author: PHILLIPS, Chief Justice.

text:
    Basil H. TAYLOR, as Guardian Ad Litem and Next Friend for Lee E. Nagle, an insane person, Appellant, v. Olga R. NAGLE, Appellee.
    No. 11469.
    Court of Civil Appeals of Texas. Austin.
    March 1, 1967.

      Jeff Davis, San Antonio, for appellant.
    William H. Borchers, H. A. Triesch, New Braunfels, for appellee.
   PHILLIPS, Chief Justice.

Olga R. Nagle, the plaintiff below and the appellee here, filed contempt charges on behalf of herself and her children against her former husband Lee E. Nagle. Through criminal proceedings instituted against Lee Nagle by appellee, Nagle was extradicted from Oklahoma to Texas.

On returning to Texas in May of 1964 in the custody of the sheriff of Comal County, Texas, a hearing on the sanity of Lee Nagle was held in the District Court of Comal County where a jury found him to be insane and he was ordered placed in the State Hospital in San Antonio until such time as he should be found sane, at which time he was to be returned to Comal County to stand trial on the criminal charges.

A short time prior to the hearing on the sanity of Lee Nagle, appellee filed a contempt charge in the original divorce action.

Appellant, Basil H. Taylor, as Guardian ad litem and next friend, filed a motion to modify child support provisions on behalf of Nagle in the original divorce action in the District Court of Comal County, Texas.

Upon the filing of such motion, appellee filed a second charge of contempt against Lee Nagle.

At a hearing, appellant’s motion to modify child support provisions was overruled. At the same time the court permitted ap-pellee to abandon the second charge of contempt filed against Lee Nagle but found him guilty of contempt of court in the cause filed in the original divorce action.

It is from this judgment overruling appellant’s motion to reduce child support provisions and the judgment of contempt rendered against Lee Nagle that appellant has perfected his appeal to this Court.

We reverse and remand that part of the judgment overruling appellant’s motion to reduce child support payments. We dismiss appellant’s appeal from judgment of contempt.

Appellant is before this Court on thirty five points of error. Points one through eleven are briefed together, the first four points being the error of the trial court in overruling motion of next friend to reduce child support payments; in finding that there was no change of circumstances in the earning capacity or income of Lee Nagle, an insane person; in finding Lee E. Nagle, an insane person, had sufficient income at the time of trial with which to pay child support in the sum of $250.00 each month as previously ordered by the court, when there was no evidence to support such finding; when there was insufficient evidence to support the latter finding.

We sustain these points.

At the time .of the divorce in question, 1960, Nagle was a Captain in the United States Air Force receiving a salary in the neighborhood of $700.00 per month. Nagle is presently in the State Hospital in San Antonio having been adjudged insane. From the record before us it is fairly evident that Nagle has severed his connection with the Air Force and has little or no income. Consequently, we sustain this appeal on the motion to reduce payments and remand the case to the trial court for further action consistent with this opinion.

Appellant’s points of error five through nine complain of the admission of certain evidence. Should the admission have been error, and we do not pass upon this point, such error was harmless under the view we take here. Tex.R.Civ.P. 434.

Appellant’s remaining points of error twelve through thirty five are either restatements of prior points, discussed above, or pertain to error ascribed to the proceedings relating to and the judgment of contempt entered in this proceeding.

We strike these points and refer to ap-pellee’s motion discussed below.

In this State there is no right to a review by appeal or writ of error, statutory or otherwise, from an adjudication and commitment for contempt. 12 Tex.Jur.2d, Contempt, Sec. 57, and the cases there cited. The only remedy to review a contempt proceeding and the judgment therein is by a collateral attack by a writ of habeas corpus when the relator is in custody. On habeas corpus, the inquiry is to whether the court had jurisdiction to adjudge the contempt. 12 Tex.Jur.2d, Contempt, Sec. 59.

Consequently, we sustain appellee’s two motions, one, to dismiss appellant’s appeal from judgment of contempt, the other to strike from appellant’s brief appellant’s points of error Nos. XII through XXXV.

Reversed and remanded in part and dismissed in part.


source: Caselaw Access Project

author: WERLEIN, Justice.

license: Public Domain

text:
    James L. TRAHAN, Appellant, v. FEDERAL SIGN COMPANY OF TEXAS, etc., Appellee.
    No. 14989.
    Court of Civil Appeals of Texas. Houston.
    Feb. 23, 1967.

      Powell, Tucker & Kain, Richard L. Reedy, Houston, for appellant.
    Ross, Banks, May & Cron, Don W. Graul, Houston, for appellee.
   WERLEIN, Justice.

This suit was brought by appellee, Federal Sign Company of Texas, a division of Federal Sign & Signal Corporation, against appellant, James L. Trahan, to recover upon a written contract for liquidated damages and attorney’s fees, which appellee alleged were owing under the terms of such contract for furnishing, installing and maintaining three specific signs, designated in the trial court as Signs Nos. 1, 2 and 3. The court rendered judgment in favor of appellee and against appellant in the sum of $778.73 plus attorney’s fees in the sum of $150.00, or in the aggregate amount of $928.73.

The jury found that appellee’s delay in erecting Sign No. 1 was a failure to use due diligence in furnishing and installing such sign. The jury also found, however, that the delay by appellee in installing Sign No. 1 until April, 1963, was the result of appellant’s failure to obtain or provide a place for installation. The rule is well settled that there may be a recovery on the contract for part performance of an entire contract if complete performance has been prevented by the other party. 17 Am.Jur.2d, p. 826, Contracts, Sec. 382, and authorities there cited.

To Special Issue No. 3 the jury found that appellee failed to maintain Sign No. 2. Special Issue No. 4 reads: “From a preponderance of the evidence, what amount of money, if any, do you find will compensate the Defendant for the damages sustained as a result of Plaintiff’s failure to maintain Sign No. 2?” The jury answered, “None”. To Special Issue No. 5 the jury found that appellee had not failed to maintain Sign No. 3. Appellant did not object or except to the court’s charge or to any of the special issues submitted by the court. Neither appellant nor appellee requested any additional issues or objected to the charge on the ground there were any omitted issues which should be submitted.

Appellant complains that the court erred in entering judgment for appellee on the basis of the written contract and in not entering judgment for the appellant since the jury’s answer to Special Issue No. 3, that appellee failed to maintain one of the signs, barred appellee from recovery on the contract. Appellant further asserts that the trial court erred in not entering judgment for him on the jury verdict because the jury’s answer to Special Issue No. 3 was a finding that appellee only partially performed the contract and hence any recovery would have to be based upon quantum meruit and appellee did not plead or seek to recover in quantum meruit.

The case is before us without a statement of facts and without any findings of fact or conclusions of the trial court other than the statement of the court in its judgment that the court found that appellant was indebted to appellee in the sum of $778.73, with reasonable attorney’s fees of $150.00, to bear interest at the rate of 6% per annum from November 30, 1963. The law is well settled that in the absence of a statement of facts it must be presumed that sufficient evidence was introduced to support the findings of the jury and the judgment of the court. Lane v. Fair Stores, 1951, 150 Tex. 566, 243 S.W.2d 683; Schweizer v. Adcock, 1946, 145 Tex. 64, 194 S.W.2d 549; Houston Fire & Casualty Insurance Company v. Walker, Tex.Sup., 152 Tex. 503, 260 S.W.2d 600; 3 Tex.Jur.2d 703, and authorities there cited.

In the absence of a statement of facts, we must presume there was undisputed evidence showing that the amount due plaintiff as liquidated damages was as found and decreed by the court. Appellant has no point of error with respect to the amount so found by the court but merely complains that there could be no recovery on the contract in view of the jury’s finding that appellee failed to maintain Sign No. 2. The jury found that such failure did not result in any damages to appellant. In support of the court’s judgment, and in the absence of a statement of facts, we must presume that the evidence was undisputed that the default in payment by appellant preceded any default on the part of appellee.

Appellee pleaded a good cause of action for breach of contract and for liquidated damages resulting from appellant’s breach of contract consisting of failure to make payments as required under the terms of the contract. Appellant pleaded that he be allowed all lawful offsets and credits and damages against any judgment rendered against him. He failed to establish that he was entitled to any offsets, credits or damages.

Judgment affirmed.


author: DAVIS, Commissioner.

text:
    F. M. ASHBY, By and Through his Committee, J. C. Robinson, Appellant, v. John Stanley MARSH, Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.
    Rhodes Bratcher, Bratcher, Rummage, Beard & Flaherty, Owensboro, for appellant.
    Ben T. Cooper, Louisville, for appellee.
   DAVIS, Commissioner.

This is a second appeal in the same litigation; the opinion in the first appeal is found in Marsh v. Ashby, Ky., 381 S.W.2d 628. Reference is had to the first opinion for a fuli statement of the facts at issue. It is to be observed that we wrote in the first opinion: “In this case there does not appear to be any probative evidence that the insurer arbitrarily withheld its consent to the destruction of the animal.”

Pursuant to the remand for new trial additional evidence was presented in behalf of appellant, and submitted to the trial judge without the intervention of a jury. No evidence was offered for the appellee, representative of the insurance company. When the trial judge had considered the additional evidence offered, together with the evidence offered at the first trial, he found as fact “ * * * that with the additional evidence in the record, there does not appear to be any probative evidence that the insurer arbitrarily withheld its consent to the destruction of the animal ‘Real Country’.”

We have read carefully the new evidence offered and considered it in connection with the evidence adduced at the first trial, and we are unable to find that the factual finding of the trial judge is clearly erroneous. CR 52.01.

Appellant calls to our attention Cochran’s Adm’x v. Cochran, 273 Ky. 1, 115 S.W.2d 376, and Equitable Life Assur. Soc. of United States v. Witten, 265 Ky. 448, 97 S.W.2d 17. It is urged that the rationale of those decisions suffices to sustain appellant’s contention that he met the burden of proof. The principle relied upon is substantially stated in Headnote 2, Ibid., 97 S.W.2d 17:

“Where party in whose interest it would be to produce evidence within his control fails to do so, there is an inference that such evidence would he unfavorable to him.”

The difficulty is that there is nothing in this record to suggest that the insurance company failed to produce evidence in its control. At best, the insurance company was cast in the role of proving a negative, i. e., that it had not arbitrarily withheld its consent to the destruction of the horse. The affirmative burden of proof was on the appellant, and he has failed to sustain that burden so as to convince the fact finder. We may not reverse the judgment in such a case.

