author: MASSEY, Chief Justice.

text:
    CONROY MORTGAGE CORPORATION, Appellant, v. Robert E. B. FIELDER et al., Appellees.
    No. 16513.
    Court of Civil Appeals of Texas. Fort Worth.
    Jan. 24, 1964.
    Rehearing Denied Feb. 21, 1964.

      Wm. Andress, Jr., Dallas, for appellant.
    Bondurant & Cribbs, and Wm. L. Bon-durant, Arlington, for appellees.
   MASSEY, Chief Justice.

This is an appeal from a judgment in trespass to try title to realty in Tarrant County, Texas, in so far as it was rendered in favor of plaintiff Robert E. B. Fielder as against defendant Conroy Mortgage Corporation.

Judgment is affirmed.

Conroy Mortgage Corporation will hereinafter be styled appellant, and Fielder will be referred to as appellee. Robert W. Rogers will be referred to as Rogers.

In 1951 appellee sold a house and lot to Rogers. Pursuant thereto he accepted a $16,000.00 vendor’s lien note. The obligation was secured by a vendor’s lien on the property conveyed, and further secured by a deed of trust. These instruments gave the right to appellee to pay the taxes accruing against the property, but did not make it his obligation. They embraced the agreement on the part of Rogers to pay such taxes, and it was his obligation.

By late 1959 there was owing an ar-rearage of taxes, plus penalties and interest, of more than $2,000.00. Suit of foreclosure was threatened by tax authorities. Rogers and the appellant entered into a transaction under and in accordance with which the appellant, at the special instance and request of Rogers, paid $2,350.62 as delinquent taxes on the property. (Since that time appellant paid subsequently accrued taxes.) From Rogers, in consideration thereof, the appellant took assignments of the tax liens, and a demand note secured by a deed of trust upon the property, containing the usual power of sale plus recitations relative to its being subrogated to the tax liens. No tax officer authorized to collect such taxes ever transferred the lien securing the same over unto the appellant. See Vernon’s Ann.Civ.St.Tex. Art. 7345a, “(Delinquent Taxes) Transfer of tax lien”. It is of interest to note the inhibition of said article against foreclosure against the property for the period of twelve (12) months after payment of such taxes, as against one to whom the tax lien is transferred under its authority.

Later in 1961 the appellant purportedly foreclosed the lien given it by Rogers, under authority of the Deed of Trust securing the obligation of Rogers to the appellant, heretofore referred to. There was no proceeding in any court. The sale was under authority of the 1961 Deed of Trust and took place on November 7, 1961. The appellant purchased the property for a consideration of $2,500.00 under deed of the trustee. It is not established in the record whether the appellee did or did not have actual knowledge of said sale, but from the briefs of the parties it is apparently not a matter of dispute but that the appellee was uninformed and did not learn of it until some time afterward. Through arrangement with the appellant Rogers remained in possession of the property under some form of rental agreement. Thereafter the appellee took action to foreclose under his mortgage. On December 5, 1961 the property was sold under the authority of the 1951 Deed of Trust, given to secure the ap-pellee at the time he sold the property to Rogers. Appellee purchased the property for an amount less than the debt owed him and received a trustee’s deed from the substitute trustee.

Afterward appellee filed suit in trespass to try title as against Rogers. Appellant was joined as party defendant. Both appellant and appellee moved for summary judgment.

The suit became somewhat involved as between Rogers and the appellee in respect to the matter of Rogers’ claim for damages and for accounting, and in respect to the appellee’s claim against Rogers for rents. The court entered an order severing these questions into a separate action pending, leaving the case under the number and style originally docketed as a suit for title and possession to the subject property — with the appellee on the one side as adversary to the appellant and Rogers on the other. In this case the court granted a summary judgment awarding appellee title and possession of the property (describing it) as against Rogers and the appellant, subject only to obligation imposed on appellee to repay the appellant the amount expended for taxes, together with interest and penalties accrued thereon, in the amount of $3,158.46. Such had been tendered by the appellee in his pleadings before the hearing. The $3,158.46 was paid into the registry of the court afterward, when the amount was ascertained by the court.

Rogers did not appeal. Appellant did.

In Trimble v. Farmer, 1957, 157 Tex. 533, 305 S.W.2d 157, 161, it was stated that V.A.T.S. Art. 7345a provides that “the tax lien may be transferred under the conditions set out in Art. 7345a, ‘and not otherwise’ ”. For purposes of the opinion the statement seems to be dictum. If the statement correctly sets out the law the appellant never received the tax lien at all, even by way of subrogation. Appellant may have been possessed of the right to have the lien transferred to it, but never availed itself thereof, and hence never enjoyed a position different from that which would have been existent if it had loaned Rogers an amount of money equivalent to the total of the delinquent taxes, and which money Rogers-used for some other purpose. Under such hypothesis appellant received nothing more than a second lien on the property.

Dotson v. Pahl, 1947 (Tex.Civ.App., Austin), 206 S.W.2d 272, held to the contrary. Therein the court said that Art. 7345a did not purport to restrict private contracts and agreements with respect to the payment of taxes, but as stated “merely regulates the transfer of a tax lien by the tax officer”. The effect of the holding was that the validity of the transaction thereunder consideration, not to be distinguished from that before us antecedent to appellant’s purported foreclosure under the 1961 Deed of Trust, extended beyond the property owner whose delinquent taxes were paid affecting antecedent liens, — and that the tax lien was transferred to him who paid them under the equitable doctrine of subrogation, and remained a lien upon the property first and prior to any other. The decision of the trial court, affirmed on appeal, was in a suit to foreclose the tax lien. Attempted sale under deed of trust foreclosure proceedings was not in question.

The decision in the Dotson v. Pahl case, supra, followed the holdings of Texas Bank & Trust Co. v. Bankers’ Life Co., 1931 (Tex.Civ.App., Waco), 43 S.W.2d 631, error refused, and of First State Bank of Maypearl v. National Life Ins. Co., 1932 (Tex.Civ.App., Waco), 51 S.W.2d 646. In neither case was there a dispute relative to antecedent action taken under purported authority of deeds of trust. Both suits were filed to foreclose liens. A case of similarity was McDermott v. Steck Co., 1940 (Tex.Civ.App., Austin), 138 S.W.2d 1106, error refused. In that case it is interesting to note that the court held that one who paid taxes on the property of another under circumstances creating (under principles of subrogation) a lien prior to an antecedent judgment lien, is so subrogated only to the extent necessary for his own equitable protection. In all the aforesaid Texas cases it appears that opportunity was afforded him whose lien would have been prior but for the existence of the tax lien to pay off the •debt secured thereby and be thus restored to his prior favored position. Of course ■such was not done in the instant case nor could it be done in any case where foreclosure is accomplished through a sale under authority of a deed of trust.

The opinion in the case of Fest v. Williams, 1935 (Tex.Civ.App., San Antonio), 89 S.W.2d 1072, cannot be considered as authority in this case. There was no dispute in that case between lienholders upon whose lien was first and prior, and whose was secondary.

There is a line of cases holding contrary to that of the Waco and Austin Courts of Civil Appeals. There have been holdings in Massachusetts, Maryland, Georgia and Arkansas which were in accord. See 61 A.L.R. 587 (supplemented at 106 A.L.R. 1212), Annotation : “Right of one who pays taxes for which another is bound, to subrogation to the right of the taxing power.”

In the cases by the Waco and Austin Courts of Civil Appeals the parties apparently rendered obeisance to provisions of V.A.T.S. Art. 7328a, “Tax sales of real estate”, Art. 7326, “Suits to foreclose tax lien”, and Art. 7328, “Proceedings in tax suits”. (The articles are listed as they presently exist under the Revised Civil Statutes of 1925.) This statement is made because there was no apparent deviation from statutory provisions thereof by any of the parties in any of the cases.

Art. 7328a provides: “That all sales of real estate made for the collection of delinquent taxes due thereon shall be made only after the foreclosure of tax lien securing same has been had in a court of competent jurisdiction in accordance with existing laws governing the foreclosure of tax liens in delinquent tax suits”. Art. 7326 prescribes the manner in which tax liens may be enforced by the taxing authorities as: “ * * * Such suit shall be brought as an ordinary foreclosure for debt, with averments as to the existence of a lien upon such land for such taxes, * * * and shall pray for judgment for the foreclosure of the said lien and sale of said lands as under ordinary execution. * * * ” Art. 7328 directs that all record lienholders shall be made parties defendant in any suit to foreclose a tax lien.

The appellant contends that V.A.T.S. Art. 7345a, “(Delinquent Taxes) Transfer of tax lien”, is wholly inapplicable in this case. Appellant founds the premise for propriety to disregard that statute on a contention that the article merely provided an “additional” form (of procedure) for transfer of tax liens; that it was enacted for the relief of persons threatened with loss of their property because of delinquent taxes thereon during the “depression” years. Such was the opinion of the court in Dotson v. Pahl, supra.

Appellee, on the other hand, contends that Art. 7345a is controlling. Under that article it would seem that appellant’s lien would be secondary and the debt thereby secured satisfiable only if the property brought more than enough to pay the debt owing the appellee. Yet, however, the ap-pellee at all times has conceded that appellant is entitled to have reimbursement of the amount expended by it to pay Rogers’ delinquent taxes and other taxes on the property. Appellee tendered whatever the proper amount might be, as determined by the court. The court’s judgment determined the proper amount, and conditioned appellee’s award thereunder upon its payment. Appellee paid such into the registry of the court. He has not advanced any cross-point of error on the appeal by which he complains because he has been required to make the payment.

Therefore it seems that appellee is in the position of conceding that appellant’s lien is a tax lien, and as such is prior to his own, but that at least as against him, (his being the only outstanding lien of record against the property), appellant would have absolutely no right to foreclose the same under authority of any deed of trust — and could only foreclose the same (as a first and prior tax lien) and support a sale of the property by a suit for that purpose brought in a court of competent jurisdiction, followed by a sale authorized in the judgment. See V.A. T.S. Arts. 7328a, 7326, and 7328. Waiving right to require appellant to resort to such procedure, however, appellee affirms his willingness to repay appellant’s expenditure in a discharge of the appellant’s lien, as a valid prior lien (equitable, if not legal) in order to protect his title. See McDermott v. Steck Co., supra.

