author: BOND, J.

text:
    THE STATE ex rel. JAMES HAGERMAN, JR., Collector of City of St. Louis, v. ST. LOUIS & EAST ST. LOUIS ELECTRIC RAILWAY COMPANY, Appellant.
    Division One,
    December 1, 1919.
    1. TAXES: Prima-Facie Case: Interstate Railway. Tbe record of the valuation and assessment of tbe property of an electric railway over an interstate bridge of the State Board of Equalization made in scrupulous conformity to the methods and plans prescribed by the statute, and certified by the State Auditor, together with an admitted correct copy of the tax bill containing complete itemizations of the kind of property and rate of taxation, makes a prima-facie case against such railway for such taxes.

      2. -: -: Tax Bill. The statute does not require that the tax hill be filed with the' petition in a suit against railroads for delinquent taxes. It makes the record of the State Board of Equalization certified by its secretary prima-facie evidence of the facts therein recited in such suits. But a correct tax-bill can bo offered as evidence.
    3. -: Double:' Electric Railway Over Interstate Bridge. Whcro an electric .railway by contract is given the right to operate its trolley lines over an interstate bridge belonging to other corporations, in consideration of a payment to them of a certain portion of the passenger fares received by it, its trolley wires, poles, cars, rails and other property owned and used by it in operating an electric railway are subject to taxation, and if such properties are separately assessed, and the other companies are assessed with taxes for the value of the bridge itself and its other structural elements, there is no double , taxation. The corporate grantee of a right of user of the bridge can be separately assessed for taxes according to the value of its trolley lines and other distinct property used in operating its electric railway over the bridge. [Distinguishing State ex rel. v. Railroad, 196 Mo. 523.]
    4. -: Discrimination: Neglect to Assess Other Property. The neglect of the State Board of Equalization to assess other railroads liable to assessment under the same valid statutes under which defendant’s railway properties were assessed, was not such a discrimination as invalidated the assessment against defendant.
    5. -: Franchise. A railway company which by the terms of its charter possesses the right to construct and operate a railroad, and has obtained permission from the city to operate its street railway over an interstate bridge for a period of fifty years, has a railroad franchise other than a franchise to be a corporation; and when the franchise to operate a railroad, which rested primarily in legislative grant, became consummate when it obtained permission of the city to occupy the bridge, its said franchise became taxable, upon a mileage basis, and could be assessed under the designation of “all other property.”
    6. -: Property Outside Staie: Railway Over Interstate Bridge. The State Board of Equalization does not exceed its authority by taxing the tangible and intangible property of an electric railway, operated over an interstate bridge, within the territorial limits of this State.
    Appeal from St. Louis City Circuit Court. — Eon. Wm. Kinsey, Judge.
    Affirmed,.