The judgment is affirmed.

All concur.


author: CULLEN, Commissioner.

text:
    Charles PETERS, Appellant, v. RADCLIFF READY MIX CONCRETE INC., et al., Appellees. Jerry MILLER, Appellant, v. THOMAS J. NOLAN & SONS et al., Appellees.
    Court of Appeals of Kentucky.
    March 17, 1967.
    Paul M. Lewis, Hatcher & Lewis, Elizabethtown, for appellant, Charles Peters.
    E. R. Gregory, Bowling Green, for appellant, Jerry Miller.
    Robert Hubbard, Elizabethtown, John Hopkins, Hazelrigg & Cox, Frankfort, for appellee, Radcliff Ready Mix Concrete, Inc.

      William A. Miller, Louisville, for appel-lee, Schabb Const. Co., Inc.
    William Mellor, Burke & Mellor, Louisville, for appellee, Thomas J. Nolan & Sons.
    L. A. Faurest, Faurest & Collier, Eliza-bethtown, Grover C. Thompson, Thompson & Thompson, Lexington, for appellee, Kentucky Steel Products Co., Inc.
   CULLEN, Commissioner.

Charles Peters and Jerry Miller, employes of Southern Plumbing and Heating Company, were injured while engaged in work for their employer in the construction of a new school building, when the roof collapsed. Schickli Contracting Company was the principal contractor on the job. Southern Plumbing and Heating Company, Radcliff Ready Mix Concrete Company, Schaab Construction Company, and Kentucky Steel Products Company all were subcontractors. Thomas J. Nolan & Sons were the architects.

The principal contractor, the architects, and each of the subcontractors were operating under the Workmen’s Compensation Act. Peters and Miller were entitled to workmen’s compensation from their employer, Southern Plumbing and Heating Company, and Miller applied for and received such compensation. However, both Miller and Peters filed common law actions against the subcontractors other than their employer, and against the architects, alleging negligence and seeking damages according to the common law. See KRS 342.055. Summary judgments were entered for the defendants, on the theory that under the law of Kentucky, as set forth in Miller v. Scott, Ky., 339 S.W.2d 941, an employe covered by workmen’s compensation cannot maintain a common law action for damages for injuries sustained on a job against anyone else directly connected with the performance of the job. Miller and Peters have appealed.

In Miller v. Scott, Ky., 339 S.W.2d 941, the holding was that an employe covered by workmen’s compensation who is injured by the negligence of a fellow employe working on the same job cannot sue the latter for common law damages. The holding was rested solely on the pronouncement in McEvilly v. L. E. Myers Co., 211 Ky. 31, 276 S.W. 1068, that “some other person than the employer,” as used in KRS 342.055 with reference to the bringing of common law actions, “refers to a third party having no connection with the general work being performed, and whose act of negligence was wholly disconnected with that work.” The specific holding in McEvilly was that an employe of a subcontractor could not sue the principal contractor for common law damages.

We think that the specific holdings in McEvilly and in Miller (v. Scott) may be justifiable but that the statement above quoted from McEvilly needs qualification and it should not be interpreted and applied to extend immunity from common-law liability beyond the limits deducible from Mc-Evilly and Miller.

The only immunity from common-law liability expressly provided for in the Workmen’s Compensation Act is that of the “employer”. KRS 342.015(1). Consistent with this are the provisions of KRS 342.055 relating to common-law actions against “some other person than the employer.” The immunity avoids unconstitutionality only on the basis that the employe, in electing to come under workmen’s compensation, waives his common-law rights against his employer. See Greene v. Caldwell, 170 Ky. 571, 186 S.W. 648.

In subcontractor situations it may be reasonable to treat the superior contractor as being the equivalent of an immune “employer” of the subcontractor’s employes by reason of his liability to them under KRS 342.060 for workmen’s compensation. The opinion in Jennings v. Vincent’s Adm’x, 284 Ky. 614, 145 S.W.2d 537, makes it clear that the superior contractor’s immunity arises solely from the existence of his statutory obligation for workmen’s compensation.

Perhaps immunity of an employe from common-law liability to a fellow employe working on the same job, as was held to exist in Miller v. Scott, can be justified on the theory that all employes of a single employer working on the same job constitute together with the employer an employment unit so integrated in economic effect as to warrant the entire unit as being considered to be embraced within the word “employer” as used in the immunity provision of KRS 342.015(1), thus extending the immunity to the employes. It reasonably could be considered that an employe would expect his workmen’s compensation benefits to be exclusive of any other remedy for injuries received as a result of negligence of any member of his employment unit.

There is no basis, however, on which one contractor can be considered to be an “employer” of the employes of another independent contractor who is in no way subordinate to the former. The one has no obligation for workmen’s compensation to the employes of the other, so he cannot be considered the equivalent of an employer. And despite the fact that two subcontractors may be working on the same general project, and be under contract to the same principal contractor, it cannot reasonably be considered that they are so integrated as to warrant that they be treated as a single employment unit. We think an employe cannot reasonably be considered to have intended or expected to waive his common-law right of action against every person, individual or corporate, who happens to work on the same project on which his employer is engaged.

In Dillman v. John Diebold & Sons Stone Co., 241 Ky. 631, 44 S.W.2d 581, where the holding was that an employe of the principal contractor could maintain a common-law action against a subcontractor, this Court made it very clear that the subcontractor has no immunity from suit by employes of other contractors on the same j ob since they have no right of workmen’s compensation against him. The court said, 44 S.W.2d 583, that “we cannot construe the statute as taking away their right to sue and putting nothing in its place.”

It is our considered opinion that the statement in McEvilly to the effect that “employer” includes anyone having any “connection with the general work being performed” is far too broad. We think the meaning of “employer” cannot be extended to people who have none of an employer’s obligations (such as the principal contractor’s workmen’s compensation obligation to employes of a subcontractor) and who are not members of an integrated employment unit so that the employer’s immunity envelops them.

The prevailing general rule in other jurisdictions is that a subcontractor negligently causing injury to an employe of another subcontractor is liable in a common-law action. See 101 C.J.S. Workmen’s Compensation, § 985d(3), pp. 479, 480 ; 2 Larson, The Law of Workmen’s Compensation, sec. 72.32, p. 177; State ex rel. Menefee Const. Co. v. Curtis, Mo., 321 S.W.2d 713; Hardesty v. Alliance Plumbing & Heating Co., 114 U.S.App.D.C. 360, 316 F.2d 361 (applying Maryland law); Portman v. Hanman Bldg. Corp., 131 Misc. 168, 226 N.Y.S. 395; McVeigh v. Brewer, 182 Tenn. 683, 189 S.W.2d 812; Rota-Cone Oil Field Operating Co. v. Chamness, 197 Okl. 103, 168 P.2d 1007; Davison v. Martin K. Eby Construction Co., 169 Kan. 256, 218 P.2d 219.

Massachusetts and Florida take a contrary ’ view, based upon a so-called “umbrella” theory. 2 Larson, The Law of Workmen’s Compensation, sec. 72.32, pp. 177 to 179; Dresser v. New Hampshire Structural Steel Co., 296 Mass. 97, 4 N.E.2d 1012; Miami Roofing & Sheet Metal Co. v. Kindt, Fla., 48 So.2d 840. However, strange as it may seem, Florida permits an employe to sue his fellow employe even though their mutual employer carries workmen’s compensation coverage. See Frantz v. McBee Company, Fla., 77 So.2d 796. It appears that in Florida the immunity of a subcontractor from suit by an injured employe of another subcontractor really rests upon a specific statutory provision’ which states that workers engaged in “a common enterprise” shall be considered “statutory fellow servants,” thus enabling any contractor whose employe negligently injures the employe of another contractor to assert the old common-law defense of negligence of a fellow servant. This is not a matter of immunity from suit but of availability of a particular defense which normally would be effective to prevent recovery.

Minnesota, Oregon and Virginia also follow an “umbrella” or “common enterprise” doctrine under which subcontractors on a common project are exempt from common-law liability to each other’s employes, but in these states the doctrine is by virtue of express statutory provision. See 2 Larson, The Law of Workmen’s Compensation, secs. 72.32, 72.33, 72.34, pp. 177 to 181 (and 1966 Cumulative Supplement pp. 194 to 198).

In 1955, in Frantz v. McBee Company, Fla., 77 So.2d 796, the Florida Court said that its research had disclosed that except for those states in which there was a specific statutory -immunity, Massachusetts was the only state subscribing to the view that the carrying of workmen’s compensation coverage by an employer operates to grant immunity to his employes from suits between each other. After that, of course, Kentucky took the same view in Miller v. Scott, Ky., 339 S.W.2d 941. If there is any valid reason for this view it is not the same reason that is given for holding a subcontractor immune from suits by employes of another subcontractor. (As hereinbefore indicated, the reason given for the subcontractor’s immunity is that all of the employes on one project are “fellow servants” so the old common-law defense of negligence of a fellow servant is available. But at common law one fellow servant can sue another; the latter’s negligence may exonerate his employer but he himself has no exoneration.) So Miller v. Scott is no precedent or authority for subcontractor’s immunity.

Since Miller v. Scott is not controlling of the question here presented, and since we find no basis in the Kentucky Workmen’s Compensation Law for treating all workers on one project as “fellow -servants” so as to warrant an “umbrella” or “common enterprise” theory (we rejected such a theory in Dillman v. John Diebold & Sons Stone Co., 241 Ky. 631, 44 S.W.2d 581) it is our conclusion that the defendants in the instant action had no immunity from suit arising out of the availability of workmen’s compensation to the plaintiffs.

The summary judgments were granted solely on the ground of immunity. In the briefs a couple of other defenses possibly available to one or more of the defendants are discussed but we shall not consider them because they were not passed on by the trial court.

The judgments are reversed with directions for further proceedings in conformity with this opinion.

All concur.


author: HILL, Judge.

text:
    Henry G. ADAMS, Appellant, v. Lenola Angel ADAMS, Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.

      C. B. Upton, Williamsburg, Sutton & Martin, Corbin, for appellant.
    J. B. Johnson, J. B. Johnson, Jr., Wil-liamsburg, for appellee.
   HILL, Judge.