In any event the law is with the appellee. Judgment would be treated as having been properly rendered for appellee and against the appellant under any test we are required to make by the points of error presented.

Judgment is affirmed.


source: Caselaw Access Project

author: HIGHTOWER, Chief Justice.

license: Public Domain

text:
    Sam McFARLAND, Appellant, v. Leon JONES, Angelina County, Appellees.
    No. 6599.
    Court of Civil Appeals of Texas. Beaumont.
    May 10, 1963.
    Rehearing Denied June 12, 1963.
    Charles K. Ruth, Lufkin, for appellant.
    H. R. Rolston, Lufkin, for intervenor.
    Dan Brazil, Garrison, Renfrow, Zeles-key, Cornelius & Rogers, Lufkin, for ap-pellees.
   HIGHTOWER, Chief Justice.

The structure or buildings in which appellant was arrested for gambling were not shown to have been “gambling houses”, as that term is defined in Schepps v. City of El Paso, Tex.Civ.App., 338 S.W.2d 955. The sum of $1,984.00 found upon the person of appellant and ordered confiscated by the trial court was not, under the circumstances and evidence, subject to confiscation within the meaning of Art. 636 and 637, Vernon’s Annotated Penal Code of Texas, Schepps v. City of El Paso, supra.; Jones v. Pettigrew, Tex.Civ.App., 328 S.W.2d 450; Davis v. State, Tex.Civ.App., 165 S.W.2d 757. Nor was the money sought to be confiscated commingled with gambling equipment or paraphernalia in such manner as to constitute it an integral part thereof within the meaning of Art. 636, 637, supra. See opinion by this court of April 25, 1963, Demaris, et al. v. State, Tex.Civ.App., 367 S.W.2d 909.

Appellant’s contention that he is entitled to interest on his money from the date of its confiscation is deemed to be without merit. Jones v. Pettigrew, supra.

The judgment of the trial court confiscating appellant’s money aforesaid is reversed and judgment is here rendered that said sum he returned to appellant.

Reversed and rendered.


author: MOORE, Justice.

text:
    WARLICK PRESS, INC., Appellant, v. LANTEX CONSTRUCTION COMPANY, Appellee.
    No. 20.
    Court of Civil Appeals of Texas. Tyler.
    Jan. 30, 1964.
    Dean Carlton, Turner, Atwood, Meer & Francis, Dallas, for appellant
    Robert E. Bums, Burford, Ryburn & Ford, Dallas, for appellee.
   MOORE, Justice.

Plaintiff, Lantex Construction Company, a corporation, brought this suit against War-lick Press, Inc., defendant, alleging that the defendant breached an oral contract by failing and refusing to pay an agreed fee for plaintiff’s services in preparing and furnishing written plans and specifications for a proposed building. The parties will be referred to as they appeared in the Trial Court.

Plaintiff plead that the defendant agreed to pay plaintiff 6% of the construction cost of the proposed building, as a fee for services in the preparation of the plans and specifications, if in the event the contract for construction thereof should be awarded to some other builder, other than plaintiff.

Defendant, both by its pleadings and the evidence, denied that it ever entered into any such contract or promised any fee for the preparation of the. plans and specifications.

The record shows that the plaintiff was not awarded'the contract and did not build the building. The contract was awarded to Mr. Edgar A. Guest, who built the building.

The record further shows that Lantex Construction Company is a corporation and that Mr. A. A. Lander at all times pertinent to this suit was its president. He was the only witness called to testify on behalf of the plaintiff in connection with the alleged contract and cost of construction. According to Mr. Lander’s testimony, after several months of negotiation and assistance to the officials of the defendant company in launching their building program, he was instructed to prepare a set of plans and specifications for the proposed building. After he had completed the plans, he carried them to the office of Mr. Wiersing, the president of Warlick Press, Inc., and upon going over the plans with Mr. Wiersing, he seemed to be well satisfied with them and requested Mr. Lander to submit his bid for the construction of the proposed building. He testified that at this meeting he advised Mr. Wiersing that if in the event his company was not awarded the contract, his company would expect to be paid 6% of the construction cost of the building as compensation for his services in preparing the plans and specifications. He testified that Mr. Wiersing agreed to pay such an amount; that thereafter he submitted his bid to the company in the amount of $94,-000.00; that thereafter Mr. Peakman, a representative of defendant company, called him and advised him that the company had refused to accept his bid and had awarded the contract to Mr. Guest; that in this conversation he advised Mr. Peakman that he would expect pay for his services for the preparation of the plans and specifications, to which Mr. Peakman replied, “We certainly intend to do that * * * send us a bill”; that Warlick Press, Inc., then sent one of their representatives to pick up the plans and specifications; that he prepared six sets for their use and turned them over to the representative ond received a written receipt therefor from Mr. Guest; that he sent his bill to the defendant in the amount of $5,038.60, which represents 6% of the construction cost of the proposed building, but that the defendant has never paid the bill nor any part thereof.

Although there is some controversy as to what was meant by the term “construction cost,” we think it abundantly clear from Mr. Lander’s testimony he meant his proposed, actual, net construction cost. He testified that his bill was based upon his actual net construction cost, including that of all subcontractors. His testimony as to the amount of his proposed construction cost, had he built the building, was however to some extent indefinite. At one place in his testimony he testified that his net cost was $83,-000.00, and then testified that it was $83,-971.00, and at another place he testified that his actual cost would have been “eighty-three thousand, I would say, eighty-four, right at eighty-four or $85,000.”

After a trial before a jury, only two special issues were submitted, viz., whether there was an express oral agreement that plaintiff would be compensated for the plans and specifications at the rate of 6% of construction cost of said building, and whether the plans were substantially complete. Each issue was answered in the affirmative in favor of the plaintiff.

Defendant objected to the court’s charge before its submission to the jury because the charge did not contain an additional issue concerning damages, i. e., the construction cost of the building. The objection was overruled. Based upon the jury’s verdict the Trial Court entered judgment for the plaintiff in the amount of $5,038.60, and from such judgment has perfected this appeal.

Appellant has assigned nine points of error. Points 4 and 5 allege error because the Trial Court, over its objection, refused to submit an issue upon construction cost. Appellant asserts that the question of construction cost was material to the ascertainment of damages.

It appears to us that the construction cost of the proposed building is an ultimate, controlling fact issue of the plaintiff’s case. Obviously, there must be a finding of fact on this question; otherwise, it would be impossible to calculate the amount of money due and owing the plaintiff under the terms of the contract.

Although the judgment does not contain any findings of fact or otherwise show how the court calculated the $5,038.60 as the amount due, apparently the court reasoned that since the testimony by Mr. Lander on the construction cost of the building was not in any way controverted or disputed, no question of fact was raised on the issue requiring its submission to the jury.

In failing to submit the issue on construction cost, we think the Trial Court fell into error.

As pointed out above, Mr. Lander’s testimony was the only testimony offered by the plaintiff on the contract and on the amount of construction cost. Mr. Lander, as president of Lantex Construction Company, was an interested witness. The testimony he gave in connection with construction cost is of such nature that it cannot be readily contradicted if untrue, because his own estimate and opinion of the construction cost was wholly within his own knowledge. Furthermore, as pointed out above, his estimate of the construction cost is somewhat indefinite.

It is now well settled that, where “evidence on an issue comes from an interested source, especially where vague, inconsistent, and conflicting in some respects, or where the nature of such testimony is such that it cannot be readily contradicted if untrue, an issue involving the credibility of the witness and the weight to be given his testimony is then presented and the matter must be submitted to the jury for their determination. Carwile v. Roberts, Tex.Civ.App., 11 S.W.2d 549; Goodrich v. Pandem Oil Corp., Tex.Com.App., 48 S.W.2d 606; Octane Oil Refining Co. v. Blankenship-Antilley Implement Co., Tex.Civ.App., 117 S.W.2d 885; Stanley v. Lieb, Tex.Civ.App., 243 S.W.2d 227; Owen Development Co. v. Calvert, 157 Tex. 212, 302 S.W.2d 640; Taylor & Son, Inc. v. Arlington Ind. School Dist., 160 Tex. 617, 335 S.W.2d 371. The jury, in such cases, may reject the interested testimony and make their findings on circumstantial evidence. Carwile v. Roberts, supra; R. T. Herrin Petroleum Transport Co. v. Proctor, 161 Tex. 222, 338 S.W.2d 422.

The fact that Mr. Guest constructed the building for $75,000.00 is a circumstance which the jury might take into consideration in arriving at the cost of construction as testified to by Mr. Lander.

As an alternative to reversal, plaintiff urges that we suggest a remittitur. The failure of the trial court, however, to submit the material issue upon construction cost to the jury cannot he corrected by this Court by remittitur. Southland Life Ins. Co. v. Ballew, Tex.Civ.App., 268 S.W. 1027.

In view of the ruling which we have made in this case, requiring another trial, it is not necessary to discuss the numerous other points of error assigned by appellant.

The judgment of the Trial Court is reversed and the casé is remanded.


author: STEPHENSON, Justice.

text:
    JACKSON BREWING COMPANY, Appellant, v. Jack D. CLARKE, Jr., Appellee.
    No. 6669.
    Court of Civil Appeals of Texas. Beaumont.
    Jan. 30, 1964.
    Rehearing Denied Feb. 19, 1964.

      Kelley & Ryan, Houston, for appellant.
    McClain & Harrell, Conroe, for appellee.
   STEPHENSON, Justice.

Plaintiff brought this action to cancel a claim defendant had against plaintiff for beer sold to him. Defendant filed a cross-action to recover from plaintiff the sales price of the beer. Judgment was rendered for plaintiff upon a finding of the jury to the effect that the indebtedness had been incurred in a transaction which violated the Texas Antitrust laws.