      Dawson & Garvin for appellant.
    (1) The tax bill is not legal evidence in this case, because (a) not authenticated by certificates of the collector or filed with the petition as required by law. B. S. 1899, sec. 9303; State ex rel. v. Scott, 96 Mo. 75; State ex rel. v. Phillips, 102 Mo. 664. (b) It is not baed on a valid assessment. State ex rel. v. Cunningham, 153 Mo. 642; Oort v. City of Cameron, 19 Mo. App. 585. (2) The allegation of the petition “that defendant owned, on June 1, 1906, 346 miles of roadbed and superstructure rolling stock and ‘all other property mentioned in Laws 1901, sec. 2, p. 232,’ ” is contrary to the facts. (3) The State Board has no authority (even where it has jurisdiction) either by name or under any disguise, as increased valuation, to add property which does not belong to defendant.’ State ex rel. v. Cunningham, 153 Mo. 642; State ex reí. v. Alt., 224 Mo. 513. (4) The trial court erred in not nonsuiting plaintiff as requested by defendant. R. S. 1899, sec. 9303; State ex rel. v. Railroad, 135 Mo. 618; State ex rel. v. Cunningham, 153 Mo. 642; State ex rel. v. Bank of Cartersville, 180 Mo. 717; Union Transit Co. v. Kentucky, 199 U. S. 194, 210; Louisville, Ferry Co. v. Kentucky/ 188 U. S. 385, 396; Mahan v. Meredith Bank, 160 Mo. 640; Leavell v. Blades, 237 Mo. 695; Laws 1901, p. 232; State ex rel. v. Brinkop, 238 Mo. 298; (5) The tax sought to -be collected is in part double taxation and hence illegal. The same roadbed and superstructure was taxed against the St. Louis Bridge Company and said tax paid by it. Constitution art. 10, secs. 3 and 4; State ex rel. v. Railroad, 396 Mo. 524; State ex rel. v. Bridge Co., 134 Mo. 32; State ex rel. v. Railroad, 215 Mo. 479; Wright v. Cent, of C. R. C., 236 U. S. 674; State ex rel. v. Brinkop, 238 Mo. 298. (6) The attempted taxation of defendant is unjust discrimination and in violation of the Constitution and laws of Missouri. Constitution art. 1, sec. 8; City of Independence v. Gates, 110 Mo. 374; Kansas City v. Grush, 151 Mo. 134; Brookfield v. Tooney, 141 Mo. 625. The steam railroad companies using said Eads Bridge are not taxed on roadbed and superstructure or rolling stock on said bridge, or on their . lease of all the properties of said St. Louis Bridge Company, specifically or under head “all other property,” which is in accordance with the law of Missouri. (7) Where the State Board of Equalization has jurisdiction, its valuation and assessments must be in accordance with the statutory requirements as construed by the courts. R. S. 1899, sec. 9358; State ex rel. v. Railroad, 135 Mo. 618; State ex rel. v. Lesser, 237 Mo. 318. No personal property is taxable unless the statutes declare it to be taxable. State ex rel. v. Lesser, 237 Mo. 310; State ex rel. v. Bank of Carterville, 180 Mo. 717; Union Transit Co. v. Kentucky, 199 U. S. 194. The franchise to be a corporation is not taxable. Laws 1901, p. 232. (8) Property having its situs outside of Missouri is really, if not specifically, included contrary to law. The trial court erred in refusing to so declare the law as requested by defendant. Pae. Railroad Co. v. Cass County, 53 Mo. 17; State ex rel. v. Stephens, 146 Mo. 681; State ex rel. v. Brinkop, 238 Mo. 298; Railroad v. Penn, 198 U. S. 341. (9) Defendant owned no intrastate railroad property and did no intrastate business in Missouri, and the employment of the “unit rule” or “mileage” system of valuation and assessment in this case was illegal. Fargo v. Hart, 193 U. S. 490; Louisville Ferry Co. v. Kentucky, 188 U. S. 396; Union Transit Co. v. Kentucky, 199 U. S. 210; Union Rate Cases, 230 U. S. 352; State ex rel. v. Wiggins Ferry Co., 208 Mo. 642; Railroad v. Ark. ex rel. Norwood, 235 U. S. 350; Bacon v. Illinois, 227 U. S. 512. (10) The jurisdiction of the State Board of Equalization to assess is limited to certain kinds of steam and street railroad property, specified in R. S. 1899, section 9339 (viz., length of roadbed and superstructure in city through or in which it is located in this State, rolling-stock and all other movable property) owned and used by a railroad corporation operated as such by virtue of its public franchises, and which does all or a considerable" part of its railroad business wholly within the State of Missouri. R. S. 1899, sec. 9344; State ex rel. v. Merchants Bank, 160 Mo. 640; Railroad v. Cass County, 53 Mo. 17; Leavell v. Blades, 237 Mo. 695. (a) The maintenance of defendant’s charter to be a railroad corporation merely does not make defendant or its property assessable or taxable by the State Board of Equalization as a railroad within the meaning of the Constitution and statutes. Laws 1901, p. 232; R. S. 1909, secs 11551, 11552; Anderson v. Morris E. and R. Co., 216 Fed. 83; State ex rel. v. Brinkop, 238 Mo. 298. (b) Property tangible and intangible never in Missouri is not taxable by Missouri. St. Louis v. Wiggins Ferry Co., 78 U. S. (11 Wall.) 423; Leavell v. Blades, 237 Mo. 695; State ex rel. v. Brinkop, 238 Mo. 298; State ex rel. v. Lesser, 237 Mo. 310; State ex rel. v. Wiggins Ferry Co., 208 Mo. 622; Louisville Ferry Co. v. Kentucky, 188 U. S. 396; Union Rate Cases, 230 U. S. 352. (11) The attempted taxation of defendant is a direct burden upon interstate commerce and in violation of Article 1, section 8, of the Constitution of the United States, giving Congress sole power to regulate commerce among the several states. Fargo v. Hart, 193 U. S. 490; St. Louis v. Wiggins Ferry Co., 78 U. S. (11 Wall.) 423; South Covington Ry. Co. v. Covington, 235 U. S. 537.