This is an appeal by the husband and a cross-appeal by the wife from a judgment granting the wife an absolute divorce, providing for a division of their property,, denying the husband’s claim for improvements on the wife’s land, and dismissing the husband’s plea for divorce. As ground for divorce, each party alleged cruel and inhuman treatment by the other under KRS 403.020.

Appellant, age 62, and appellee, age 63, were married May 1, 1954, and were separated February 26, 1964. It was appellant’s fourth marriage and appellee’s first. Appellant was a machinist for the L & N Railroad Company. Appellee worked at the Corbin, Kentucky, YMCA as a cook and resided on a 75-acre farm.

At the time of their marriage their individual net worths were about equal. When suit was filed, they had $4792.90 in the bank in their joint names; $2540 of this amount was attached by appellee at the commencement of her suit. The judgment appealed from gave appellee $2396.45.

During the period of their marriage, the parties both worked and earned money. They resided on and operated the farm, raised and sold cattle, and earned money in other farm activities. Appellant sold a house in Corbin for $5000; and he contends that out of this amount he satisfied a $1750 mortgage on the house sold, a $600 mortgage on the farm, and deposited the balance of the proceeds from the sale in their joint names.

Appellant sold the farm equipment acquired during the marriage for $1200, to which appellee made no claim. Appellant contends he spent $10,000 or $12,000 on improvements on the farm; appellee denies this.

In the absence of an accurate bookkeeping system, it is apparent it would be difficult to make a correct division of their property. But the chancellor adjudged Lenola was entitled to $2396.45, as indicated above, restored to appellee the one-half interest in the farm she had deeded to appellant early in their marriage, and adjudged appellant was entitled to the farm equipment not theretofore disposed of, including a truck. Taxed as cost was $500, allowed the attorney of appellee.

As indicated by the appeal and cross-appeal, neither party is satisfied with any part of the judgment except that ap-pellee was pleased with the divorce granted to her. Appellant contends he is entitled to recover $10,000 to $12,000 for improvements on the farm. Appellee contends she is entitled to a lump sum alimony.

The judgment appealed from does not describe the allowance of $2396.45 to ap-pellee as alimony, nor did it provide that the restoration to appellee of appellant’s one-half interest in the farm should be in lieu of alimony, but the net result is in the nature of a lump sum allowance. We think appellee is in no position to complain. She is much better off financially than she was the day she took the appellant to be her “lawfully wedded husband.”

Turning to appellant’s earnest argument that he is entitled to judgment for improvements placed on the farm, it must be first deduced from the evidence there was no agreement between the parties that appellant would be reimbursed the amount of the improvements, although the fact that the parties pooled their earnings and resources and the further fact that appellee deeded, through a third party, a one-half interest in the farm to appellant, to say the least, are convincing circumstances tending to establish a full and complete partnership of all their financial affairs. Even so, we do not believe appellant was entitled to recover the amount of the improvements for the two following reasons: First, appellant received the benefits from residing on the farm for nearly ten years and was thereby relieved of his lawful duty to provide a home for the family; and second, as noted above, the chancellor apparently was thinking in terms of alimony when he adjudged appellant not entitled to the improvements. See Bohannon v. Bohannon, Ky., 249 S.W.2d 544 (1952) and Sandusky v. Sandusky, 166 Ky. 472, 179 S.W. 415.

Appellant next assails the judgment allowing $500 to appellee’s attorney and cites McDonald v. McDonald, 279 Ky. 688, 132 S.W.2d 49, Bledsoe v. Bledsoe, Ky., 267 S.W.2d 933 (1954), and Sears v. Sears, Ky., 339 S.W.2d 453. Appellee counters with the argument that inasmuch as the attorney is not a party on appeal, the question is not reviewable and that it cannot be said from the evidence that the wife has “sufficient estate of her own.”

It was held in Carter v. Carter, Ky., 382 S.W.2d 400, and in many other cases, that the adequacy or inadequacy of counsel’s fee cannot be considered unless the attorney “to whom it is awarded is made, or makes himself, a party to the appeal.”

KRS 453.120 provides that “in actions for alimony and divorce, the husband shall pay the costs of each party, unless it appears in the action that the wife is in fault and has ample estate to pay the costs.” (Emphasis ours.) Both conditions fixed by the statute must exist. See Anderson v. Anderson, 310 Ky. 521, 221 S.W.2d 69 (1949). The judgment found appellant at fault, although it also found appellee was “not without fault.” It would be difficult indeed to find a faultless person. But we think the “fault” referred to in the statute means such fault as would justify granting a divorce. Before the wife may be denied recovery of her cost and attorney fees, she must be at fault equal to or greater than that of her husband.

We may not disturb the findings of the chancellor unless clearly erroneous. CR 52.01.

The judgment is affirmed on the direct as well as on the cross-appeal at the costs of appellant.

All concur.


text:
    HARTFORD FIRE INSURANCE COMPANY, Appellant, v. Ohoma MOORE et al., Appellees.
    Court of Appeals of Kentucky.
    March 17, 1967.

      Earle M. Nichols, Nichols & Nichols, Madisonville, for appellant.
    Carroll Morrow, Moore, Morrow & Fry-mire, Madisonville, for appellees.
   DAVIS, Commissioner.

The factual situation presented in this appeal is a nove one involving various rights under a fire insurance policy. In substance, the judgment of the trial court was adverse to the appellant, Hartford Fire Insurance Company, and by this appeal that company seeks a reversal of the judgment. A statement of the underlying facts is necessary to clarify the questions presented here.

Jewell Moore and Ohoma Moore, his wife, jointly owned a residence at Mortons Gap. On July 13, 1963, a fire insurance policy in the amount of $3,000 was issued by the appellant company, covering fire and other hazards respecting the property. The policy was a renewal of a policy obtained in 1959 through the vice president of Planters Bank, serving also as an insurance agent, incident to a mortgage loan of $2,000 made by that bank to the Moores. A standard mortgage clause in favor of the bank was made part of the policy.

A second mortgage loan was obtained by the Moores from Peoples Bank & Trust Company, Madisonville, and the latter bank was also designated as a payee under the mortgage clause in the insurance policy. It appears that the amount of the loan by the Peoples Bank to the Moores was originally in the sum of $1,516.53.

On April 17, 1964, a fire of undetermined origin virtually consumed the residence of the Moores. At that time Mr. and Mrs. Moore had separated, and by the time the present suit came to trial they had been divoi ced.

On the Saturday after the fire Jewell Moore advised his banker-insurance agent at the Planters Bank that the loss had occurred. Mr. Pendley, the banker-insurance agent, informed Moore that he would relay the information to the appellant company, which he did. Shortly thereafter the company referred the loss to the General Adjustment Bureau at Madisonville; Roger Davis, an employee of that bureau, undertook the investigation of the loss.

Davis went to the fire scene, but was not successful in locating Jewell Moore. However, Moore obtained the word that Davis desired to see him about the fire and called upon Davis in his Madisonville office. Davis obtained from Moore a non-waiver agreement, preserving the company’s policy rights while permitting its investigation of the fire. Davis requested Moore to furnish an appraisal of the loss, which Moore did furnish to Davis in a few days. Moore testified that he was then informed by Davis that nothing more was required, and that if he needed him for anything more he would let him know. Davis denied this.

Meanwhile, the domestic difficulties between Mr. and Mrs. Moore seem to have worsened, and in the settlement of their affairs Moore conveyed to her his undivided interest in the fire-damaged property. Mrs. Moore communicated with Davis on at leart three occasions;‘ she testified that she was pressing him for a settlement, but he denied that she did, although he admitted that she did call upon him asking about the status of the claim.

On December 15, 1964, the Planters Bank executed and delivered to Davis a sworn statement in proof of loss under the policy. Davis had prepared this proof of loss for the bank. Incident to that, the company paid Planters Bank $2,021.66, the exact sum due on the mortgage note of the Moores. The bank executed an assignment to the insurance company of all its rights in the note and mortgage.

Three days later Davis went through the same routine with Peoples Bank, by receiving from it a proof of loss which he had prepared, paying the bank $978.34 (balance of the policy’s $3,000 coverage), and taking an assignment, pro tanto, of that bank’s interest in the mortgage note of the Moores.

On April 22, 1965, the Moores instituted this suit, seeking to recover in behalf of Mrs. Moore the $3,000 claimed under the policy; the banks were named as defendants and called upon to assert their claims.

The insurance company defended on two basic grounds; (1) the Moores had failed to file a sworn statement of proof of loss within 60 days, and (2) the suit had not been filed within 12 months next after inception of the loss. The insurance company asserted a counterclaim against the Moores, seeking recovery of the sums paid by it to the banks, and enforcement of the mortgage liens.

The trial court submitted the issues to a jury, which returned a two-way verdict, by awarding recovery to the Moores for $3,000 on the policy, and awarding the insurance company $3,000 for the sums it had advanced to the banks. Except for a slight differential as to interest on the respective claims, the trial could be characterized as a “dog-fall.”

We think we can cut through the maze of legal arguments presented in the briefs. As we view it, it is not necessary to decide whether the suit was too late. In our view, the parties went to trial on the idea that the Moores had done all that was required of them by the policy, or, if not, that the company had effectively waived any noncompliance. The trial court permitted an amended complaint asserting waiver by the company’s actions; this amendment was filed after the proof was in, and purportedly to conform to the proof. Appellant complains that the pleading was not served, but that question was not preserved for appellate review, nor would it have been a valid point anyway in the circumstances at bar.

CR 15.02 specifically permits the type of amendment which was made in the trial court. Significantly the cited rule also provides that even the failure to so amend “ * * * does not affect the result of the trial of these issues.”

It is observed that the policy of insurance provides, in part:

“If the insured fails to render proof of loss such mortgagee, upon notice, shall render proof of loss in the form herein specified within sixty (60) days thereafter and shall be subject to the provisions hereof relating to appraisal and time of payment and of bringing suit. If this Company shall claim that no liability existed as to the mortgagor or owner, it shall, to the extent of payment of loss to the mortgagee, be subrogated to all the mortgagee’s rights of recovery, but without impairing mortgagee’s right to sue; or it may pay off the mortgage debt and require an assignment thereof and of the mortgage.” (Emphasis added.)