The jury found in answer to the first special issue that the beer was sold by defendant to plaintiff under an agreement that plaintiff would sell the beer only in a limited specific territory, that defendant would not sell beer to anyone else in that same territory and that the beer was to be sold by plaintiff only at a wholesale price fixed by defendant. The jury failed to agree upon the answers to the remaining six issues covering matters of cancellation of the debt, payment of the debt and attorney’s fee. The parties will be referred to here as they were in the trial court.

Defendant contends the transactions involved were exclusively in interstate commerce and not subject to the antitrust laws of Texas. It is agreed that all sales made were F.O.B., New Orleans, Louisiana, and that the beer was shipped from New Orleans, Louisiana, to Conroe, Texas.

The plaintiff alleged the agreement under which this beer was sold, was in violation of the antitrust laws of the State of Texas, and was specifically in violation of Articles 7426, 7428 and 7437 of Vernon’s Ann.Civ. St. A portion of Art. 7426 reads as follows :

“Art. 7426. ‘Trusts’
“A ‘trust’ is a combination of capital, skill or acts by two or more persons, firms, corporations or associations of persons, or either two or more of them for either, any or all of the following purposes :
“1. To create, or which may tend to create, or carry out restrictions in trade or commerce * * * or to create or carry out restrictions in the free pursuit of any business authorized or permitted by laws of this State.
******
“5. To make * * * or carry out any contract * * * to preclude a free and unrestricted competition among themselves or others in the sale or transportation of any such article or commodity * * *.
“7. To abstain from engaging in or continuing business, or from the purchase or sale of merchandise, produce or commodities partially or entirely within the State of Texas, or any portion thereof.”

A portion of Art. 7428 reads as follows:

“Art. 7428. Conspiracies against trade
“Either or any of the following acts shall constitute a conspiracy in restraint of trade:
“1. Where any two or more persons, firms, corporations or associations of persons, who are engaged in buying or selling any article of merchandise * * * enter into an agreement or undertaking to refuse to buy from or sell to any other person, firm, corporation or association of persons, any article of merchandise, produce or commodity.”

Art. 7437 reads as follows:

“Art. 7437. All agreements in violation of, void
“Any contract or agreement in violation of any provision of this subdivision shall be absolutely void and not enforcible either in law or equity.”


author: CLAYTON, Justice.

text:
    ST. PAUL FIRE & MARINE INS. CO. v. FOSTER
    Stubbeman, McRae, Sealy & Laughlin, Rush Moody, Jr., Midland, for appellant.
    Warren Burnett and Bill Alexander, Odessa, for appellee.
   CLAYTON, Justice.

This is a workmen’s compensation case in which the plaintiff recovered a judgment against defendant, based on jury findings, for total and permanent loss of use of both feet. Plaintiff alleged in his petition that “he is entitled to recover $35.00 per week for 401 weeks for his injuries and disability as provided by the Workmen’s Compensation Act.” In his voir dire examination of the jury panel plaintiff’s attorney told the panel: “We contend in this case that he (plaintiff) has suffered what is known in the law as the total loss of use of both of his feet, and is, therefore, entitled to recover the maximum benefits under this policy. That is to say, $35.00 a week for a total period of four hundred and one weeks.” Plaintiff was interrupted at this point by counsel for defendant who, out of the presence and hearing of the jury, dictated a motion for mistrial “on the sole basis that the attorney for the plaintiff advised the jury of the legal effects of their answers to the issues which would be submitted in this case.” The trial court reserved ruling upon this motion and the case proceeded to trial and was submitted to the jury on special issues. The jury, in answer to such issues, and under appropriate instructions, found that the injury to each of plaintiff’s feet resulted in total loss of use of each foot from the day of the injury and that such loss of use of each foot was “permanent”. Questions as to temporary and partial loss of use of each foot were unanswered. When the verdict was read by the court the attorney for defendant renewed his motion for mistrial, setting out that the prejudicial effects of the remarks made by plaintiff’s counsel on voir dire had been demonstrated and that it was affirmatively shown that harm did result to the defendant from such prejudicial remarks. Thereafter the motion for mistrial was overruled by the court and judgment entered for plaintiff, to which action exception was taken and this appeal perfected.

Appellant directs his two points of error to the court’s failure to grant his motion for mistrial based on the contentions that the attorney for the plaintiff had advised the jury of the legal effects of their answers to the issues which would be submitted in the case and that harm had resulted to the defendant therefrom. Appellant cites the case of McFaddin v. Hebert, 118 Tex. 314, 15 S.W.2d 213, a 1929 Commission of Appeals decision adopted by the Supreme Court. The following is quoted from that opinion:

“Clearly, the prime object, purpose, and intent of the law for submitting cases on special issues is to remove the jury from any bias in favor of, or prejudice against, either party to the suit, to relieve them from the duty of directly passing on who shall prevail in the suit, and to make it the duty of the jury to answer each question truly as they find the facts to be from the evidence, without regard to what the result of their answers may he. If the court or the attorney, or any one else, is allowed to tell the jury the legal result of the answers, and to appeal to them in argument to so frame their answers so as to accomplish a result rather than to answer the issues truly as they find the facts to be from the evidence, * * * the law providing for special issue verdicts would be an idle and vain thing.” (Emphasis supplied.)

In the cited case the Court of Civil Appeals, in certifying the question which was answered by the Commission of Appeals, stated that after the special issues were submitted to the jury the plaintiffs’ attorney in argument “told the jury that if they wanted to render a verdict in behalf of the plaintiffs, to answer said special issue (No. 1) ‘yes’ * * This statement, and subsequent argument of the attorney, clearly required a finding of reversible error by the Commission of Appeals, and such finding was supported by the authorities quoted from by the Commission. But we find several features in the cited case which serve to distinguish it from the case at hand. For example, in the cited case, the special issues involved were already before the jury and the attorney was pointing out what the answer to each special issue should be in order to constitute a verdict for the plaintiffs. He even went to the extent of requesting the jury to take down the figures which they should give as their answers to the several special issues, and several of the jurors did take down the figures given, all over the strenuous objections of defendant’s attorneys, which were overruled by the court. In the instant case, the jury had not heard the case or received the submitted issues, and could not have known, at the time the complained-of remarks were made, whether or not the remarks were relevant to any particular issue in the case. Further, it is a matter of some conjecture whether the wording of the special issues, when submitted, could have given those jurors who might have remembered the plaintiff’s attorney’s remarks any clue as to the meaning of the “$35.00 a week” and the period of “four hundred and one weeks” in connection with the answers to individual special issues. The jury merely answered that the loss of use of each foot was “permanent”. In Texas Employers’ Insurance Association v. Rigsby, 273 S.W.2d 681 (Tex.Civ.App., 1954; N.W.H.), the following is to be found:

“By its fifth point the appellant complains of the trial court’s action in permitting counsel for plaintiff in the trial court, over its objection, to read to the jury that portion of plaintiff’s original petition in which he alleged that he was entitled to recover 401 weeks of Workmen’s Compensation insurance at the rate of sixty percent of his average weekly wage, not to exceed $25.00 per week. At the beginning of the trial, before the voir dire examination of the jury, appellant’s counsel moved the court to instruct counsel not to inform the jury that he was seeking insurance at the rate of $25.00 per week for a period of 401 weeks and that counsel be prevented from reading that portion of his petition to the jury. The reason for the motion, as stated, was that it was not proper for the jury to know the amount of money plaintiff was seeking or the rate of compensation he was seeking, since to do so would inform the jury of these facts or impart information to them with which they are not concerned, since the jury would then be informed of the legal effect of its findings. In support of this point the appellant relies upon the case of Ex parte Fisher, 146 Tex. 328, 206 S.W.2d 1000 by the Supreme Court. We are

The petition having been presented to the Court was granted and the Clerk issued the writs, and a hearing was set for September 10, 1963 in the Courtroom in Austin, Texas.

The children were turned over to the Sheriff by Mr. Knapp.

On September 9, 1963 Walter Lee Knapp, Jr. and Deann Knapp filed a plea of privilege to be sued in Potter County, Texas, duly verified, and at the same time and subject to their plea of privilege the defendants filed their cross-action seeking a modification of the original judgment in Potter County as to the custody and control of the children, reciting changed conditions.

On September 10, 1963 the petitioner filed her motion for a non-suit and such motion was granted, and the petition for habeas corpus and attachment were in all things dismissed, without prejudice to petitioner and without prejudice to the counter claim of respondents.

The petitioner filed an answer and counter claim and the counter claim of respondents and that of petitioner are pending un-disposed of in the District Court of Travis County and subject to trial and disposition.

On October 2, 1963 the plea of privilege of the defendants was overruled.

The appeal is from the action of the Trial Court in overruling the plea of privilege of the appellant.

Appellee has filed her motion to dismiss the appeal and we believe such motion should be granted and the appeal is dismissed. The action to which the plea is directed is no longer in existence.

No objection was made to the order granting the non-suit, and the issues raised by the plea of privilege were rendered moot by the non-suit. McNeill v. Hubert, 119 Tex. 18, 23 S.W.2d 331; Gladden v. Thurmond et al., Tex.Civ.App., 77 S.W.2d 703; Johnson v. Galloway, Tex.Civ.App., 277 S.W.2d 127; Rule 164, Texas Rules of Civil Procedure; Quarles v. Glover, Tex.Civ.App., 335 S.W.2d 446.

The appeal is dismissed.

Appeal dismissed.


author: MOREMEN, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Virgil RALEIGH et al., Appellees.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.
    John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., Dept, of Highways, Jarvis Allen, Pikeville, for appellant.
    Don A. Ward, Hazard, for appellee.
   MOREMEN, Judge.

Appellant, Department of Highways, condemned two parcels of land of approximately one-twentieth of an acre each which belonged to appellees, Mr. and Mrs. Raleigh. The landowners were awarded the sum of $400.

The sole issue at the trial was the market value of the condemned land. The landowners’ witnesses valued the land taken at $750, $650, and $500. The Commonwealth’s witnesses valued the land at $15 and $13.