      Thomas G. Rutledge and J. M. Lashly for respondent.
    (1) The same questions involved here have been determined by this court under the same statutes, for railroad taxes, levied under the classification of ‘ ‘ all other property” in the taxation of that part of the intangible property of the Wiggins Ferry Company that was located in Missouri, and the question .decided, in favor of the validity of the tax in the case of State ex rel. Hammer v. Wiggins Ferry Co., 208 Mo. 622. (2) The law under which this assessment was made was passed in 1901 (Laws 1901, p. 232, now Sees. 11551-2, R. S. 1909) to give a legal basis to the assessment of the intangible property of corporations owning, operating abd managing public utilities, and was undoubtedly based upon the decisions of the Federal Supreme Court holding such intangible values to be property properly taxable in a state in the proportion that the length of the road there bears to the entire system. State ex rel. Hammer v. Ferry Co., 208 Mo. 622; St. L. Ry. v. Arkansas, 235 U. S. 350. (3) The law presumes that the Board of Equalization does its duty in making the assessment and making the computations and valuation upon which it is based. The valuation will, therefore, be presumed to be correct. As to details of procedure the statute is directory merely. State ex rel Hammer v. Ferry Co., 208 Mo. 662; State ex rel. v. Tel. Co., 165' Mo. 516; State v. Lord, 118 Mo. 4; Agan v. Shannon, 103 Mo. 661; Pittsburgh Ry. v. Backus, 154 U. S. 421; State ex rel. v. Hannibal Ry., 113 Mo. 308. The mere overvaluation of this road is not a defense, as the courts will not take on themselves the functions of a revising or equalizing board. Sec. 11399, R. S. 1909; Stanley v. Albany Co., 121 H. S. 535; Western U. Tel. Co. v. Missouri, 190 U. S. 420. (4) A state may exact from a railway company a tax upon that portion of its property within its borders, and, in assessing it for the purposes of taxation, take into consideration its value as a going concern and as a part of a general system extending over several states. State ex rel. Hammer v. Ferry Co., 208 Mo. 662; St. Louis Railroad Co. v. Norwood,- 235 IT. S. 350; Amer. Refrig. Transit Co. v. Hall, 174 U. S. 70; Western U. -Tel. Co. v. Taggart, 163 H. S. 1; Western U. Tel. Co. v. Atty.Gen., 125 TJ. S. 530; Western TJ. Tel. Co. v. Atty.-Gen., 141 U. S. 46; Maine v. Grand Trunk Ry., 142 TJ. S. 217; Cleveland Ry. v. Backus, 154 U. S. 439; Henderson Bridge Co. v. Kentucky, 166 U. S. 150; L. & N. Railroad Co. v. Greene, 244 U. S. 522; Atl. & P. Tel. Co. v. Philadelphia, 190 U. S. 160; Clue Co. v. Oak Creek, 247 U. S. 321; Postal Tel. Co. v. Adams, 155 U. S. 688; Express Co. v. Minnesota, 223 U. S. 335; Car. Co. v. Penn, 141 U. S. 18; Wisconsin Ry. Co. v. Powers, 191 U. S. 379. To be objectionable, interference with interstate commerce must be direct and not the mere incidental effect of the requirement of the usual proportional contribution to the public maintenance.
   BOND, J.

This is a suit by the Collector of the City of St. Louis for taxes for the year 1907, assessed by the State Board of Equalization against .364 of a mile of railroad, owned and operated by the defendant corporation in the City of St. Louis.