It is significant that the appellant company has never asserted that it claimed “that no liability existed as to the mortgagor or owner” at the time it accepted the proofs of loss from the banks and paid to them a sum equal to the proceeds of the policy. It must be recalled that the insurance company paid the money to the banks just less than eight months after the fire — certainly within twelve months after the inception of the loss by any construction. What then remained for the Moores to do? So far as they were then concerned, the insurance had been paid, so there was no purpose in their filing proof of loss. It seems obvious that what the Moores really sought in this action was to have the liens of the mortgages cleared from the title records. Their obligations to the banks had been credited, but the liens had not been released. They took the precaution of naming the banks as parties in the action, because it was obvious that any insurance proceeds would inure to the banks under the mortgage clause of the policy; on the other hand, if the insurance company was taking the position that it had merely bought the paper from the banks, then the Moores wanted credit to the extent of the insurance as a set off against the company.

As recently as Fidelity & Guaranty Ins. Underwriters, Inc. v. Gregory, Ky., 387 S.W.2d 287, this court had occasion to deal with the legal effect of the conduct of an adjuster (from the same bureau) as working an estoppel against the con-pany’s insistence upon policy provisions respecting proof of loss. The rationale of that decision is controlling here. It seems abundantly plain that the actions of the appellant company “would naturally induce delay or lead an ordinarily prudent person to believe that the requirement of the policy respecting proof was waived.” See Dunning v. Continental Ins. Co., 254 Ky. 368, 71 S.W.2d 995, 998, quoted with approval in the Gregory opinion. Moreover, by parity of reasoning, it is equally clear that an ordinarily prudent person would believe that the insurance company had “paid” the claim when it paid the exact amount of the policy to the banks. This is particularly so in face of the policy provision warranting subrogation in such instances if, but only if the company “shall claim that no liability existed as to the mortgagor or owner.”

Our cases have recognized the validity of policy provisions imposing limitation periods shorter than provided by statute. Burlew v. Fidelity & Casualty Co. of New York, 276 Ky. 132, 122 S.W.2d 990, 121 A.L.R. 751. It seems appropriate to observe that the same policy which allows the company to enforce the contract must require the company to abide by the contract. The company did not bring itself within the policy provisions for payment to the mortgagee banks while preserving its defenses, if any, against the mortgagor. It neglected to disclaim liability to the mortgagors. As observed in Cox v. Howard, Ky., 261 S.W.2d 673, 675: “all they that take the sword shall perish with the sword."

The judgment is affirmed.

All concur.


author: WILLIAMS, Chief Justice.

text:
    PERMALUM WINDOW & AWNING MFG. CO. et al., Appellants, v. PERMALUM WINDOW MFG. CORP., Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.

      Jack M. Lowery, Jr., Louisville, for appellants.
    Jerry A. Lloyd, Louisville, for appellee.
   WILLIAMS, Chief Justice.

Appellee Permalum Window Mfg. Corporation of New York (hereinafter referred to as New York) sued appellant Per-malum Window and Awning Manufacturing Company of Louisville (hereinafter referred to as Louisville) for $8,541.23 due on account. Louisville counterclaimed for $564.88 overpayment and for $10,000 damages for New York’s breach of contract.

In January 1961 New York’s factory was gutted by fire. They had orders that should be filled. Steinek, owner of 50 per cent of the stock, and secretary of the corporation, came to Kentucky and made an oral contract with Louisville whereby New York would furnish the raw materials and Louisville would produce storm windows to fill New York’s orders. Under the arrangement, at the end of a month the cost of the raw materials was to be balanced against the cost of the finished product to determine who owed any money on the mutual account. As an incentive New York was to give Louisville a 15 per cent discount on all extrusions used in the manufacture of New York’s orders. The cost of accessories was to be the base cost. Louisville was to pay common carrier charges F. O. B. New York and New York was to pay freight F. O. B. Louisville.

This business relationship continued until Louisville wrote New York that prices on the finished product must be raised in order for it to continue production. New York immediately discontinued relations for production purposes as of June 2, 1961.

As heretofore pointed out, New York sued for $8,541.23. At the trial both parties’ motions for directed verdicts were overruled. The trial court refused tendered instructions. Louisville objected. No instruction was given on Louisville’s counterclaim for $10,000 damages. The court instructed the jury to find for New York and credit Louisville as much as $4,271.56. The jury credited Louisville $3,041.23 and awarded New York $5,500.00. Louisville appeals.

The first issue before this court is whether the trial court properly directed a verdict for New York on the amount due. There are conflicts in evidence pertaining to amounts owed and credited each party. It appears before corrections were attempted that about $51,000 worth of material was used to produce $47,000 worth of windows.

One conflict is whether Louisville was to pay all freight charges F. O. B. New York at common carrier rate or only the freight charges for material sent by common carrier. New York shipped most materials to Louisville on its own truck. A second conflict is whether a New York employee who was sent to Louisville as a supervisor at a salary of $110 per week was to be paid by New York or Louisville. A third conflict is whether a $6,000 check paid to Louisville was persuasive compensation to continue production or a loan to finance the continuance of production debited against Louisville’s account. A fourth conflict is whether the numerous two to three-day delays in receipt of raw materials caused a reduced work schedule, stoppage and/or the necessity for overtime work.

New York contends that all freight charges F. O. B. New York were to be paid by Louisville at common carrier rate. Louisville contends that only common carrier charges were to be paid by Louisville. New York used a private truck to bring most of the raw materials to Louisville and on return trips the truck took finished windows to New York. Louisville did not consider this common carrier freight.

Zecca, an employee of New York before the fire, was sent to help Louisville in production techniques. New York charged Louisville’s account with Zecca’s salary for the nine weeks Zecca worked in Louisville —$990, or $110 per week. Zecca was paid by New York. New York only charged Louisville for the straight salary. New York paid the workmen’s compensation and other benefits. Louisville contended that New York was to pay Zecca and that it was not to be charged for Zecca’s salary.

The alleged loan of $6,000 that New York charged to Louisville’s account was made by check from New York. Louisville understood the check to be for Louisville’s agreement to continue production because otherwise New York would be in a bad position with its customers. Louisville contends this $6,000 should not be charged against its account. The only writings on the subject are the check (“on account”) and a note on New York’s book designating the check as a loan.

Louisville alleged that it couldn’t clear any profit if its employees had to' work overtime to make up for delays. On cross-examination Mr. Owsley, of Louisville, mentioned delay was also due to lack of glass. Zecca testified three or four delays were caused by lack of glass. Glass was an item Louisville was to supply. Furthermore, materials delivered from New York were not ordered by Louisville. New York merely anticipated Louisville’s needs.

New York corrected charges against and favoring both parties for raw materials.

Masonic Widows and Orphans Home v. City of Louisville, 309 Ky. 532, 217 S.W.2d 815 (1948), discusses a directed verdict as follows:

“ * * * (I)t is the essence of judicial power to determine whether or not a party has produced evidence which is sufficient in law to sustain judgment in his favor and to exercise that inherent power by directing a verdict where there is lack of proof supporting the material elements of the cause of action asserted. The proper exercise of that power does not impair or defeat the constitutional right to trial by jury. Slocum v. New York Life Ins. Co., 228 U.S. 364, 33 S.Ct. 523, 57 L.Ed. 879, Ann.Cas,1914D, 1029; Lyon v. Mutual Ben. Health & Accident Ass’n, 305 U.S. 484, 59 S.Ct. 297, 83 L.Ed. 303, rehearing denied in 306 U.S. 667, 59 S.Ct. 459, 83 L.Ed. 1062.”

The facts in the instant case are disputed. The balance due according to New York is not the same as Louisville’s balance. New York’s records were complete. Louisville never proved a balance due. The instructions directed a verdict for the amount of New York’s balance and limited jury consideration of factual conflicts to a determination of credits due Louisville up to $4,271.56. Under the circumstances that instruction was not erroneous.

A second contention is that New York failed to establish a prima facie case for debt by evidence showing sale and delivery of goods.

Louisville’s invoices represent the sale of the goods to it. The invoices were made in the ordinary course of business and were identified by the secretary of New York. The bulk goods were not returned but the finished product was sent to New York.

Under the facts this is a mutual account. It is not self-proving. Testimony is required to prove its correctness and that it is due and owing. 1 Am.Jur.2d, Accounts and Accounting, pp. 391-392. 1 Am.Jur.2d, at page 393, states how an account is proved:

“ * * * Ordinarily an account is proved by proving each item, including date, correctness of each item contained in the account, the charge made and the reasonableness thereof, and this is often done by introducing record testimony, consisting of the original book of entry with a showing that the entries were contemporaneously and correctly made with the transaction, or by oral testimony.”

New York proved its accounts by records made in the ordinary course of business and by oral testimony.

As for delivery, Louisville agreed to pay common carrier charges for shipment of raw materials from New York to Louisville. Thus Louisville was to receive the goods F. O. B. New York. New York agreed to pay charges for finished materials shipped to it. In fact, New York furnished a truck for freight purposes.

Louisville cites KRS 355.2 — 301, the Uniform Commercial Code, on General Obligations of Parties:

“The obligation of the seller is to transfer and deliver and that of the buyer is to accept and pay in.accordance with the contract.”

However, the comment explaining this section says:

“ * * * In order to determine what is ‘in accordance with the contract’ under this Article usage of trade, course of dealing and performance, and the general background of circumstances must be given due consideration in conjunction with the lay meaning of the words used to define the scope of the conditions and duties.”

The Uniform Commercial Code is more specific when it comes to delivery of F. O. B. shipments. KRS 355.2 — 504 is the key to the contention of no delivery in this case.

“Section 2.504. SHIPMENT BY SELLER
“(1) Where the seller is required or authorized to send the goods to the buyer and the contract does not require him to deliver them at a particlular destination, then unless otherwise agreed he must
“(a) put the goods in the possession of such a carrier and make such a contract for their transportation as may be reasonable having regard to the nature of the goods and other circumstances of the case; and
“(b) obtain and promptly deliver or tender in due form any document necessary to enable the buyer to obtain possession of the goods or otherwise required by the agreement or by usage of trade; and
“(c) promptly notify the buyer of the shipment. Failure to notify the buyer under paragraph (c) or to make a proper contract under paragraph (a) is a ground for rejection only if material delay or loss ensues.”

The comment following this section is pertinent.

“1. The section is limited to ‘shipment’ contracts as contrasted with ‘destination’ contracts, or contracts for delivery at the place where the goods are located. The general principles embodied in this section cover the special cases of F. O. B. point of shipment contracts and C. I. F. and C. & F. contracts. Under the preceding section .on manner of tender of delivery, due tender' by the seller requires that he comply with the requirements of this section in appropriate cases.”

