provide, “Any action to enforce payment hereunder or any indulgences or rearrangements granted the Purchaser shall not be a waiver of or affect any rights of a holder hereof.” Appellee quotes 47 Am. Jur., Sales, § 899, to support his argument. However, he failed to observe or quote that portion of the cited text noting that the parties may validly agree that the acceptance of delayed payments shall not waive strict performance. We hold the quoted contract provision valid.

Appellee maintained that appellant had no right to repossession except by court order. The contrary rule is too well known to admit of argument. General Motors Acceptance Corp. v. Dickinson, 249 Ky. 422, 60 S.W.2d 967; 16A Ky.Dig., Sales, «=>479(1).

Neither may the appellee complain as to the beds and other additions which he had placed on the trucks. This question was resolved adversely to appellee’s contention in Black Motor Co. v. Foure, 266 Ky. 431, 99 S.W.2d 177; 43 A.L.R.2d 819, § 3. Each conditional sales contract contained this language:

“ * * * that all equipment, tires, accessories and parts shall become part of the Car by accession; * * * ”

Under these circumstances, the appellee could not frustrate appellant’s right of peaceable repossession by the expedient of placing an accessory on the vehicle.

No effort was made to show bad faith or lack of diligence in the conduct of the sales after repossession. As noted, appel-lee was present at the sale; he made m> bid. Neither did he express any dissatisfaction with the sale or the manner of conducting it.

The complaint sought punitive damages, but that issue was not specifically submitted by the instructions. Punitive damages could not have been allowed in the circumstances shown here. Home Finance Co. v. Ratliff, Ky., 374 S.W.2d 494.

No illegal action of appellant was proved; the appellant’s motion for directed verdict should have been sustained. However, as appellant did not file motion for judgment notwithstanding the verdict as provided by CR 50.02, we remand the case for new trial, with direction that if the evidence on another trial is substantially the same as upon the first, there shall be a directed verdict against recovery by appellee and allowing appellant recovery upon its counterclaim.

The judgment is reversed for proceedings consistent with this opinion.


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    PIKE MOTOR COMPANY, Inc., et al., Appellants, v. Stuart H. ADAMS et al., Appellees.
    Court of Appeals of Kentucky.
    June 5, 1964.
    L. D. May, Pikeville, W. A. Johnson, Paintsville, for appellants.
    O. T. Hinton, Pikeville, George Chad Perry, III, Paintsville, for appellees.
   STEWART, Judge.

Appellees, Stuart H. Adams and Geneva Adams, have failed to file a brief and, pursuant to RCA 1.260, we have elected to invoke the application of subsections (1) and (2) in deciding this case, namely: “Accept appellant’s statement of the facts and issues as correct, (and) reverse if appellant’s brief reasonably appears to sustain such action.”

On March 21, 1956, Brown-Tomblin Ford Sales, Inc., a West Virginia corporation which later changed its name to Tomblin-Ford Co., Inc., having qualified to do business in Kentucky, negotiated with appellees, Stuart H. Adams and Geneva Adams, to purchase a Ford agency in Paintsville, buy the stock of merchandise, parts and equipment, and lease the building in which the Ford agency was operating for a period of five years at a rental of $600 per month. The management incorporators and stockholders were Herbert Brown and Sam Tomblin. (A sister of the latter was a nominal incorporator and stockholder.) Later, Brown sold his shares of stock to J. W. Tomblin, Jr., a brother of Sam Tomblin and also a stockholder in and president of Pike Motor Co., Inc., which carried on the Ford agency in Pikeville.