The case was submitted to the trial judge, a jury being waived, upon an agreed statement of facts. The finding and judgment of the court were rendered in favor of the plaintiff for taxes and interest in the sura of $8356.19, to which was added one thousand dollars attorneys’ fee, allowéd and taxed as costs. Defendant duly appealed.

The agreed statement of facts, or so much thereof as is pertinent, will be stated in connection with the rulings made upon the errors insisted upon in the brief and argument of appellant.

I. It is claimed that plaintiff failed to prove the case stated. The defendant procured a charter from the State of Missouri in the year 1889, as a railway company, with its western terminus in Missouri and an eastern terminus in Illinois. It has exercised the franchise granted thereunder by entering into contracts with the St. Louis Bridge Company, a corporation organized in Missouri and Illinois and the owner of a toll bridge, known as the Eads Bridge, extending from the City of St. Louis, Missouri, to the City of East St. Louis, Illinois; the Missouri Pacific Railroad Company and the Wabash Railway Company, by virtue of which contracts the defendant, in consideration of a certain division of the fare collected from passengers which it should transport across the upper deck of said bridge, was permitted to operate thereon electric trolley cars. In April, 1902, these contracts were cancelled and a neAV one made by defendant with the Terminal Railroad Company of St. Louis which had previously acquired the leasehold of said bridge. This “said substitute agreement is of date April 11, 1902, and permits defendant to operate electric cars on the upper roadway of said bridge for fifty years unless sooner terminated by said Terminal Company.” Two connecting street railways, both Illinois corporations, are made parties to this contract, the object of their joinder being to secure to the passengers carried by them a continuous passage over defendant’s electric trolley-car railroad running over said bridge and terminating in St. Louis, Missouri. In this connection the agreed statement of facts further recites:

“Under said agreement the said Terminal Association retains ownership and control of the tracks over which said trolley cars are to he run for passenger traffic only; said passengers are to he carried for a certain division of the fare of not less than five nor more than ten cents per passenger, as determined hv said Terminal Company to he paid by said bridge passengers for riding across said Eads Bridge; said electric cars to he run between the termini of said bridge; and for refusal, inability or failure of the other parties to direct travel destined to pass by way of East St. Louis to or from said City of St. Louis exclusively to said Eads Bridge, or to keep the other conditions of said agreement, said Terminal Company reserves the rVht to declare said agreement terminated and canceled.”

The defendant company was incorporated originally for $100,000. Its capital stock was subsequently increased to $250,000 in 1890, and in 1902 to $500,000. Its bonded indebtedness is $500,000, on Avbich it pays five per cent interest, and has always paid dividends on its stock.

The tax hill sued on contains intemizations according to the statute of the nature and valuation of defendant’s property and the rate of taxation levied thereon for that year, .showing the aggregate amount sued mitted to be correct, was filed with the petition. The petifor. The original bill was not filed, but a copy, adtion is substantially in the form prescribed by Section 11593, Revised Statutes 1909.

In assessing the property of defendant for the year 1907, the Board of Equalization specified the value of its passenger cars, its money on hand, the proportion of its rolling stock in this State, the proportion of its roadbed and superstructure in this State, and lastly “all other property” at $500,000.4625 per mile, which last item, computed at the length of the road in this State, amounted to $173,000.16. The addition of all the items at $186,019.98, is the basis of the- taxes levied.

The agreed facts show that at the time of this assessment defendant “owned property in the State of Missouri consisting of certain poles and overhead trolley wires erected and maintained on the west end of said tinuation of other poles and overhead trolley wires erectEads Bridge as a necessary working part and coned and maintained on the east or Illinois end of said bridge, all under said agreement of July 26, 1889, and said substitute agreement, and also $26,524.55 on deposit on June 1, 1906, in a certain bank of the city of St. Louis, Missouri, which was proceeds of said business done on said bridge under said agreements, and also two cars valued at $850 each.”