On this appeal it is argued that the court erred: (1) in refusing to strike from the evidence the testimony of Virgil Raleigh; (2) in failing to strike the testimony of two witnesses for the landowners; (3) in striking the testimony of a witness introduced by the Commonwealth; and (4) in not sustaining a motion to set aside the swearing of the jury because of certain remarks made in the opening statement by counsel for the landowners.

Virgil Raleigh qualified by stating that he knew the market value of property in the neighborhood and had seen property bought and sold there, but on cross-exam-¡nation it was indicated that his estimate was primarily based on three improper factors: unwillingness to sell; knowledge of other condemnation awards; and an erroneous belief that he would be denied access to the highway.

In order to determine whether his testimony should have been stricken, it is necessary to review our recent decisions on this question. In Barron v. Phelps, Ky., 238 S.W.2d 1016, the rule was announced that a witness would be permitted to give an opinion on land value merely because he was the owner. No other qualification was necessary. Two later decisions limited this rule. Allen Co., Inc. v. Thoroughbred Motor Court, Inc., Ky., 272 S.W.2d 343, where it was stated that an officer of a corporate land owner would not qualify as would an owner, and Hipp-Green Lumber Corp., v. Potter, Ky., 271 S.W.2d 892, where it was held that the owner of a motel was not, because of the mere fact of ownership, competent to testify concerning its value. The next opinion to interpret this rule was in Commonwealth Dept. of Highways v. Tyree, Ky., 365 S.W.2d 472, wherein the Court reiterated that an owner usually qualified merely because of the fact that he owned the property. It was stated, however, that the owner could lose his qualification if, during the course of the trial, the basis of his opinion as to value was shown to be improper because it involved an irrelevant measure of value or a legally non-compensable element of value. In such cases it was said that his testimony should be stricken.

In a recent case, Commonwealth Dept. of Highways v. Fister, Ky., 373 S.W.2d 720, decided October 25, 1963, the rule was changed to the effect that an owner of realty “shall not be presumed adequately qualified to express an opinion of market values by reason of ownership alone.” The owner must qualify before testifying as must any other witness. The changes made by that opinion, however, applied only after the issuance of the mandate in said case. Therefore, the instant case is governed by the law as stated in the Tyree case. Under the rule of that case, we have no hesitancy in holding that the court should have sustained the motion to strike Raleigh’s estimate of value. See also West Kentucky Coal Co. v. Commonwealth, Ky., 368 S.W.2d 738.

Appellant next contends that the court erred in failing to strike the testimony of two witnesses for the condemnee. Apparently these witnesses were competent to express their opinions as to value because it does not appear in the record that these estimates were based “solely or primarily” on improper factors.

Appellant argues that the court erred in striking the testimony of Mike Frost, a witness for the Commonwealth. The witness qualified by stating that he was acquainted with the fair market value of property in the county and was familiar with the property involved in this action. On cross-examination, however, the witness testified that he was not acquainted with the selling price of land in the area of the creek where Raleigh’s land was located. On redirect he stated that he knew market values of the same type of land in other parts of the county. The court excluded his testimony because he did not know the value of land in the neighborhood. This Court has stated that distance is not a fatal dissimilarity when dealing with rural property-. Therefore, exclusion of this testimony was error. West Kentucky Coal Co. v. Commonwealth, Ky., 368 S.W.2d 738.

The last objection by the Commonwealth concerns conduct of counsel. The attorney for the landowneis stated in his opening statement to the jury that the commissioners had appraised the property at $15 only. He also stated he would show that a woman had tried to purchase the tract owned by Raleigh for $300. The court sustained objections, but did not admonish the jury. The Commonwealth contends that these statements had a prejudicial effect on the mind of the jury. Whether prejudicial or harmless, these statements were improper and should not be made upon a new trial.

Because there is so much confusion in the record as to the size and shape of the land involved, the jury should be given a view of the premises.

Judgment reversed.


author: CULLEN, Commissioner.

text:
    COMMONWEALTH of Kentucky, by and on relation of James V. MARCUM, Commissioner of Revenue, Appellant, v. L. C. SMITH et al., Appellees.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.

      William S. Riley, Dept, of Revenue, Virginia R. Collins, Dept, of Revenue, Frankfort, James H. Amberg, Hickman, for appellant.
    W. C. Tipton, Hickman, James H. Warren, Fulton, Robert D. Fry, Union City, Tenn., for appellees.
   CULLEN, Commissioner.

Mrs. Ruth Boaz, a resident of Mississippi but who owned five tracts of land in Kentucky, died intestate in 1951. No administration of her estate was had in Kentucky, but an inheritance tax return was filed by her heirs in 1952 and a determination of tax was made by the Kentucky Department of Revenue in 1953. Before the return was filed her heirs had sold four of the tracts of land. In 1958 the Commissioner of Revenue brought the instant action against the heirs and the purchasers of the four tracts to enforce a lien for the inheritance tax. In 1959 a partial judgment was entered determining the tax liability of the estate of Mrs. Boaz and ordering a sale of the one tract of land that the heirs still owned. That tract was sold but the proceeds were not sufficient to satisfy the tax liability. The action then was submitted on the claim for enforcement of a lien against the other four tracts. The trial court entered judgment in 1961 dismissing the claim on the ground that the inheritance tax law was unconstitutional. That judgment was appealed and was reversed. See Commonwealth by and ex rel. Scent v. Smith, Ky., 353 S.W.2d 557. Upon remand of the case, in 1962, the trial court entered another judgment dismissing the claim on the grounds that the plaintiff had failed to prove his allegation (denied by answer) of taxes due and owing, and had failed to perfect a lien that could be enforced against the defendants as bona fide purchasers for value. The instant appeal is by the Commissioner of Revenue from the 1962 judgment.

Certified copies of the records of the Department of Revenue showing the assessment of the Boaz inheritance tax were attached to the complaint in this action as exhibits. The appellees concede that had these copies been introduced in evidence they would have been sufficient to establish, prima facie, the validity of the assessment, but the appellees maintain that the mere attaching of the copies to the complaint as exhibits did not give them any evidentiary force. (No evidence was introduced in the case.)

We do not consider it necessary to pass upon the question of whether an exhibit to a complaint can have evidentiary force (at least in an action tried by the court without a jury), because in our opinion the 1959 partial judgment in this case eliminated the validity of the tax assessment as an issue in this case.

The 1959 judgment followed a pretrial conference of which all the defendants were given notice. It recited that “that portion of this case involving the tax liability of the estate of Ruth Taylor Boaz” had been submitted, and it adjudged that there was due and owing to the State of Kentucky a specified amount of tax, interest and penalty. Subsequent to the entry of this judgment no motion or order was made to put back in issue the question of the validity and amount of the tax assessment.

CR 16 pi'ovides that a pre-trial order limits the issues and “controls the subsequent course of the action, unless modified at or before the trial to prevent manifest injustice.” The 1959 judgment had all of the features of a pre-trial order and in our opinion the issues eliminated from the case by that order could be reinstated only upon a modification of the order, and then only to prevent manifest injustice. The law is well settled that the parties are bound by a pre-trial order. See Sapp v. Massey, Ky., 358 S.W.2d 490.

Since the question of the validity and amount of the tax assessment was no longer in issue at the time of the entry of the 1962 judgment, the court erred in dismissing the complaint for a lack of proof of the assessment.

The second ground upon which the complaint was dismissed was that the tax lien could not be enforced against the four tracts of land which the heirs of Mrs. Boaz had sold to the other defendants, because the state had not filed notice of the tax lien in the office of the county court clerk before the sales were made. The sales were made a few months after the death of Mrs. Boaz in 1951. The heirs did not file a tax return until 1952, and the tax assessment was not made until 1953. A lien notice was filed with the county court clerk after the assessment was made.

A question of statutory interpretation is presented. KRS 140.190, which is a part of the inheritance tax law, provides that an inheritance tax shall be a lien on the property transferred (i. e., the property passing from the decedent to the heirs, legatees or devisees) until the tax is paid. As to personal property it provides that the lien shall not affect the property after it has passed to a bona fide purchaser for value, but as to real property it says only that the lien may be discharged by payment of the tax. Another statute, KRS 134.420, which is a part of the general tax laws, provides for the existence of a lien on all of the property of a taxpayer who owes any of various kinds of taxes, including inheritance tax. This statute calls for the filing of a notice of lien with the county court clerk, which shall be constructive notice of the lien, and it states that the lien shall not be good as against a purchaser for value without actual or constructive notice.

There is nothing in the history of the two statutes to furnish a basis for giving one complete precedence over the other, so they must be reconciled and both be given effect as far as possible.

We think that KRS 140.190, with reasonable clarity, provides that there shall be a lien on the property transferred which, as respects real estate, shall be valid as against a purchaser for value without any notice of lien having been filed. Since the meaning of the statute is clear, there is no application of the rule stated in Louisville Title Mortgage Co. v. Commonwealth ex rel. Unemployment Compensation Commission, 299 Ky. 224, 184 S.W.2d 963, that an ambiguous tax lien statute will not be construed to make the lien enforceable as against purchasers for value without notice of lien having been filed prior to the purchase. The statute as so construed does not impose any unfair or unreasonable burden because any purchaser of property from a decedent’s estate may reasonably be charged with notice that the property may be subject to inheritance tax liability.

KRS 134.420, on the other hand, imposes a lien on all property of a taxpayer, including property not involved in any taxable transfer or transaction. The purchaser of the latter kind of property would have no way of knowing of the possible existence of the lien without notice of lien having been filed. So the legislature has prescribed that the lien under KRS 134.420 shall not be valid against a purchaser for value unless notice has been filed. It is true that this statute, as it relates to inheritance taxes, in terms applies to the lien on the property transferred as well as on other property. But KRS 140.-190 provides for a lien on the property transferred that is effective against a purchaser of real estate without notice having been filed. In our opinion a proper reconciliation of the two statutes requires that, with respect to inheritance taxes, KIRS 134.-420 be considered to apply only to property other than the property transferred.

It is our conclusion that the trial court erroneously dismissed the complaint.