Thus the parties had what is known as a shipment contract and delivery under it is not at the destination but at the point of departure. New York proved it shipped the goods and Louisville did not affirmatively plead they were not received. In our opinion New York fulfilled its duty and established a prima facie case of debt.

The final contention is that the trial court erred in refusing to submit an instruction on Louisville’s alleged $10,000 damages caused by New York’s delay in shipment and merchantability of materials shipped. When a counterclaim for damages is not proved, the trial court may refuse to submit an instruction on it.

Louisville counterclaimed that the raw materials it received were delayed and were of poor quality. It did not object to the quality on inspection or use of the goods. It accepted them. Objection came when the suit to collect for them was filed. Delay in objecting to the poor quality of goods is ground for estoppel in a suit for damages for unmerchantable material or material unfit for a particular purpose known to the vendor. Cogan v. Wall, 206 Ky. 89, 266 S.W. 884 (1924).

Furthermore, no evidence was presented to prove that the material was unmer-chantable and unfit for the particular purpose.

The judgment is affirmed.

All concur.


author: WADDILL, Commissioner.

text:
    Anna Marie JONES, Appellant, v. James B. JONES, Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.
    Cecil C. Wilson, Larry D. Garmon, Wilson, Baker & Herbert, Glasgow, for appellant.
    Henry H. Dickinson, Richardson, Barrickman & Dickinson, Glasgow, for appellee.
   WADDILL, Commissioner.

Anna Marie Jones filed this divorce action against James B. Jones on the ground of cruel and inhuman treatment. The trial court granted her a divorce; awarded her the household furnishings, lump sum alimony of $1,000 payable $50 per month, awarded her the custody of two teenage daughters and $100 per month support for them. She also received a house valued at $7500 and assumed the payment of a $5200 mortgage on it.

On this appeal Anna argues that the alimony award is inadequate and relies on Jones v. Jones, Ky., 382 S.W.2d 842, wherein we affirmed a lump sum award of $3000 alimony based on the income of the husband who had a negligible estate. It may be observed that in the cited case the wife had been a housekeeper all her life, was untrained and unskilled for gainful employment. The instant record does not disclose any present impairment in Anna’s health and affirmatively reveals that she has been regularly employed most of her adult life. Moreover, the opinion in Jones, supra, does not show that the wife was awarded any property or that the husband was paying child support.

Anna and James were married in 1946. They separated in 1963. Anna, age 43, is employed as a nurse and earns $140 per month while James, age 42, is employed as a state trooper and receives a net salary of $365 per month. The trial court found, as stipulated by the parties, that the net worth of their joint estate was $3831.

When the sum allowed as alimony is considered in isolation it does seem to be a meager allowance in view of the fact that the parties were married for approximately seventeen years. The fact of the matter is that James receives $365 a month take-home-pay, $100 of which has been committed to maintenance of his daughters. When the monthly alimony payment is made, James has only $215 left. Apparently the trial judge believed that $1000 as alimony, when considered in light of the $1200 worth of household furnishings plus the equity in the real estate of $2300 which Anna obtained in this proceeding, was an equitable allowance.

We are sympathetic with Anna’s plea of inadequacy of alimony. However, since she has been regularly employed as a nurse, is young and in good health, we are unwilling to hold that the trial judge abused his discretion.

The further contention, that the fee allowed appellant’s attorney is insufficient, is not properly before us because the complaining attorney has not prosecuted an appeal. Tyler v. Bryant, Ky., 394 S.W.2d 454; Dixon v. Dixon, Ky., 306 S.W.2d 879.

Under the circumstances appearing in this record we find no reversible error.

The judgment is affirmed.

All concur.


author: CLAY, Commissioner.

text:
    KENTUCKY WOMEN’S CHRISTIAN TEMPERANCE UNION, Appellant, v. Myra B. THOMAS et al., Appellees.
    Court of Appeals of Kentucky.
    March 17, 1967.
    William E. Allender, Duncan & Allender, Bowling Green, for appellant.
    B. G. Davidson, Bowling Green, for ap-pellees.
   CLAY, Commissioner.

Appellant owned a tract of land in Warren County. In a suit to sell the land, ap-pellees claimed title by virtue of adverse possession. This issue was submitted to a jury which found for appellees. On this appeal appellant’s only contention is that it was entitled to a directed verdict because the evidence was not sufficient to support the jury’s finding.

The property involved is rough, hilly land. The claims of the appellees are separate. Appellee Thomas was deeded approximately 100 acres in the tract by a former occupant in March 1948. Appellee Tabor was conveyed approximately 16 acres by the same grantor in July 1949. Since appellant held the superior record title, it was incumbent upon appellees to prove 15 years’ adverse possession prior to July 1964. (Their grantor did not possess the land at the times the deeds were made.) There is no evidence that any notice of the adverse claims was actually brought home to appellant.

It is well recognized that in order to acquire title by adverse possession it must be hostile, actual, open, notorious, exclusive and continuous for the required statutory period. Tartar v. Tucker, Ky., 280 S.W.2d 150. In the present case our problem centers on the question of whether appellees’ possession was sufficiently notorious, exclusive and continuous.

The proof for appellee Thomas was in substance that in 1948 she seeded and fertilized the ground to produce grass, and later some clearing was done by a bulldozer. Hay was cut off the land on the average of every other year, and at one time a corn crop was raised. In about 1956 a pond was dug. From 1959 to 1963 the land was placed in a soil bank. Though there was no cultivation, bushes were cut each year. In 1961 and 1962 appellee Thomas executed mineral leases but there was no development thereunder.

Notoriety, exclusiveness and continuity of possession are often evidenced by the erection of physical improvements on the property, such as fences, houses or other structures. We have none of those here. In their absence, substantial activity on the land is required. As said in Combs v. Ezell, 232 Ky. 602, 24 S.W.2d 301, 305:

“Adverse possession of land may be said to be founded in trespass; it must be a trespass constantly continued by acts on the premises. It must challenge the right of all the world; the claimant must keep his flag flying, and present a hostile front to all adverse pretentions.”

It has also been said that possession must be so continuous as to furnish a cause of action every day during the entire 15-year period. Noland v. Wise, Ky., 259 S.W.2d 46. While this principle perhaps should not be applied literally, it would rule out sporadic activity which would not bring home to the true owner reasonable notice of a continuing hostile claim of right. For this reason the occasional cutting of timber is generally held not to constitute an adverse holding. See Noland v. Wise, Ky., 259 S.W.2d 46, and cases cited therein.

While seasonal and substantial cultivation of the land every year possibly might be sufficiently notorious to create something in the nature of a constructive continuity, the activities of appellee Thomas on this land fall far short of that. Only one crop was raised. The cutting of hay and bushes were invasions of only brief duration. When the land was placed in a soil bank for four years it simply lay dormant. Cutting bushes during those years raised a very small and temporary flag to signal hostile possession.

In our opinion the use of this land by appellee Thomas was not sufficiently notorious, exclusive or continuous to create title by adverse possession.

With respect to appellee Tabor, who had purchased his acreage in July 1949, he did not begin his activities on the land until the following month. He did cut some weeds and sow some grass, and cut Canadian thistles every year. Occasionally he cut tier poles for tobacco, and hauled wood to burn a plant bed. He executed mineral leases in 1955 and 1962, but there was no development on the land.

His acts were less substantial than those of appellee Thomas. In addition, his adverse possession commenced at a time less than 15 years prior to the date he asserted his claim.

We believe the court erred in not directing a verdict for appellant as to the claims of both appellees Thomas and Tabor.

The judgment is reversed, with directions to enter judgment for appellant in accord with its motion for judgment notwithstanding the verdict.

All concur.


author: DAVIS, Commissioner. HILL, Judge.

text:
    Anna Frances EILERS (now Anna Anderson), Appellant, v. George F. EILERS, Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.
    James A. Crumlin, Louisville, Jack Greenberg, James M. Nabrit, III, Leroy D. Clark, New York City, Anthony G. Amsterdam, Philadelphia, Pa., for appellant.
    James A. Hubbs, Louisville, for appellee.
   DAVIS, Commissioner.

For the third time we have before us litigation involving a child custody struggle between the divorced parents of five children. The most recent phase of the matter was dealt with in Eilers v. Carpenter, Ky., 406 S.W.2d 830. An earlier appeal wherein the mother-appellant and the father-ap-pellee were parties was dismissed on January 14, 1966, because the appeal was not timely filed.

We have never reached the merits of the controversy, and we are not able to adjudicate the case upon the merits in the present appeal, for the reasons hereinafter set forth.

The trial court denied the appellant-mother’s prayer that she be awarded the custody of the children; the court awarded custody of all the children to the appellee-father.

In order to illustrate the reasons for our present holding we furnish an outline of the factual background involved. The appellant and appellee were married in 1950, and divorced June 14, 1963. They were the parents of five children, the oldest of whom is a girl, 14 years old at this time. The mother had the children at the time of the divorce although there was no formal judgment awarding her custody of them. The mother married Marshall Anderson, a Negro, in Chicago, Illinois, in January 1964. The mother and father, as well as the five children, are of the Caucasian race.

The father filed supplemental pleadings in the divorce action, on February 13, 1964, seeking custody of the children. By judgment entered September 29, 1964, the trial court denied the father’s request for custody, but removed the children from the mother’s custody; it was the court’s order that the children be placed in two Catholic homes for orphans in Louisville. However, the Catholic homes did not receive the children, whereupon the trial judge ordered that their custody be transferred to the Juvenile Court of Jefferson County. The Juvenile Court, on February 18, 1965, placed the two oldest children with the appellee-father and the three youngest with the appellant-mother. On February 25, 1965, the trial judge ordered that the five children be removed from the custody of their parents; the appeal of the mother from that order was dismissed by this court on January 14, 1966, as untimely filed. The children were placed in various homes by the Juvenile Court authorities pending the ultimate decision now on appeal.