In March, 1958, Tomblin-Ford Co., Inc., was in financial difficulties; it was two months behind in rent and had no operating capital. Sam Tomblin, president of Tomblin-Ford Co., Inc., moved the business out of the building. On March 11, 1958, appellees instituted suit against Tomblin-Ford Co., Inc., for $1800 rent that was past due. They secured an attachment and took possession of the building and the property therein. The attachment, however, was discharged on March 15, 1958,

Nothing further occurred until January 30, 1960, when appellees filed an amended complaint, asking that J. W. Tomblin, Jr., and Pike Motor Co., Inc., appellants herein, as well as Brown-Tomblin Ford Sales, Inc., and Matewan Motor Co., (a West Virginia corporation which was absorbed by Brown-Tomblin Ford Sales, Inc.) be made parties defendant This pleading alleged in substance that the debt due aggregates $7500 for rent which is in arrears; that J. W. Tomblin, Jr., is the sole owner of the “so-called” corporations named in the complaint and amended complaint; that they are not in fact or in law legally constituted or operating corporations but are merely names under which J. W. Tomblin, Jr., does business; or, if they are corporations, that J. W. Tomblin, Jr., is the sole owner and manager of them and individually liable for all their acts and undertakings; and that these corporations are indebted to J. W. Tomblin, Jr., to the extent of their full net assets, and he owns all such assets.

At the trial in January, 1961, the jury found for appellees in the sum of $7500, plus 6% interest from December 15, 1958, against Tomblin-Ford Co., Inc., Pike Motor Co., Inc., and J. W. Tomblin, Jr. From the judgment entered on this verdict J. W. Tomblin, Jr., and Pike Motor Co., Inc., have appealed.

KRS 271.215(2) states: “A shareholder of a corporation * * * shall not be personally liable for any debt or liability of the corporation.”

J. W. Tomblin, Jr., in testifying, stated he was very much interested in assisting his brother, Sam Tomblin, in every possible way with the new business in Paints-ville; and that the Pike Motor Co., Inc., in order to get this new business off to a good start, became an endorser on a note of Sam Tomblin and Herbert Brown for $20,000. He further stated that Brown in 1957, wanting to get out of the Ford agency at Paintsville, sold him his interest in the corporation and he became an unwilling stockholder but not an officer of Tomblin-Ford Co., Inc. His reason for taking this step was in order to help salvage the business.

Appellees did not undertake to prove any of the allegations in their amended complaint to the effect that any of the corporations named therein were not legally organized and maintained. It was conclusively shown the Pike Motor Co., Inc., and Tomblin-Ford Co., Inc., were separate and distinct corporate entities, and their only relationship to each other was that of debtor and creditor. An effort was made on the part of appellees to prove these two corporations had commingled their property, but it is our view the evidence fell far short of establishing such a fact.

We are therefore of the opinion the trial court should have sustained the motion for a directed verdict made on behalf of appellants, Pike Motor Co., Inc., and J. W. Tomblin, Jr., at the completion of appellees’ evidence and again at the completion of all the evidence. Neither the Pike Motor Co., Inc., nor J. W. Tomblin, Jr., under the evidence introduced became even remotely liable for the debts of Tomb-lin-Ford Co., Inc.

Wherefore, the judgment is reversed and the case is remanded for consistent proceedings.


text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Nelson HOUCHINS et al., Appellees.
    Court of Appeals of Kentucky.
    June 5, 1964.

      John B. Breckinridge, Atty. Gen., Frankfort, James H. Lucas, Asst. Atty. Gen., Bowling Green, for appellant.
    B. M. Vincent, Brownsville, for appellees.
   CULLEN, Commissioner.

A motion for appeal having been sustained, we have before us the appeal of the Commonwealth of Kentucky, Department of Highways, from a judgment in a highway condemnation suit awarding the appellee landowners $2500.

The only error asserted is the overruling by the trial court of appellant’s motion that the jury be sent to view the premises. Under KRS 177.087 the appellant was entitled to have the jury view the premises, and the overruling of the motion was error. Commonwealth, Dept. of Highways v. Farra, Ky., 338 S.W.2d 696. A substantial portion of the damage claimed by the appellees was attributed to destruction of alleged building-lot value. The appellant maintained that the land was never topographically suitable for building lots. Under these circumstances we think the error in refusing to send the jury to view the premises was prejudicial.

The judgment is reversed with directions for a new trial.