The judgment is reversed with directions to enter judgment for the plaintiff.


author: CLAY, Commissioner.

text:
    BUSINESS REALTY, INC., et al., Appellants, v. NOAH’S DOVE LODGE #20, etc., Appellees.
    Court of Appeals of Kentucky.
    Oct. 25, 1963.
    As Modified on Denial of Rehearing Feb. 14, 1964.

      Davies & Hirschfeld, Newport, Ware & Ware, Covington, for appellants.
    Thomas Hardesty, Newport, Turner & Jones, New Castle, for appellees.
   CLAY, Commissioner.

This suit was brought against an adjoining landowner and a contractor to recover damages to' a building caused by the removal of lateral support by excavation work. The jury returned a verdict for $26,200 (including $1200 punitive damages) and judgment was entered for “the plaintiff Noah’s Dove Lodge #20”. Appellant defendants assign nine different errors.

This case has several unusual features. The endless pleadings and motions are almost incomprehensible. There is really no dispute with respect to the basic liability of one or both of the defendants for the damage caused to the building. See 1 Am.Jur.2d, Adjoining Landowners, sections 44 and 45 (page 732). There is extended controversy concerning the real parties in interest and the nature and amount of damages.

Defendant Business Realty, Inc. owned real estate on West Sixth Street in Newport. Adjoining it is what is known as the “Odd Fellows Hall”. The latter consists of three buildings erected at different times but according to the evidence they were so closely integrated as to constitute a single unit. The other defendant, Fredericks, doing excavation work for Business Realty, Inc., impaired the lateral support of one of the Odd Fellows’ buildings, causing the walls, floors, and general structure to be substantially damaged.

Suit was brought by “Noah’s Dove Lodge #20, Encampment #12, Independent Order of Odd Fellows, By Its I. O. O. F. Hall Board Association”. Thereafter by pleadings and motions defendants raised the issue that the plaintiffs were not the real parties in interest and had no capacity to sue. This hardly seems open for debate. Admittedly the organizations named were voluntary associations. They are not legal entities and in Kentucky they cannot properly sue or be sued as such. Nichols v. Bardwell Lodge, No. 179, I. O. O. F., 105 Ky. 168, 48 S.W. 426, 6 Am.Jur.2d, Associations and Clubs, section 15; 39 Am. Jur., Parties, section 46. (Legislation rectifying this deplorable situation is needed. See Clay, CR 4.04(4), Comment.)

Apparently counsel for the nominal plaintiffs realized there was a defect of parties because a motion was made to add three individuals as party plaintiffs and as representatives of the voluntary associations and their members. These individuals were officers of the “Odd Fellows Hall Association”, which was alleged to be the same organization as the association to whom the property was originally deeded. The trial court entered an order making them parties plaintiff as representatives of “Noah’s Dove Lodge #20” and “Odd Fellows Hall Association”. It seems obvious that since these persons were being made parties as representatives of a class under CR 23.01, they were representing the members of the organizations and the order adding their names as parties should have so provided. A peculiar twist in the case is that the judgment does not mention these individual party plaintiffs, who, plaintiffs’ counsel practically admits, are the only parties with the legal capacity to sue as representatives of a class. (Neither appellants nor appellees seem to be aware of the fact that the judgment does not include these essential parties.)

One of defendants’ principal contentions on this appeal (which has been their contention throughout) is that the plaintiffs are not the real parties in interest and had no legal capacity to sue. This contention is well founded with respect to the two named voluntary associations. Their contention that the court improperly permitted the three individual plaintiffs to intervene is not well taken. They did not intervene under CR 24, but were added as party plaintiffs in a representative capacity in a class action under CR 23.01. As representatives of the members of the owning organizations, they would be the real parties in interest and would have the capacity to prosecute this suit. As heretofore noted, however, the judgment is not in their names. The judgment for “Noah’s Dove Lodge #20” is not a proper judgment and must be reformed for this, if no other reason.

The defendants maintain that there was no proof that the individual plaintiffs were members of the association to whom the property originally was deeded (“Odd Fellows Hall of Newport, Kentucky”). However, in our opinion the record established a sufficient interrelation between that association and the other-named associations of which the individual plaintiffs admittedly were members, to justify treating the individual plaintiffs as trustee representatives of the members of the title-holding association. At the very least, the evidence showed that the individual plaintiffs were members of the association that was in actual possessory control of the property.

Defendants contend the court should have allowed each of the two defendants three peremptory challenges. There is no merit in this contention because their interests were not antagonistic. See Roberts v. Taylor, Ky., 339 S.W.2d 653.

It is next contended the courf erred in admitting opinion evidence of unqualified witnesses as to the market value' of the Odd Fellows Hall. (It ranged up to $125,000.) This testimony by the individual plaintiffs was incompetent on two' grounds. The building was damaged, not destroyed. The measure of damages is the cost of repairs to restore the property to its original condition (where it reasonably may be done). Ben Gorham & Co. v. Carter, 228 Ky. 214, 14 S.W.2d 749. The market value of the property was irrelevant. In addition, we do not think these plaintiffs, as representatives of a class, could be classified as owners of this real estate so as to qualify them to testify with respect to the market value in the absence of any other qualifications. See Barron v. Phelps, Ky., 238 S.W.2d 1016; Hipp-Green Lumber Corporation v. Potter, Ky., 271 S.W.2d 892; Commonwealth v. Fister, Ky., 373 S.W.2d 720, (this day decided).

However, this testimony could not have been prejudicial. The jury verdict was $10,000 less than the cost of repairs estimated by the only witness qualified to testify with respect thereto. In their brief defendants admit the jury must have disregarded the market value testimony.

Defendants’ contentions with respect to a directed verdict and a judgment notwithstanding the verdict pertain to the matter of parties which we have heretofore discussed. The contentions with respect to the instructions cannot be considered because defendants failed to present these questions to the trial court as required by CR 51. Other contentions we find without merit.

We find no prejudicial error committed during the trial of this action. As wé observed at the outset, however, the' judgment is in favor of a fictitious party rather than the representatives of the true owners and possessors of the damaged property.

The judgment is reversed with directions to re-enter it in favor of the individual plaintiffs as representatives of and trustees for the members of the voluntary association which owned the property.


author: MONTGOMERY, Judge.

text:
    FOLEY CONSTRUCTION COMPANY, a Corporation, et al., Appellants, v. Henry WARD, Commissioner of the Department of Highways, etc., et al., Appellees.
    Court of Appeals of Kentucky.
    Oct. 25, 1963.
    Rehearing Denied March 6, 1964.
    Robin Griffin, Miller, Griffin & Marks, Lexington, for appellants.
    Donald Moloney, Lexington, John B. Breckinridge, Atty. Gen., William A. Lam-kin, Jr., Asst. Atty. Gen., James J. Shannon, Jr., Frankfort, for appellees.
   MONTGOMERY, Judge.

The decisive question is: May the Department of Highways, an agency of the state, defeat an action for damages for breach of a contract by the plea of sovereign immunity?

Foley Construction Company, a corporation, and Harry D. Foley, doing business as Foley Construction Company, sued Henry Ward, Commissioner, and the Department of Highways of the Commonwealth of Kentucky for $1,197,046.33 as damages for the breach of a contract to construct 3.S8S miles of grade and drain work on Interstate Highway 75 in Covington. The bid price of the contract was $5,695,881, all of which has been paid except $1,000. This sum has been withheld by the Department pending a release under the contract. Interest is claimed on both amounts sought. An appeal has been taken from a judgment in favor of the Department. The Department has cross-appealed from the ruling denying it the defense of sovereign immunity. Other questions are presented but are not decided.

The doctrine of sovereign immunity has always been embodied in the common law of the United States and of the individual states. The original concept often stated as “The king can do no wrong” arose out of the feudal dogma of divine right of kings and their infallibility. The authority of the king was considered absolute.

Redress for injuries from the crown suffered by a subject was sought by petition to the king. The petition was granted as a matter of grace. If the petition was properly presented, the usual way was for the king to endorse or underwrite “foit droit fait al partie” (let right be done to the party). 1 Blackstone’s Commentaries, Page 203. In all cases it appears that some endorsement or order of the king himself was necessary to warrant further proceeding.

Originally, claims for money if successfully presented were satisfied from the king’s personal funds. Later, as the king became dependent on the ordinary support of the government, it became necessary for Parliament to provide funds for the redress of such wrongs or payment of the claim. Thus arose the present principle in which the assent of the Legislature is required in order to sue the state. Chisholm Ex’r v. Georgia, 2 Dall. 419, 2 U.S. 419, 1 L.Ed. 440.

Immunity from suit is a sovereign right of the state. Sovereign rights are deemed essential to the existence of the state. The right of eminent domain, that is, the right of the sovereignty to use property of its members for the public good or necessity, is another sovereign right. Gilmer v. Limepoint, 18 Cal. 229. Sovereign rights are the supreme, absolute power to govern, which are possessed and exercised by both the United States and the individual states.

The right of sovereign immunity in Kentucky has existed from the beginning of the Commonwealth. Article VIII, Section 4, 1792 Kentucky Constitution provides: “The legislature shall direct by law in what manner and what courts suits may be brought against the Commonwealth.” With minor variations this principle has been embodied in each of the succeeding Constitutions. Article VI, Section 6, 1799 Kentucky Constitution; Article VIII, Section 6, 1850 Kentucky Constitution; and Section 231, 1891 Kentucky Constitution.

Deitzman, J., stated the purpose of the provision to be:

“The reason for exempting a municipality or sovereign from damages for injuries inflicted in the performance of its governmental functions is one of public policy to protect public funds and public property. Taxes are raised for certain specific governmental purposes, and, if they could be diverted to the payment of damage claims, the more important work of government, which every municipality or sovereign must perform, regardless of its other relations, would be seriously impaired, if not totally destroyed. The reason for the exemption is sound and unob-j ectionable.” ■ x

Taylor v. Westerfield, 233 Ky. 619, 26 S.W.2d 557, 69 A.L.R. 482.

Kentucky Constitution Section 230 complements Section 231. It contains prohibitions against withdrawal of money from the State Treasury and against the diversion of highway money from the purposes intended. In this regard both sections are intended to promote an orderly system for the disposition of public money.