In the course of the hearing which culminated in the judgment now under consideration, the attorneys for appellant undertook to inquire of a witness with respect to a letter which the witness had written to the trial judge and as to a response to the letter by the judge. The witness was the executive director of the Louisville and Jefferson County Children’s Home, to which the children had been committed. The trial judge refused to permit any interrogation about the letters, and specifically declined to permit them to be made part of the record by way of avowal. CR 43.10 relates to the avowal procedure, and directs that in actions tried by the court, without a jury, avowals shall be permitted “ * * * unless it clearly appears that the evidence is not admissible on any ground or that the witness is privileged.” The purpose of the rule is obvious. Absent the proffered testimony by avowal, a reviewing court has no means by which it may adjudicate the propriety of the ruling. It may not be said of the letters that they were inadmissible “on any ground,” nor is it suggested that any “privilege” of a witness was in issue. In a matter as delicate as the one at bar, we must regard this departure from authorized procedure as reversible error. Cf. Wells v. Wells, Ky., 406 S.W.2d 157.

In our view, the trial court erred in refusing to receive in evidence a tendered criminal record of the appellee. The basis for the court’s ruling was that the matters in the record had occurred prior to September 29, 1964, and therefore did not have relevance as to a change of conditions since that time. The difficulty with that position is that the appellee-father was found to be unfit in the September 1964 judgment; there really was no necessity for putting his record in evidence in the proceedings leading to the September 1964 order.

It is likewise true that the trial court should have received evidence offered by the appellant-mother respecting the appel-lee-father’s alleged abuse of the children during the time before the divorce. That phase of the matter had never been in real issue between the parties, and it is our view that the entire background of the domestic relations of these persons should be disclosed in order that all pertinent factors may be weighed in striking the balance of the equities of the case.

No reason appears which would warrant interference with the custody order from which this appeal was taken. That order shall remain in effect until further order of the trial court or any court of competent jurisdiction. All matters presented upon this appeal which are not disposed of herein are reserved.

The judgment is reversed for proceedings consistent with the opinion.

WILLIAMS, C. J., and MILLIKEN, MONTGOMERY, OSBORNE, PAL-MORE, and STEINFIELD, JJ., concur.

HILL, J., dissents.

HILL, Judge.

I respectfully dissent from the majority opinion in this child custody case.

This is the third time the custody of these five children has been presented to this court, and each time the court has shied away from the real issue and relied upon technicalities to avoid facing up to it. In the meantime, the children have been shifted from pillar to post, including the Jefferson County Children’s Home. They are growing up unsettled and without the stability of supervision. The parents of these children were divorced in June 1963. Appellant, the mother, was granted a divorce at that time on the ground of cruel and inhuman treatment. The divorce judgment found appellee, the father, “unfit” to have their custody and that the divorce was caused by his “failure * * * to properly care for his family.”

It is my opinion the mother has been deprived of her lawful right to her children solely on the fallacious argument that she has married a member of the Negro race. This is evident from the following statement by the trial court:

“The Court is compelled to take notice of the racial unrest prevalent at this time, and of the struggle on the part of the colored race for equality with the white race. Of course, we realize that this ‘equality’ is a relative word and we use the phrase merely to call attention to the fact that in rearing these children in a racially mixed atmosphere will per se indoctrinate them with a psychology of inferiority. We think that subjecting these children to such a hazard would be in negation of their ‘best interests.’ ” (Emphasis added.)

The record contains no evidence of unfitness insofar as the mother is concerned. Neither is there evidence that the present husband of appellant is unfit. There is some indication that he left some marks on some of the children in attempting to correct them, but such conduct does not render him unfit to have their joint custody along with their mother. On the contrary, this circumstance, to me, is evidence of fitness. The adage “spare the rod and spoil the child” may be old and outmoded, but it is, nevertheless, sound.

RCA 1.185 provides for advancing child custody cases. This rule is now in the process of amendment so that such cases will be advanced automatically and have preference over other litigation. The purpose of this rule will be thwarted if other unimportant technical rules of procedure are followed.

I would disregard technical consideration and expeditiously award the custody of the five children to their mother.


author: OSBORNE, Judge.

text:
    ILLINOIS CENTRAL RAILROAD, Appellant, v. Elro VINCENT, Appellee.
    Court of Appeals of Kentucky.
    March 17, 1967.
    Lively M. Wilson, Stites, Peabody & Helm, Louisville, for appellant.
    Benn Hanish, Hanish & Hanish, Louisville, for appellee.
   OSBORNE, Judge.

The appellee, Elro Vincent, brought this action against the Illinois Central Railroad company and Benny Jackson for the recovery of damages arising out of an automobile collision. The trial court directed a verdict against Jackson and submitted the question of the negligence of the Railroad to the jury, which awarded appellee $13,-429.30 against Jackson and $6,714.65 against the Railroad. Jackson has satisfied the judgment against him; the Railroad appeals.

On January 21, 1964, appellee was driving south on Cane Run Road in Jefferson County approaching a spur track of the Illinois Central Railroad at approximately four o’clock in the afternoon. The road was dry and the weather clear.

The company was operating a railroad motor-car on the spur track. This car is a small four-wheel vehicle propelled by a gasoline engine and is used to transport work crews to and from a job site. It has been designed so that it will not operate the signals that are placed at crossings to warn motorists of oncoming trains. As the ap-pellee approached from the north, he observed the railroad motor-car traveling east toward the intersection. Appellee testified:

“Q. Now, can you tell us generally the character of the area as far as where that track intersects?”
“A. Well, there is a little rise about two hundred feet before you get to the railroad crossing. But it was in January and there wasn’t no leaves to amount to anything. The stop was there, but you could see through it. I could see the motor-car, the signal light was not working and the flagman was by the side of the motor-car. He was not out there flagging traffic.”
“Q. Now, Mr. Vincent, as you approached the intersection of these railroad tracks as shown on the photograph, what rate of speed were you operating the vehicle?”
“A. From thirty to thirty-five miles an hour.”
“Q.' Now as you approached this track, about where were you when you. first observed a vehicle on the railroad track itself ?”
“A. I would say from fifty to sixty feet.”
“Q. And about how far west of the highway was this vehicle and what kind of vehicle was it, if you please?”
“A. It was a motor-car and it was about twenty to thirty feet from the intersection.”
“Q. And what did you do upon seeing that motor car?”
“A. I began to stop.”
“Q. Now, did you bring your car to a gradual stop or did you suddenly stop ?”
“A. It was a gradual stop.”

After the appellee stopped, his automobile was struck in the rear by an automobile driven by Benny Jackson. The impact knocked his car across the tracks. There was no collision between the Railroad motor-car and the appellee’s car. In addition to the damage to his automobile, appellee suffered a neck injury.

Jackson in his testimony stated that he was following the Vincent car at a distance of approximately two car lengths. As he approached the crossing he decided to light a cigarette and attempted to reach into his pocket to get it. When he looked up from his futile attempt, he saw the brake lights of Vincent’s car and immediately applied his brakes. However, he was too late and he struck the car knocking it across the tracks. William Burba testified that he saw Jackson apparently attempting to get a cigarette before he struck appellee’s car.

The Railroad contends that it was not guilty of any negligence that contributed to the cause of the accident. Three elements are necessary to support a negligence action. They have been stated in numerous opinions of this court, the last being Williams v. Ehman, Ky., 394 S.W.2d 905. There it was said: “The problem of what constitutes actionable negligence is clearly stated in Warfield Natural Gas Co. v. Allen, (1933) 248 Ky. 646, 59 S.W.2d 534, 91 A.L.R. 890: ‘Actionable negligence consists of a duty, a violation thereof, and consequent injury. The absence of any one of the three elements is fatal to the claim.’ See also Chesapeake and Ohio Ry. Co. v. Carmichael, (1944) 298 Ky. 769, 184 S.W.2d 91; Louisville & N. R. Co., v. Vaughn, (1942) 292 Ky. 120, 166 S.W.2d 43; Eaton v. Louisville & N. R. Co., et al., (1953) Ky., 259 S.W.2d 29; Leonard v. Enterprise Realty Co., (1920) 187 Ky. 578, 219 S.W. 1066, 10 A.L.R. 238.”

The common law duties of a railroad in the operation of its trains are to give an adequate warning of the approach of a train, keep a look-out ahead, and operate the train at a speed commensurate with the danger. Illinois Central Railroad Company v. Arms, Ky., 361 S.W.2d 506, citing Piersall’s Adm’s v. Chesapeake and Ohio Railroad Co., 180 Ky. 659, 203 S.W. 551. Since look-out and speed of the motor-car played absolutely no part in the cause of the collision between appellee’s and Jackson’s vehicles, the only possible basis of the railroad’s liability is inadequate warning and this was the issue submitted to the jury.

Appellee testified that he saw the track car traveling at a walking speed with the flagman alongside. He saw it in time to come to a complete but gradual stop from a speed of thirty to thirty-five miles per hour. Therefore, if the warning was inadequate (which we do not believe) it could not possibly have been the cause of this collision.

A superseding cause relieves the original negligent actor from liability irrespective of whether the antecedent negligence was or was not a substantial factor in bringing about the injury. Hines v. Westerfield, Ky., 254 S.W.2d 728. A superseding cause is an independent intervening cause. We are of the opinion that the failure of Jackson to maintain a proper lookout while he was searching for a cigarette was the sole cause of appellee’s injuries. Riley v. Burgess, Ky., 410 S.W.2d 712, rendered January 20, 1967.

The trial court allowed the safety and work rules of the railroad to be admitted into evidence. We agree that they should have been admitted. Rule 61 provided:

“61. Highway Traffic at Grade Crossings Must Be Given Preference. When approaching such crossings at grade or workmen on or near track, track car must be under complete control and stopped when necessary, and the employee in charge must know that the highway traveler or workmen will not be endangered before proceeding.”

It is our opinion that these rules do not set the standard of care that was given to the jury in the instructions. They are however admissible. Current v. Columbia Gas of Kentucky, Ky., 383 S.W.2d 139; Chesapeake and Ohio Railway Co. v. Biliter, Ky., —S.W.2d — rendered February 3, 1967. The foregoing grounds being sufficient for reversal, we will not discuss the other errors alleged by appellant.

The trial court should have sustained the motion for a directed verdict and having failed in this should have sustained the motion for judgment n. o. v.

The judgment is reversed.