The property, tangible and intangible, owned and operated in this State by defendant, possessed- great value and earning power and to provide for its taxation, the statutes relating to the taxation of franchises other than that of corporate entity, were enacted. [Laws 1901, p. 232; R. S. 1909 secs. 11551, 11552.] The method and plan of assessment and valuation prescribed in these statutes was scrupulously followed by the State Board of Equalization. The record of its action was filed with the Auditor (R. S. 1909, sec. 11573) whose certificate thereof is made, prima-facie evidence of the facts therein recited (R. S. 1909, sec. 11578; State ex rel. v. Met. St. Ry. Co., 161 Mo. 188). We think this and other evidence in the agreed statement of facts sufficed to make a prima-facie case for plaintiff.

We have not overlooked the contention that the admittedly correct tax bill copied in the agreed statement was not filed with the petition. That is not required by the statutory form applicable to suits against railroads for delinquent taxes. [R. S. 1909, sec. 11593; State ex rel. v. Railroad, 113 Mo. 297.]

II. It is insisted'by appellant that the tax assessed in this case is void because double taxation, in that the bridge, subject to the easements evidenced by contract under which defendant conducts and operates its electric railway, was also assessed for taxation against the grantors to the defendant. ’

It will be observed that in the assessment of the property of defendant the State Board of Equalization left out of view all of the structural elements essential to the purposes for which the bridge was built and the uses to which it was to be put, and confined its view exclusively to those things which were descriptive of the separable ownership of the defendant under and by virtue of the contract possessed by it to operate and conduct its electric railway over the upper surface of the bridge, and those things which it had placed on the bridge to facilitate the operation of its electric trolley railway.

It is perfectly plain from the agreed statement of facts that the owners of the bridge were not the owners of the rolling stock, the. metals or rails over which the trolley line ran, nor the right of user thereof, nor the trolley poles and wires, and it was these, coupled with the franchise value arising from the use and operation of them by the defendant railroad, which the Board of Equalization intended to assess as the property of defendant. And it is equally clear that in its separate assessment of taxation on the bridge itself, against the owners thereof, the board did not take cognizance of tho property and franchises assessable to the owners of tho trolley company. There is nothing in this method of taxation which militates against the doctrine stated in State ex rel. v. Railroad, 196 Mo. 523, where it was correctly held that a bridge as an entirety, having been taxed once, could not, without violating the constitutional principles forbidding double taxation, be taxed a second time against the lessor. In the case at bar the bridge as a bridge, embracing its multiform uses as such, was taxed against the owners thereof, but that assessment in nowise precluded the State Board of Equalization from making another assessment against the corporate grantee of a contract of user of a right of way for its electric trolley line over said bridge. The properties taxed were distinct and the ownerships were different, and there is nothing in the agreed statement of facts which shows that the Board of Equalization had in mind the values of the property belonging to defendant when it assessed the bridge property against its separate owners.

Our conclusion is that the action of the State Board of Equalization in levying the assessment sued for, did not contravene the constitutional inhibition against double taxation.

III. There is no merit in the contention of unjust discrimination in this case. Whether defendant is taxable depends wholly upon the provisions of Sections 11551, 11552, Revised Statutes 1909 (Laws 1901, p. 232). If those statutes are valid and applicable, then the taxes assessed against defendant in this case were lawfully made, irrespective of the omission of the State Board of Equalization to make assessments under the same statutes against ' other railroads liable to assessment thereunder. The cases cited by appellant on this point are wholly irrelevant in that they refer to the invalidity of a law or city ordinance, which, by its terms, was not uniform as to the same classes. Here there is no dispute as to the validity of the statutes requiring taxation of franchises, for the only point made is that the board neglected to assess others liable under a valid law.