The immunity of the sovereign from suit has long been recognized. In Tate v. Salmon, 79 Ky. 540, 3 Ky.Law Rep. 359, Lewis, C. J., wrote:

“It has been repeatedly decided by this court that, in the absence of a law au~. thorizing it, the state cannot he made a party-defendant or garnishee, and is not suable in her own courts; ‘that parties will not be allowed to evade this inhibition by ignoring the state in their suits, and proceeding directly against the public officer having the custody of the moneys sought to be reached.’ (Divine v. Harvie, 7 [T.B.] Mon. [439], 440; Tracy v. Hornbuckle, 8 Bush, 336; Rodman v. Musselman, 12 Bush, 336 [354].)”

Originally, the right to sue the state was obtained by a joint resolution enacted by the Legislature. Commonwealth v. Haly, 106 Ky. 716, 51 S.W. 430, 21 Ky.Law Rep. 666; Commonwealth v. Lyon, 24 Ky.Law Rep. 1747, 72 S.W. 323; Carroll v. Bosworth, 151 Ky. 337, 151 S.W. 916. Later the Legislature by a series of enactments provided the Board of Claims as the means by which certain claims against the state might be prosecuted. Throughout the litigation involving this method of procedure, the doctrine of sovereign immunity has been recognized. The Board of Claims method so provided was recognized as a legislative waiver of the right of sovereign immunity. See Morrison v. Department of Highways, Ky., 252 S.W.2d 426; Bach v. Bach, Ky., 288 S.W.2d 52; Commonwealth v. McCoun, Ky., 313 S.W.2d 585. In the Bach case, Sims, J., said:

“Under § 231 of the Kentucky Constitution, no one can sue the State without its consent, which is usually given by a joint resolution of the General Assembly. Carr v. Jefferson County, 275 Ky. 685, 122 S.W.2d 482.”

While appellants point to V. T. C. Lines, Incorporated, v. City of Harlan, Ky., 313 S.W.2d 573, as an expression of the discontent of the “majority of the court” with the rule, there is little significance in such claim. In Commonwealth v. McCoun, Ky., 313 S.W.2d 585, sovereign immunity and legislative waiver of the doctrine were exhaustively considered shortly after the V. T. C. Lines case. Nowhere in the lengthy majority and minority opinions in the Mc-Coun case is there to be found any suggestion that the sovereign immunity of the state should be removed except by legislative enactment. Petitions for rehearing were considered in both cases and denied the same day, June 20, 1958.

The doctrine has remained sacred and inviolate until recently. Appellants rely mainly on Watkins, Consulting Engineer v. Department of Highways, Ky., 290 S.W.2d 28, and Derby Road Building Company v. Commonwealth, Ky., 317 S.W.2d 891, as affording a breach in the doctrine. Humphreys v. J. B. Michael Company, Ky., 341 S.W.2d 229, is also cited.

It should be remembered that appellants have been paid the bid price of the contract, $5,695,881, except $1,000. By this suit they seek to recover damages for an alleged breach of the contract. The redress they seek arises from the failure of 'employees and/or officials of the Department to perform properly their duly authorized statutory duties. Typical of the omissions and delinquencies was the premature issuance of a work order by the then Commissioner or someone for whose failure he was responsible.

In this respect the present case is distinguishable from the Watkins case. At issue in the Watkins case was the question whether an arbitration agreement could be enforced to determine the amount of compensation to be paid an engineering firm for its services which were made necessary by added specifications under a contract with the Department. Such claim was for compensation for services performed pursuant to the contract rather than by reason of any breach of a contract.

While recognizing the immunity of the state from suit in the Watkins case, it was decided that the claim should be sustained as arising out of the performance of a legal ■contract under proper statutory authority. Appellants do not contend that there is any direct statutory authority to pay damages for breach of a contract

After having sustained the arbitration agreement to determine the amount of the claim, the Court in the Watkins case, in what amounts to dictum, suggested that the agreement might be sustained on the basis of mutuality of contractual obligation. An authorization to sue or be sued was implied from the statute which authorized the Department to enter into a contract. In this, appellants take comfort.

This implication is doubly wrong. First, Section 231 of the Kentucky Constitution and the cases decided thereunder are very specific in saying that: “The General Assembly may, by law, direct in what manner and in what courts suits may be brought against the Commonwealth,” thus leaving no room to imply that a suit may be brought. The detailed method of procedure for presenting claims against the state prior to the existence of the Board of Claims is an example of the legislative action which had been considered necessary.

Secondly, mutuality of obligations does not require that there shall be mutuality of remedies. It has been pointed out that this is true. The following from Cor-bin on Contracts, Volume 1, Section 146, pages 635-638, illustrates:

. “The law of contract is not limited to agreements that create reciprocal legal duties. * * * ”
“ * * * There are some notable exceptions to the stated rule, if it really exists, in which one party may be bound by his promise even though the other party is not. It is difficult to find any support for the supposed rule, other • than mere dicta of judges and writers, made perhaps with nothing but ‘illusory’ promises in mind.”

After pointing out several common exceptions, such as a bilateral contract by an adult and an infant, Corbin says:

“The promises of a sovereign government, including those of the United States and of the individual States, cannot be enforced in the courts unless there is definite legislation authorizing such action. The fact that the promise of the government is unenforceable does not render it an insufficient consideration for the promise of the other party to the contract.”

This rule was followed in University of Maryland v. Maas, 173 Md. 554, 197 A. 123, wherein it was held that the university, like other state governmental agencies, is immune from suit for breach of a building contract in the absence of legislation to the contrary. In Lohr v. Upper Potomac River Commission, 180 Md. 584, 26 A.2d 547, it was held that the state agency was not liable in a tort case even though the Act under which it was created expressly provided for suits by and against it. The Maryland Court held that authority “to sue and be sued” did not constitute a waiver of immunity from suit and that the immunity of a state can be invoked whenever a creature of the state is performing some governmental function.

The Supreme Court of California, on March 20, 1963, held that the unrestricted power of the state to impair its contract obligation by a plea of sovereign immunity did not render the contract illusory. Metropolitan Water District of Southern California v. Marquardt, Cal., 28 Cal.Rptr. 724, 379 P.2d 28. It was pointed out that such case is one of many exceptions to the rule that a bilateral contract not binding on one party is illusory, citing Restatement, Contracts, Sections 80, 84(e); 1 Corbin on Contracts (1950) Section 146, pages 465-468; 1 Williston on Contracts (3d ed. 1957) Section 105, pages 414-419.

The Court also said:

“ * * * a contract does not lack mutuality where the promise of one of the parties is unenforceable or voidable because of ‘a special privilege not ex- ■ pressly reserved in the promise but given by the law.’ Well-known examples of such exceptions are voidable contracts of infants and insane persons. Of particular significance is illustration 8 of section 84 of the Restatement, which reads: ‘A makes a bilateral agreement with the United States Government. The promise of the Government though unenforceable is not, because of that, insufficient consideration for A’s promise.’ (See also 1 Corbin, supra, p. 468.) A similar exception must be recognized here.”

Accordingly, it is concluded that in the Watkins case the discussion of mutuality of contractual obligation was and is erroneous dictum. Appellants’ reliance thereon has made necessary a lengthy discussion herein to disclose the error.

The Watkins case affords no authority to support a suit for damages based on breach of contract against the state or its Department of Highways. The Court having so concluded, it necessarily follows that the other leg on which appellants seek to stand, Derby Road Building Company v. Commonwealth, Ky., 317 S.W.2d 891, must likewise fold.

The decision in the Derby case was based on the mutuality obligation dictum in the Watkins case; hence, the holding in the Derby case is wrong, and that case is overruled on this point. Thus is illustrated the danger of dictum.

The allowance of suits for damages such as this one would create havoc and confusion in the operation of the Department of Highways. The Department’s highway construction program is much dependent on long range planning. Much of this program must be well coordinated in order to realize the most from federal funds available. The ordinary maintenance and construction of highways with unmatched federal funds would suffer most since sound fiscal policy would require the matching of all available federal funds. It would not take many suits of the caliber of this one to disrupt the orderly planning -and operation of the Department. The wisdom of this sound public policy, as heretofore expressed by Deitzman, J., is obvious.

In view of the constitutional provision, the sound public policy in support of it, and the long adherence by this Court to the principle of sovereign immunity, the plea on behalf of the appellees was a proper defense to the action, including the demand for the $1,000. While much of the discussion herein has been directed toward actions for damages, what has been said is equally applicable to actions on a contract. The demand for the final $1,000 due under the contract falls in this category.

The review of the cases on sovereign immunity forces the conclusion that such cases as the Watkins and Michael cases and the cases cited therein, in so far as they have permitted the state to be sued on a contract or for damages without express legislative consent, are unsound. To reiterate, the constitutional section in question has always been very explicit. The word “may” in Section 231 indicates that suits against the Commonwealth may be brought as a matter of legislative grace. Commonwealth v. Chevis, 4 Ky.Law Rep. 892. Only by authority of an enactment of the Legislature may such suit be brought, and then the manner of bringing a suit and the court in which it may be brought must be directed. To the extent that the cases mentioned are inconsistent herewith, they are overruled. This view renders it unnecessary to consider any other questions presented.

So far as appellants’ right to the $1,000 is concerned, no hesitancy is felt in saying that the appellees will doubtless honor it as well as the amount already paid under the contract.

Judgment on appeal is affirmed and on cross-appeal is reversed to sustain appellees’ plea of sovereign immunity as a defense.

MOREMEN, J., dissents.


author: ALEX P. HUMPHREY, Special Commissioner.

text:
    Samuel CARLICK et al., Appellants, v. John W. KEILER, II, Trustee, etc., et al., Appellees.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.
    Samuel Carlick, Joseph S. Freeland, Paducah, for appellants.
    Herbert Schultzman, Terrell, Schultzman & Hardy, James G. Wheeler, Wheeler & Marshall, Paducah, for appellees.
    Alvin L. Prichard, Sr., Kenneth L. Anderson, Woodward, Hobson & Fulton, Louisville, for appellee, Emanie Arling.
   ALEX P. HUMPHREY, Special Commissioner.