All concur.


author: MONTGOMERY, Judge.

text:
    Paul K. WOOD et al., Appellants, v. BOARD OF EDUCATION OF DANVILLE, Kentucky et al., Appellees.
    Court of Appeals of Kentucky.
    March 17, 1967.
    James F. Clay, James F. Clay, Jr., Dan-ville, for appellants.
    Nelson D. Rodes, Jr., Pierce Lively, Dan-ville, for Board of Education of Danville.
    L. T. Grant, Lexington, William P. Swain, Boehl, Stopher, Graves & Deindoer-fer, Louisville, for Charles Renfro and others, members of and comprising the Board of Education of Danville.
    Robert Matthews, Atty. Gen., Joyce Ferris Nedde, Asst. Atty. Gen., Frankfort, for Commonwealth, Dept, of Education, and Kentucky State Board of Education, amici curiae.
   MONTGOMERY, Judge.

Paul K. Wood, suing individually and as the father and next friend of Kenneth Wood, an infant, and Joanne Wood, Kenneth’s mother, sought to recover damages for personal injuries to Kenneth. A claim was filed with the Board of Claims against the Board of Education of Danville, Kentucky, and the Commonwealth of Kentucky. The order of the Board of Claims dismissing the claim was sustained by the Boyle Circuit Court. Wood also sued the Board of Education of Danville, Kentucky, the members of the board individually, Chester Caddas, and Neal Clem. The actions were consolidated. Paul K. Wood et al., appeal from an order of dismissal of both actions as to all parties except Caddas and Clem. From the record no disposition of the action as to Caddas and Clem has been made. See CR 54.02(1).

In the original complaint it is alleged that Kenneth Wood, a student in the Danville Independent School District, suffered personal injuries while under the supervision of Chester Caddas, as “the agent, servant and employee of the Board of Education of Danville, Kentucky.” It is variously alleged that the injuries were the result of the negligence or willful conduct of Caddas, as agent, or by the willful conduct of Clem, on his own behalf or as agent for Caddas. The facts are very sparingly stated in the pleadings.

The action was properly dismissed as to the Board of Education of Danville, Kentucky, on the ground that the board of education was entitled to the defense of sovereign immunity. Cullinan v. Jefferson County, Ky., this day decided.

By an amended complaint it is sought to hold liable individually the members of the board on the theory that they employed Caddas and that he was their agent. A board of education is a body politic. KRS 160.160. Caddas was employed by the board and was not an employee of the individuals comprising the board.

The rule has been stated thus:

“The doctrine of respondeat superior is not applicable so as to render members of a school board personally liable for injuries caused by the negligence of employees, such employees being the servants of the school district or of the board, rather than of the individual members of the board.” See Annotation, 32 A.I..R.2d 1163.

In a similar case, Vendrell v. School District No. 26C, 226 Or. 263, 360 P.2d 282, the Oregon Supreme Court recently said:

“First it may be noted that the individual members of the school district board, the district superintendent, and the district principal do not stand in the relation of master and servant with persons subordinate to themselves; consequently the doctrine of respondeat superior cannot operate to impose vicarious liability upon these persons for the negligence of their subordinates.”

See also Smith v. Consolidated School District No. 2, Mo., 408 S.W.2d 50, wherein the school superintendent and physical education instructor were held not liable for injuries alleged to have been sustained by a student while engaged in wrestling as a part of the physical education curriculum.

This is in accord with Whitt v. Reed, Ky., 239 S.W.2d 489, and Moores v. Fayette County, Ky., this day decided. It is pointed out therein that the members of a fiscal court or a board of education are liable individually if they had been negligent in the first instance in the employment of the subordinates. There is no such allegation in appellants’ pleadings. The alternate charge of liability in the original complaint is one of willful conduct of Caddas, the subordinate, and of Clem. It is not alleged that Clem was an employee of the board, and certainly the individual board members would not be liable for willful conduct of a subordinate unless they knew of his propensity for such willful conduct when they employed him, thus rendering them negligent.

By their amended complaint appellants also seek to charge the members of the board individually on the theory that they were compelled by KRS 159.010 to place their child in attendance at the school and thus “in the care, control and custody” of the board members and “their agents, servants and employees.” For the reasons already noted herein, and also stated in Moores v. Fayette County, Ky., this is not a proper basis for a liability as to the board members individually.

The further allegation that there was a promise implied by the individual board members by reason of the statutory compulsory attendance of the child at school to “safely keep and protect said infant child and permit him to return to the home of the plaintiffs in good health, sound of body and mind, and without injury” would make the individual members of the board insurers of the welfare of all children required to attend school. It is too much to expect that anyone, board member or otherwise, should assume this responsibility, especially in view of the suggestion of injury because of the willful conduct on the part of someone else, as alleged in the original complaint. It is difficult enough to induce qualified and interested individuals to seek election and to assume the thankless task of school board member without making the board member assume the responsibility of an insurer of each child’s safety and well-being while attending school. Gilbert v. Harlan County Board of Education, Ky., 309 S.W.2d 771. It is unnecessary to discuss liability for failure to perform ministerial and discretionary acts.

Appellants also argue that Sections 2, 14, and 26 of the Kentucky Constitution afford a remedy for every injury and that Section 231 of the Kentucky Constitution should not bar such an action. Section 231 is no late-comer to the Kentucky Constitution. As has been pointed out heretofore, it has been in each of the four Constitutions of this Commonwealth in the same language. Certainly the makers of those time-honored documents intended Section 231, which has been interpreted as the doctrine of sovereign immunity, to have some meaning.

It is a cardinal rule of construction that the different sections of the Constitution shall be construed as a whole so as to harmonize the various provisions and not to produce a conflict between them. Matthews v. Allen, Ky., 360 S.W.2d 135; Grantz v. Grauman, Ky., 302 S.W.2d 364; Shamburger v. Duncan, Ky., 253 S.W.2d 388; City of Somerset v. Caylor, Ky., 241 S.W.2d 990.

The doctrine of sovereign immunity had acceptance in our system of jurisprudence before the adoption of our first Constitution. It was then embodied therein and it must be recognized that whatever may have been intended by Sections 2, 14, and 26 of the Kentucky Constitution, under which appellants seek redress, it was not intended that those sections should in any way impinge on the right of the Commonwealth by its General Assembly under Section 231 to direct in what manner and in what courts suits may be brought against it. Thus, it is concluded that effect must be given to Section 231.

No argument is made by appellants as to their right to pursue their claim before the Board of Claims except as above mentioned. Despite the language in Louisville & Jefferson County Metropolitan Sewer District v. Kirk, Ky., 390 S.W.2d 182, there is no right to pursue this claim in the Board of Claims for the reasons stated in Gnau v. Louisville & Jefferson County Metropolitan Sewer District, Ky., 346 S.W.2d 754.

The trial court correctly dismissed the actions.

Judgment affirmed.

WILLIAMS, C. J., MILLIKEN, OSBORNE, and STEINFELD, JJ., concur.

HILL and PALMORE, JJ., dissent for the reasons stated in Cullinan v. Jefferson County, Ky.


text:
    PUBLIC SERVICE COMMISSION of Kentucky, the Cities of Covington, Newport and Ludlow, Appellants, v. CITIZENS TELEPHONE COMPANY, Appellee.
    Court of Appeals of Kentucky.
    Nov. 23, 1966.
    As Modified on Denial of Rehearing March 24, 1967.
    As Amended March 30, 1967.
    Robert Matthews, Atty. Gen., J. Gardner' Ashcraft, Asst. Atty. Gen., Frankfort, Donald C. Wintersheimer, City Sol., Covington, Lawrence Riedinger, Special Counsel, Newport, Joseph A. Boone, City Atty., Ludlow, William J. Wise, Robert B. Halloran, Newport, Charles Graham, Dayton, George Muehlenkamp, Newport, for appellants.
    John J. O’Hara, O’Hara & Ruberg, Cov-ington, Charles G. Puchta, Earl R. Huffman, Frost & Jacobs, Cincinnati, Ohio, for appellee.
   CULLEN, Commissioner.

Citizens Telephone Company (hereinafter “Citizens”) applied to the Kentucky Public Service Commission (hereinafter “PSC”) for approval of a proposed increase of rates. PSC approved only part of the increase. Citizens appealed to the Franklin Circuit Court which found that the rate base fixed by the PSC was “unreasonably low” and that the rate of return allowed by PSC was so “unreasonably low” as to constitute a confiscation of property. The court entered judgment setting aside the PSC order and remanding the case for further proceedings in conformity with the court’s opinion. PSC and the cities of Covington, Newport and Ludlow, which had protested the proposed rate increases, have appealed from the judgment.

Citizens serves the large urban area of northern Kentucky which lies directly across the Ohio River from Cincinnati, this area being referred to in these proceedings as the “Metropolitan Area”. Citizens also has some outlying exchanges serving suburban and rural territory around the periphery of the Metropolitan Area. For convenience we shall refer to this as the “Suburban Area”. Historically, the rates in the Suburban Area have been lower than those in the Metropolitan Area.

Citizens is a wholly-owned subsidiary of Cincinnati and Suburban Bell Telephone Company (hereinafter “Cincinnati Bell”) which serves Cincinnati and its suburban areas in Ohio. Citizens owns no operating properties; everything it uses is leased from Cincinnati Bell. The two companies for years have provided the equivalent of a single-system service in the “Greater Cincinnati Area” consisting of Cincinnati and the Northern Kentucky Metropolitan Area. The rates have been the same on both sides of the river in this area, and patrons have been able to call anywhere in the Greater Cincinnati Area without toll. This has not been true, however, of the Kentucky Suburban Area.

In the instant proceedings Citizens sought an increase in its Suburban Area rates, its Kentucky intra-state toll rates, and its Metropolitan Area rates. PSC granted the first two but denied the third. PSC found that on an original cost basis Citizens had a rate base of $18,419,497, and on a capital structure basis had a rate base of $17,722,902. The increase in rates allowed by PSC would produce a rate of return of 5.49% on the original cost rate base, or 5.71% on the capital structure rate base.

As stated at the outset of this opinion, the circuit court found that the rate base fixed by PSC was “unreasonably low”. We shall examine first that finding.

PSC took the position that because of the interlocking of corporate entities, properties and services of Cincinnati Bell and Citizens it was impossible to physically separate and value the property used and useful in rendering Kentucky intrastate service; that some property located in Ohio was used in whole or in part in rendering the Kentucky service, and, similarly, some property located in Kentucky was used in part in rendering Ohio service; and that use of a formula or manual was necessary in order to separate the property allocable to Kentucky service.