IY. Appellant insists that the tax assessment is illegal because the defendant owns no railroad franehises except the franchise to be a corporation, which is a non-taxable one. This is a misconception. The defendant does not own railroad franchises other than that implied in that of a grant of a charter to it. It possesses, by the terms of its charter, the right to contract and operate a railroad. The bridge over which its track is laid is, in a general sense, a public highway. Under the Constitution of this State, its right to operate its street railway over the public highway (the bridge) could only be exercised by the consent of the local authorities having control of the highways proposed to be occupied by such street railway. [Constitution, art. 12, sec. 20.] When it obtained this permission to operate its street railway on this public highway for fifty years, the legislative grant instantly became effective and vested in appellant a valuable franchise wholly distinct from its franchise of artificial entity (State ex rel. v. Railroad, 140 Mo. 1. c. 549) and one which is specifically assessable for taxation under the terms of the statutes providing for taxation of franchises. [State ex rel. v. Wiggins Perry Co., 208 Mo. 622.] Proceeding under these statutes and in accordance with the method proscribed in a subsequent section (Sec. 11559, R. S. 1909) the Board of Equalization assessed and adjusted the taxes laid on defendant’s franchises on a mileage basis and after the hearing of evidence, and in so doing it arrived at the conclusion that the value of the intangible property of defendant is Missouri was $173,000.16. It referred to this specific assessment as one made on “all other property” of defendant, a method of distinguishing the various items approved in State ex rel. v. Wiggins Perry Co., 208 Mo. 622. In the present case, as has been seen, the franchise to operate a railroad resting primarily in legislative grant, became consummate when the consent to occupy the bridge for that purpose was obtained, for then it ripened into a legislative privilege and fell within the correct meaning of the term “franchise,” which implies a privilege conferred by law to do that which “does not belong to the citizens of the country generally as a common right.” [12 R. C. L. 173, sec. 1 et seq.; State ex rel. v. Weatherby, 45 Mo. l. c. 20.] According to the agreed facts this franchise • vested in appellant, was a practical monoply with a possible life of fifty years.'

V. Nor are we able to concur in the view that in the assessment sued on in this case, the Board of Equalization undertook to tax property outside the jurisdiction of the State of Missouri. On " , , the contrary the description ox the property taxed, the itemization of amounts, discloses that they were referable only to tangible and intangible property of defendant within the territorial limits of this State.

VI. It is finally insisted by appellant that the taxation sued upon is void under the Federal Constitution vesting in Congress the power to regulate interstate commerce and prohibiting the states from taking property without due process.

It is not within the power of the states to put a direct burden on interstate commerce, the exclusive regulation of which is granted to Congress by the Constitution of the United States (U. S. Constitution, art. 1, sec. 8). But this provision does not prevent the assessment of property situated in the several states because it is a part of a unified system which is appropriated to interstate commerce. In such cases the property “may be taxed at its value as 'it is, in its organic relations, and not merely as a congeries of unrelated items, [for] taxes on such property have been sustained that took account of the augmentation of value from the commerce in which it was engaged. [Adams Exp. Co. v. Ohio State Auditor, 165 U. S. 194; Adams Exp. Co. v. Kentucky, 166 U. S. 171; Fargo v. Hart, 193 U. S. 490.] So it has been held that a tax on property and business of a railroad operated within the State might be estimated prima-facie by gross income, computed by adding to the income derived from business within the State the proportion of interstate business equal to the proportion between the road over which the business was carried within the State to the total length of the road over which it was carried. [Wisconsin & Mich. Ry. Co. v. Powers, 191 H. S. 379.] Since the commercial value of property consists in the expectation of income from it, and since taxes ultimately at least, in the long run, come out of income, obviously taxes called taxes on property, and those called taxes on income or receipts, tend to run into each other somewhat as fair value and anticipated profits run into each other in the law of damages. The difficulty of distinguishing them became greater when it was decided, not without much debate and difference of opinion, that interstate carriers’ property might be taxed as a going concern.” [Galveston etc. Ry. Co. v. Texas, 210 U. S. 217, 227.]

Under the agreed statement of facts appellant owned a usufruct in about one-third of a mile of railroad track on that portion of the bridge within the limits of Missouri. It also owned, as stated before, the rails, the superstructure and wires which enabled it to operate its trolley cars over this line. It also owned money on deposits in banks in Missouri; also the franchise of operating its railroad, granted to it by the Legislature of the State, and consented to by the local authorities in charge of the bridge. All of this property was within the territory of this State and, therefore, its assessment for taxation did not impose a direct burden upon interstate commerce under the principles declared and the rule stated in the foregoing quotation from the opinion of the Supreme Court of the United States and the authorities therein cited. The imposition in the case at bar was purely a tax on property as such, locally situated and upon a Missouri franchise locally enjoyed. It was assessed in strict accordance with the provisions of the statutes of this State and the Board of Equalization, in making this assessment, was entitled to consider' the increase in value of the property assessed by reason of its being an integral part of a railroad engaged in interstate traffic, and they were entitled to discerp the value of the property in Missouri from that of the other property of which it was a part, in the manner prescribed in the statute providing for its assessment and sanctioned by the foregoing decision of the Supreme Court of the United States. This, we think, was substantially done in the present case. We find nothing in the agreed statement of facts which tends to show that this assessment was so laid as to take the property of appellant without due' process.