This suit grew out of an accounting of trustees under the will of Joseph L. Friedman who died in 1913. It is here on the appeal of the guardians ad litem representing several infant cestuis. The testator provided that the residue of his estate “be converted into good, interest-bearing securities which shall be turned over by my executors to the * * * trustee.” The trustees have invested in preferred and common stocks of corporations as well as bonds and debentures. Over the period of the trust, the estate increased in value from $500,000 to approximately $2,000,000.

The trial court approved the investments heretofore made by the trustees and construed the administrative directions of the will as meaning to include common and preferred stocks, bonds, debentures, rights, and similar sound investments from which prudent businessmen would expect to obtain reasonable returns and which would be regarded as proper and safe investments for a trust fund such as the one here in question.

The single issue on this appeal is whether, as contended by the appellant guardians ad litem, the trust should be limited to bonds and debentures under the terms of the will of the settlor.

In the paragraph of the will setting up the trust the testator’s intent was summarized in a final sentence:

" * * * It being my purpose to create an estate in the hands of the trustee * * * the income from which shall go to my mother and my three sisters as long as my mother lives and at her death to my three sisters as long as they live and in the event of the death of either one of them her interest shall go to her children.”

From the entire paragraph concerning the trust we find that the settlor’s intent was to provide income for his mother and sisters during their life, which necessarily involved the preservation of the value of the principal so as to produce that income.

The will was drawn in 1908, but of course speaks from the time of the settlor’s death in 1913. At that time the accepted method of prudent investors in providing a.working fund of long duration was to invest in high-grade bonds at a fixed rate of interest. Such was thought to be the most efficient prevention of a depreciation inasmuch as the bonds and interest were a claim of priority upon the assets of the debtor and not dependent on its profits susceptible to fluctuation. The theory was sustained by the relative stability of the dollar. Twenty years after the death of the settlor the United States went off the gold standard, and just prior to World War II the effects of inflation began to be felt. Its progress has been apparent. To assure a comparative income as well as to preserve the comparative value of a capital fund, the contemporary prudent investor, as were the trustees of this fund, seeks recognized stocks paying dividends from the corporate profits whose values will float with the inflationary tide rather than bonds of a value and interest rate forever pegged as of the time of their issue. See In re Trusteeship Under Agreement with Mayo, 259 Minn. 91, 105 N.W.2d 900.

The terms of the will are plain to indicate that the settlor contemplated trust investments of his estate in the form of bonds and debentures, but he could not anticipate the progressive inflation which has occurred and its adverse effect upon his plan of providing security for the beneficiaries should his directions now be literally' followed.

The Court’s jurisdiction to enforce trusts should and does include the power to vary the details of administration which the settlor has prescribed, in order to secure the more important result, namely, to obtain for the beneficiaries the advantages which the settlor stated he wished them to have. In this case the limitation of investments to bonds and debentures would frustrate the settlor’s main objective of providing a comfortable income to the objects of his concern. Security Trust Co. v. Mahoney, 307 Ky. 661, 212 S.W.2d 115; Bogert, Trusts and Trustees, section 561. (2d Ed. 1960)

It is our opinion that the Chancellor was correct in approving the investments made by these trustees insofar as the issues here involved, and to allow the continued investment in common and preferred stocks and rights, as well as in bonds and debentures.

We recommend that the judgment of the Court below be affirmed.

The opinion is approved by the Court and the judgment is affirmed.


author: WILLIAMS, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Sudie HOWARD, Appellee.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.

      John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., Frankfort, Phillip K. Wicker, Somerset, for appellant.
    Julian H. Golden, Pineville, for appellee.
   WILLIAMS, Judge.

In the Bell Circuit Court the appellee Sudie Howard was awarded $6,500 for .46 acre of land condemned by appellant. The judgment is attacked on two grounds: (1) The verdict is excessive and based on naked opinions of witnesses as to values rather than on statements of fact; (2) reversible error was committed when the circuit court refused to permit the Commonwealth’s witnesses to testify concerning sale prices of comparable properties.

The landowner’s witnesses possessed the necessary qualifications to testify concerning the value of the land taken. The evidence given by them was competent, although some of it was most questionable. The same was true in Commonwealth, Department of Highways, v. Fister, Ky., 373 S.W.2d 720. See also Commonwealth, Department of Highways v. Tyree, Ky., 365 S.W.2d 472. We do not decide the question of whether the verdict is excessive because the case must be sent back for a new trial on another ground.

The Commonwealth’s witnesses were permitted to describe comparable property in the vicinity which had been sold within a reasonable time of the taking. The trial court did not permit the witnesses to state to the jury the amounts paid for the properties described. Testimony as to amounts paid was taken by way of avowal. In Commonwealth, Department of Highways, v. Slusher, Ky., 371 S.W.2d 851, we had before us a similar question which concerned property located on the same road involved in this case. We held it was error to refuse testimony concerning the comparable sales. In like manner it was prejudicial error in this case to reject testimony concerning prices paid in comparable sales.

The judgment is reversed.


author: WADDILL, Commissioner.

text:
    Earl V. POWELL, Commissioner, Department of Economic Security, Appellant, v. Beatrice CUPP, Appellee.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.

      Paul E. Tierney, Forest Smith, Dept, of Economic Security, Frankfort, for appellant.
    John J. Tribell, Middlesboro, for appellee.
   WADDILL, Commissioner.

The appeal is from a judgment of the Bell Circuit Court declaring that appellee is eligible to receive grants of aid for her children under KRS, Chapter 205. The Department of Economic Security had discontinued previous grants of aid and had rejected appellee’s reapplication for assistance on July 18, 1960 on the ground that “incapacity to perform gainful employment had not been established for her husband, Leland Cupp.” This decision was upheld by the appeal board following a review provided by KRS 205.230(1, 2). However the Bell Circuit Court reversed the decision, and the Commissioner of Economic Security has taken an appeal to this Court.

The question presented for review is whether the Department and the appeal board erred in determining that Leland Cupp, the breadwinning parent, did not have a physical or mental impairment which prevented him from engaging in any useful or gainful occupation. KRS 205.010(5).

At the time of the hearing by the Department, Leland Cupp was 34 years of age, his right leg had been amputated below the knee and he was having some difficulty in using the prosthesis which had been furnished to him by the Department. Medical examinations disclosed that Cupp had developed a duodenal ulcer which was causing nausea and vomiting at certain times. It was also shown that Cupp has subsequently been gainfully employed to perform manual labor. Certain medical reports would justify a finding that Cupp was limited in the kind of employment he could engage in, yet his subsequent employment record shows that his physical impairments do not prevent him from performing some kinds of work. Under similar circumstances we have held that the Department was justified in concluding that the statutory requirement of incapacity had not been established. Barnes v. Turner, Ky., 280 S.W.2d 185; Barnes v. Noble, Ky., 280 S.W.2d 188; Barnes v. Riley, Ky., 280 S.W.2d 188.

Since the finding that Cupp was not incapacitated is warranted by the record, the circuit court should have upheld the appeal board’s disposition of the case.

The judgment is reversed with directions to enter a new one upholding the decision of the Department of Economic Security and the appeal board.


author: DAVIS, Commissioner.

text:
    Michael FREDERICK, by and through His Next Friend, John Frederick, Appellant, v. Audrey HALL, Appellee.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.

      Frank G. Gilliam, Lexington, Robert L. Milby, London, for appellant.
    G. L. Tucker, Cynthiana, Milton M. Bloom, Cincinnati, Ohio, for appellee.
   DAVIS, Commissioner.

Between 5 :30 and 6:00 p. m. on February 9, 1959, Michael Frederick, a child 2½ years old, was struck by the automobile of ap-pellee, Audrey Hall, on Locust Street in Cynthiana. In a suit prosecuted by Michael, through his father as next friend, a directed verdict denying recovery was rendered. This appeal seeks to reverse the adverse judgment entered pursuant to that directed verdict, asserting: (1) the facts warrant submission of the issues to a jury, and (2) new trial should have been granted pursuant to CR 63.

There was no stenographic report of the evidence at the trial, hence we have no detailed record of the evidence. Appellant submitted a narrative statement of the evidence as prescribed in CR 75.13. Appel-lee filed no specific objection to the narrative submitted by appellant, but countered with a narrative of her own, which differs in some material respects from the statement submitted by appellant.

The presiding judge at the jury trial was the late Honorable A. H. Barker. Judge Barker sustained the motion for directed verdict at the conclusion of all the evidence. Appropriate motion for new trial was timely filed and pending before Judge Barker when he died. Honorable John P. Lair succeeded Judge Barker as presiding judge of the Harrison Circuit Court, in which the action was pending. Appellant filed a second motion for new trial before Judge Lair, asserting entitlement to new trial because of the death of Judge Barker. See CR 63. The motions for new trial were overruled after careful consideration by Judge Lair.

Locust Street in Cynthiana runs in a north-south direction, and is available for two-way traffic. Little Michael had accompanied his mother in her visit to the home of a relative situated at 106 Locust Street. The boy’s father came to the area in a snub-nosed “potato chip” truck; parked it on the east side of the street at a point opposite 106 Locust, and sounded his horn to alert his wife that he had arrived for the purpose of driving her and the child home. Mrs. Frederick found it necessary to let go of Michael’s hand in order to close the door of the residence at 106 Locust. Thereupon Michael proceeded to “run” or “trot” toward his father as the father remained in the truck across Locust Street. Before Michael reached his father’s truck he was struck by the passenger car operated northwardly on Locust Street by Mrs. Audrey Hall, appellee.

Locust Street’s paved surface is 26.8 feet in width at the point of the accident. The point of the impact was eighteen feet from the west curb of Locust Street, and about 184 feet north of Pike Street (which intersects Locust at right angles). It was “getting dark,” but was not quite dark. There had been some rain, and the street was wet in spots, but it was not raining at the moment of the unfortunate incident.