PSC used a formula predicated on the revenues derived respectively from Kentucky and Ohio. This formula was applied to original cost values of the total properties in both states. In several previous rate cases, both in Ohio and Kentucky, Cincinnati Bell and Citizens had advocated its use. The formula produced a Kentucky rate base of $18,419,497.

Citizens argues that all of the property physically located in Kentucky can and should be allocated to Kentucky and that use of a formula is necessary only to determine what portion of the property in Ohio is allocable to Kentucky. Citizens argues that an “actual use” method of apportionment, on which the books of Cincinnati Bell and Citizens purportedly were set up, should be used. This method would produce a Kentucky rate base of $20,511,-690. In its brief on this appeal Citizens has repeated several times the statement that PSC has “excluded” from the rate base “more than $2,000,000 of property that is unquestionably used in providing service to its customers.” The circuit judge in his opinion made substantially the same statement. This statement rests solely on the company’s assertion that all of the property located in Kentucky is used for service to Kentucky consumers exclusively. This proposition is by no means “unquestionable.” The Supreme Court of the United States, in Smith v. Illinois Bell Telephone Company, 282 U.S. 133, 51 S.Ct. 65, 75 L. Ed. 255, pointed out the fallacy of such a proposition and recognized as an “indisputable fact” that locally situated telephone facilities are not confined in actual use to solely local service. The Court said that to load the local consumers with the full value of the local facilities would require them to “bear an undue burden.” Plainly, the patrons in the Ohio part of the Metropolitan Area receive service from the facilities in Kentucky, and it is not just that this service should be at the sole expense of the Kentucky patrons.

No formula is capable of making an exact allocation of property used and useful in providing Kentucky service; at the most a reasonable approximation can be achieved. “ * * * extreme nicety is not required, only reasonable measures being essential * * *.” Smith v. Illinois Bell Telephone Company, 282 U.S. @ 150, 51 S.Ct. at 69. Nothing has been shown to warrant a conclusion that the rate base produced by the formula used by PSC is unreasonably low, as found by the circuit court.

It is our opinion that the rate base fixed by the PSC is proper and reasonable.

As hereinbefore stated, the circuit court found that the rate of return allowed by PSC was unreasonably low. With this we are inclined to agree.

The rate allowed by PSC amounted to 5.49% on an original cost rate base. Under the evidence presented here and under the principles enunciated in Citizens Telephone Company v. Public Service Commission, Ky., 247 S.W.2d 510, we think a rate of return of not less than 6%, on an original cost rate base, is required to meet the standards of adequacy. The specific service rates which Citizens asked authority to impose would have produced a rate of return of 6.1% for a sample period .on the rate base that Citizens advocated. This indicates that the company can live with a rate in the 6% area. We shall direct that PSC allow a sufficient increase of rates to produce a rate of return in the 6% area on the rate base previously fixed by PSC.

The appellants suggest that PSC allowed as proper certain operating expense items, such as the A. T. & T. license contract fees, which PSC might well have disallowed, and that if those expenses were eliminated the rate of return under the rates approved by PSC would be 6.35%. However, we believe the PSC order must be reviewed by the courts on the basis of what it actually was—not what it might have been. See Securities and Exchange Commission v. Chenery Corporation, 318 U.S. 80, 63 S.Ct. 454, 87 L.Ed. 626; Burlington Truck Lines v. United States, 371 U.S. 156, 83 S.Ct. 239, 9 L.Ed.2d 207.

We find no reasonable basis for the position PSC has attempted to take in these proceedings with respect to the Metropolitan Area. In the hearing PSC asked Citizens to produce data as to its “earnings” in the Metropolitan Area alone, separate from its other areas of service in Kentucky, and in its brief on this appeal PSC argues that it was justified in denying any rate increase for the Metropolitan Area because Citizens did not provide the requested data. Certainly PSC was not trying to treat the Metropolitan Area as a separate rate-base unit, because in all other phases of the proceedings PSC treated the entire Kentucky service area as the rate-base unit. We need not decide whether different service areas in Kentucky, such as the separate major cities, or those cities together as a metropolitan community, could under some circumstances be treated as separate rate-base units. Historically the Citizens service area has been treated as a single unit, and PSC was not trying here to establish several different rate-base units.

We are at a loss to understand why PSC wanted separate data as to the Metropolitan Area “earnings” (whatever was meant by that word). Conceivably, after a rate base and a proper rate of return had been established, cost and earning data with reference to different parts of the company’s overall service area might have become relevant for the purpose of fixing rate classifications and to prevent discrimination in rates among the different localities. But here the data apparently was not sought for rate classification purposes, but for some vague purpose related to rate of return. It is our opinion that PSC did not show a valid reason for seeking the separate data for the Metropolitan Area.

(On the points last discussed — separate rate-base units and rate classifications — see 43 Am.Jur., Public Utilities and Services, sec. 109, pp. 648, 649 ; 43 Am.Jur., Public Utilities and Services, secs. 178 to 184, pp. 689 to 693; Annotation, 4 A.L.R.2d 596; Pioneer Telephone & Telegraph Co. v. State, 64 Okl. 304, 167 P. 995, L.R.A.1918C, 138; Michigan Bell Telephone Co. v. Odell, D.C., 45 F.2d 180).

To the extent that it sets aside the order of the Public Service Commission the judgment is affirmed; to the extent that it directs further proceedings in conformity with the opinion of the circuit court it is reversed with directions to enter judgment directing the Public Service Commission to enter a new order in conformity with this opinion, such new order to be based on the existing record but with opportunity for the parties to present arguments.


text:
    COMMONWEALTH of Kentucky, DEPARTMENT OF HIGHWAYS, Appellant, v. Charles ROBERTS and Virginia Roberts, wife, Appellees.
    Court of Appeals of Kentucky.
    March 17, 1967.
    Robert F. Matthews, Atty. Gen., H. C. Smith, Sp. Asst. Atty. Gen., L. A. Faurest, Faurest & Collier, Elizabethtown, Paul Hunley, Frankfort, Tildón H. McMasters, Elizabethtown, for appellant.
    E. E. Hubbard, John S. Kelley, Fulton, Hubbard & Kelley, Bardstown, for appel-lees.
   OSBORNE, Judge.

This is an appeal from the action of the Nelson Circuit Court fixing the value of certain land belonging to appellant which was condemned for the purpose of constructing the Central Kentucky Parkway. Prior to the condemnation proceedings, appellees’ farm consisted of 230 acres; 200 of which was level or gently rolling; 25 acres of pasture land; and approximately 5 acres of woods. The farm was in a high state of cultivation. The improvements on the farm consisted ■ of a colonial type home, tobacco barn, combination stock and dairy barn, a new aluminum farrowing house and other miscellaneous buildings along with internal and external fencing. The farm was located approximately two miles southeast of Bardstown on the Potter-shop county road. It is rectangular in shape and the Parkway runs diagonally across it taking approximately 30 acres which is required for ■ construction of the Parkway and relocation of the Pottershop road.

The only question before this court upon appeal is whether or not the verdict is excessive and unsupported by the evidence. The Commissioners appointed by the county court valued the land taken at $9,587.50 and reported the damage to the remaining property at $18,000, making a total award by the Commissioners of $27,587.50. From this award both the landowner and the Commonwealth appealed to the circuit court. Upon trial before a jury in the circuit court, it found the value of the farm, before the taking, to.be $72,000, and its value, after the taking, to be $38,000 and fixed a value of $1000 upon a temporary easement, awarding a total sum of $35,000. We believe that this award was supported by the testimony. Appellees offered four witnesses. Mr. Everett Mudd, a licensed real estate broker, who had been engaged in the real estate and auction business in that county and vicinity some 50 years, testified that in his opinion the market value of the farm prior to the taking was $82,000 or $356 per acre. He stated that its value after the taking was $41,000, thereby making a difference of $41,000. The next witness, Mr. Leland Hubbard, was also a licensed real estate broker and had been engaged in the real estate business in and around Bardstown for six years and regularly made appraisals for various lending institutions in the community. Mr. Hubbard testified that he was familiar with the property and had been for fifty years. He stated that in his opinion the value of the property before the taking was $78,000 or $340 per acre. He stated that its value after the taking was $40,000 and the difference between these two figures, or the damages suffered by appel-lees, would be $38,000. Appellees also offered as a witness Mr. Charles Roberts who testified to a before value of $82,500 and an after value of $37,500, making a difference of $45,000. Joe English, who was introduced by appellees, testified that he was a licensed real estate broker engaged in the real estate business, and that he had made many appraisals of real estate which were accepted by the farm loan companies, certain banks, and the Equitable Life Insurance Company. He testified that, in his opinion, the value before the taking was $80,500 and the after value $40,000, making a difference of $40,500. The Commonwealth introduced two witnesses as to the value of the property, both of whom are unquestionably qualified in this field. The first, Mr. David Rash, testified that the before value was $60,000, and the after value $37,400, making a difference of $22,600. The other witness, Mr. A. B. Wigginton, testified that the before value was $62,500, and the after value $39,500, making a difference of $23,-000. It will be noted that the after value of all .the witnesses is fairly consistent. The differences between the witnesses for appel-lees and for appellant is brought about because of the variance in their before values. We note that the after value of appellant’s witness, Wigginton, of $39,500, is greater than the after value of appellees’ witness, Roberts, which is $37,500.

It is our opinion that the value fixed by the jury is well within the range of the testimony of the witnesses. It is our further opinion that the witnesses who testified were well qualified to testify as to the values and that they expressed honest and impartial opinions concerning the values. Therefore, the verdict was amply supported by the evidence and falls well within the range of the competent testimony. See Commonwealth Dept. of Highways v. Barton, Ky., 398 S.W.2d 694. The Parkway takes approximately 30 acres of land. It will run diagonally across the rectangularly shaped farm and will be on a fill most of the way. It will be necessary to relocate the Pottershop road which will make a criss-cross going under the Parkway approximately in the middle of the farm and will be in a deep cut most of the way. It will be necessary to relocate the entrances to the house and the barn and other buildings on the farm. The farm will be fragmented into seven segments, or five segments if you consider the closing of the old Pottershop road. All of the witnesses agree that this fragmentation will make it difficult to cultivate and operate the farm either for the purpose of growing row crops or as a stock or diary farm. The owner will have to build an additional 345 rods of fence and one fragment of the farm will be so remotely located it will be practically impossible to reach. In view of the foregoing, we do not view the verdict as being excessive.

The judgment is affirmed.

All concur.