Appellee testified that she did not see Michael until he was just two or three feet from her. She said that Michael emerged suddenly from the rear of a car parked on the west side of Locust Street, approximately opposite the site of the father’s truck. Appellee testified that she was traveling at twenty miles per hour just before the collision, and that as soon as she saw the child she applied her brakes and stopped within two car lengths. Other evidence (as contained in the narrative statements) is to the effect that appellee’s car traveled 125 feet beyond the point of impact.

The record reflects that a pavement led from 106 Locust to the curb, and that the father’s truck was parked nearly opposite that pavement. There is a critical conflict in the evidence as to whether there were one or two vehicles parked on the west side of Locust Street. Also, there is contrariety of evidence (as gleaned from the narratives) as to whether there was any vehicle located at a point south of the walk leading from 106 Locust to the curb. In this state of the record we hold that there was sufficient evidence to present a jury question as to whether Michael came from behind a vehicle into the path of appellee’s car. This view, of course, contemplates the existence of these discrepancies in evidence upon a new trial.

In reaching this conclusion we start with the premise that Michael Frederick, aged 2(4, is incapable of contributory negligence. See Ward v. Music, Ky., 257 S.W.2d 516, and Lehman v. Patterson, 298 Ky. 360, 182 S.W.2d 897.

We are buttressed with the principle that motorists are charged with taking into account the known proclivities ■ of small children, and that among those proclivities is the disposition to run or dart into a street. Cf. Roselle v. Bingham, 242 Ky. 496, 46 S.W.2d 784, and Lehman v. Patterson, supra.

To reach the point in Locust Street where he was struck, Michael traversed eighteen feet of the traveled portion of that street. If the southernmost car parked on the west side of Locust was indeed north of the walk leading from 106 Locust, there was nothing to prevent appellee’s clear vision of him during all of that eighteen feet of travel. In Bright v. McAllister, 310 Ky. 512, 221 S.W.2d 67, we recognized the physical fact that such a small child could never attain a running speed in excess of five miles per hour. Some of the narrative evidence in the record admits of 25 mph as a possible speed for appellee. If we construe the evidence most favorably to the plaintiff, we are constrained to the view that the case is one for the jury. See these cases: Bright v. McAllister, supra; Roselle v. Bingham, supra; Lehman v. Patterson, supra; Davis’ Adm’x v. Gordon, 309 Ky. 121, 216 S.W.2d 409; United Fuel Gas Co. v. Friend’s Adm’x, Ky., 270 S.W.2d 946; Kiser v. Justice, Ky., 336 S.W.2d 32; Baker v. Sizemore, Ky., 338 S.W.2d 386; and University of Ky. v. Guynn, Ky., 372 S.W.2d 414.

This conclusion is reached because the evidence warrants a jury to believe that appellee could have seen Michael engaged upon his childish dash to reach his father in ample time to avoid striking him. Her own testimony that she saw the child when he was two or three feet from her warrants a jury’s belief that she was not maintaining that degree of lookout required of an ordinarily prudent person under similar circumstances.

We have considered the cases cited by appellee, and find them distinguishable on their facts from the case at bar. It would extend this opinion beyond reasonable limits to undertake a detailed analysis of each case. It suffices to observe that we feel that the case before us is not controlled, on the facts, by: Louisville Taxicab and Transfer Co. v. Warren, 305 Ky. 861, 205 S.W.2d 695; Louisville & N. R. Co. v. Welsh, 272 Ky. 120, 113 S.W.2d 879; Lambert v. Miller’s Adm’r, 277 Ky. 64, 125 S.W.2d 1019; and Davis v. Bennett’s Adm’r, 289 Ky. 516, 159 S.W.2d 39.

What we have written makes it unnecessary to decide whether a reversal could have been granted pursuant to CR 63.

The judgment is reversed with directions to grant a new trial to the appellant and for proceedings consistent with this opinion.

      . As we must on the motion for directed verdict. Cf. Combs v. Peoples Bank, 313 Ky. 120, 230 S.W.2d 475.


author: MILLIKEN, Chief Justice.

text:
    Marvin Earl BENNETT, Appellant, v. PEABODY COAL COMPANY et al., Appellees.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.
    Laurence T. Gordon (Franklin & Gordon), Madisonville, for appellant.
    James M. Graves, Louisville, for appellee.
   MILLIKEN, Chief Justice.

This is an appeal from a judgment affirming the refusal of the Workmen’s Compensation Board to grant the appellant compensation for a claimed disability.

Appellant had been employed as a coal miner by appellee for over thirty-five years when he was trapped for a period of 41 ½ hours by a mine cave-in on May 29, 1959. It is admitted that he suffered no physical injury during the cave-in and his resulting entrapment. In fact, he worked for ten months thereafter. However, over a year later, on July 14, 1960, he sought disability benefits for claustrophobia, a neurotic condition, high blood pressure and inability to control his kidneys, all of which he attributed to the shock of the entrapment.

The Board based its determination on KRS 342,005 which requires that a personal injury be “traumatic” to be compensable. Appellant argues that this requirement has been abrogated by our holding in Grimes v. Goodlett and Adams, Ky., 345 S.W.2d 47, involving death by exertion. In the instant case, appellant’s claim is based solely on an alleged “mental or nervous condition resulting from his experience in being trapped.” As recently as 1962 we stated: “In order to be compensable, a neurotic condition must be the natural and direct result of a traumatic injury.” Martin v. Porcelain Metals Corporation, Ky., 358 S.W.2d 485, and cases cited. However, we are not faced with a clear-cut issue as to whether the appellant’s claimed condition could be considered compensable from a legal standpoint as being the result of a “traumatic” injury, for the Board found that “this entire record does not show that this plaintiff (appellant) sustained the injury alleged * and the Board was justified in so concluding. Since the Board’s finding that appellant suffered no such injury and had evidence to support it, it will not be disturbed by this Court.

The judgment is affirmed.


author: PALMORE, Judge.

text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Russell E. BRUBAKER et al., Appellees.
    Court of Appeals of Kentucky.
    Feb. 7, 1964.
    John B. Breckinridge, Atty. Gen., William A. Lamkin, Jr., Asst. Atty. Gen., Reed Anderson, Paducah, Dept, of Highways, for appellant
    E. W. Rivers, Paducah, for appellees.
   PALMORE, Judge.

On motion made and granted pursuant to KRS 21.060(2) the Commonwealth appeals from a judgment entered on a verdict awarding the appellees $2,538 in a land condemnation case.

The first complaint is that the three ■ persons who served as commissioners to fix the damages in county court, appearing as witnesses for the landowners at the trial in circuit court, testified to the amount they awarded in county court. Such testimony is, of course, incompetent as evidence in chief, but we need not consider either its competence or possibility of prejudicial effect in this case, because there was neither an objection nor any motion to exclude it.

The only other contention is that the trial court should have excluded much of the valuation testimony given in behalf of the landowners because it did not have sufficient factual support.

Before the taking the land in question was part of a 4.4-acre tract located on the south side of Kentucky Highway 95 in the area of the Calvert City industrial complex in Marshall County. It was purchased by the Brubakers in 1957 for $5,000. In this proceeding the highway department took a one-acre strip from the west side of the property, extending almost at right angles from highway 95 and cutting off a small triangular lot of about ½ acres. According to Mr. Brubaker this was the highest and best part, and the remainder would require extensive filling, costing perhaps $4,000, to make it commercially usable.

The witness J. B. Conn, one of the county court commissioners, was engaged in the lumber business in Calvert City. He said that he bought and sold real estate in developing land and was of the opinion that the Brubaker property had a market value of $5,000 to $6,000 before the taking and $2,500 afterward. He ascribed this seemingly disproportionate diminution to the fact that the portion taken was the heart of the property, being the only part suitable for a light industrial or business location.

Another of the county court commissioners, Fred Saltsgiver, a resident of Calvert City since 1925, testified that he had bought and sold real estate in the immediate area and “knew what other people were selling their property for along there.” His opinion was that the Brubaker tract was worth $5,000 before the taking and that the portion condemned had a fair cash value of $2,500. He said the property left after the taking “wasn’t worth much.”

The third member of the county court commission, Coleman Riley, was a real estate broker from Benton, the county seat. It was his opinion that the 4.4 acres had a fair cash value of $6,000 and that the value •of the portion taken was $2,500. As in the case of the other witnesses for the Bru-bakers, he said the portion taken was the ^highest and best ground.

Robert Arnold, a witness engaged in the real estate business in the Calvert City area, testified that property in the vicinity had appreciated in value between the time the Brubakers bought the 4.4 acres in 1957 and the time of the taking in late 1959, and that in his opinion the tract had a market value of $6,000 when the taking occurred and $3,000 afterward. He said, “The best part was taken and the poor part was left.” As in the instance of other witnesses, he pointed out that the land left would require extensive filling.

The real burden of the Commonwealth’s challenge against the landowners’ valuation evidence is that it did not rest on comparable sales. This is an oft-recurring argument which we have answered in several recent decisions handed down since the earlier cases, such as this one, were briefed. Under the principles set forth in Commonwealth, Dept. of Highways v. Tyree, Ky., 365 S.W.2d 472 (1963), there can be no real question as to the competency and sufficiency of the testimony questioned in this case.

We need not consider the probative weight of opinion testimony given by the owner Brubaker. With respect to its competence, hence its vulnerability on a motion to strike and admonish, it clearly was admissible at the time of this trial even if it should be conceded that it might be otherwise since Commonwealth, Dept. of Highways v. Fister, Ky., 373 S.W.2d 720 (mandate issued January 29, 1964).

By way of discrediting some of the testimony given by the Commonwealth’s appraisers concerning at least one comparable sale, the witness Arnold testified that part of the consideration lay in the fact that the buyer and seller, both industries, used each other’s products. Upon learning through cross-examination that the witness did not know this as a fact, counsel moved that the testimony be stricken. The motion was overruled, and we think this was error, but we cannot believe the testimony, as thus impeached, could have had any substantial or prejudicial effect upon the jury.

The judgment is affirmed.

      . $38 of this amount was for a temporary casement.