Our conclusion is that the judgment of the trial court must be affirmed. It is so ordered.

Blair, P.. J., and Graves, J., concur; Woodson, J., absent.


source: Caselaw Access Project

author: GOODE, J.

license: Public Domain

text:
    STELLA BAKER v. MARVIN H. GATES et al., Executors of Will of JEMUEL C. GATES, Appelants.
    Division One,
    December 1, 1919.
    1. NEW TRIAL: Sufficiency of Evidence: AppeUate Practice. If there was any evidence developed at the trial to uphold a verdict for plaintiff, the order granting to her a new trial must he affirmed on appeal; if there was none, the. order will be set aside and the verdict for defendants reinstated.
    2. LEASE: Relation: Right of Lessor to Inspect. If the written contract granted to the lessee an estate for years, and entitled him to possession during the. term against the lessor, without any right to enter except to inspect the quarry work and ascertain whether or not it was being performed according to agreement, the relation was that of lessor and lessee.
    3. CREATION OF NUISANCE: Liability of Lessor. If the intended use of leased premises by the lessee would, of necessity, create a nuisance, the lessor must be held to have authorized the nuisance and to be answerable for consequent damage; for no one may use, or agree that some one else may use, his property so as to harm others.
    4. -: -: Explosions in Stone Quarry: Question for Jury. That a hill, leased for a stone quarry, could not be worked without danger to persons and property 400 or 450 feet from the place of blasting, and that therefore the blasting constituted a nuisance, is deducible from testimony showing that the danger was continuous, or at least occurred at intervals for a considerable period, and that it disturbed dwellers within the range of the blast, and persons exercising the common right of travel on street cars on a boulevard 400 to 450 feet from the point of blasting; and that a nuisance did not necessarily arise from the work may be inferred from evidence that the quarry could be worked without risk to the neighborhood and that before the day of the injury to plaintiff as she was riding on a street car no debris had been thrown as far as the boulevard; and hence, whether, under such circumstances, a nuisance would necessarily arise from the work, was a jury matter.
    5. -: -: Quarry Operated by Receiver and Not by Lessee. Where the leased quarry was not being operated by the lessee at the time a flying stone struck a passenger on a street car, or by any one else for whose conduct the lessor was responsible, but, without the consent of either, by a receiver in bankruptcy of a construction company under an order of court, neither the lessor, nor the lessee is liable in damages for the injury to the passenger, the lessee’s only connection with the work at the time being at most that of an employee or agent of the receiver.
    Appeal from Jackson Circuit Court. — Ron. Thomas B. Buchner, Judge.
    Reversed and remanded (with directions).

      J. R. Bell and Lathrop. Morrow, Fox and Moore for appellants.
    There is no liability on part of owner of premises for act of trespasser in possession and control. Shippey v. Kansas City, 254 Mo. 25; Pope v. Boyle, 98 Mo. 527; Grogan v. Foundry Co., 87 Mo. 321; Reinhardt v. Holmes, 143 Mo. App..212; Mayer v. Shrump, 111 Mo. App. 54; Gildersleeve v. Overstolz, 97 Mo. App. 303; Powell v. Kenaday, 95 Mo. App. 713; Schmidt v. Cook, 23 N. Y. Supp. 799; Wolf v. Kilpatrick, 101 N. Y. 146.

      J. K. Cubbison, Wm. G. Holt and E. G. Pope for respondent.
    (1) The trial court has a discretion to grant one new trial, and the appellate court will not interfere with its exercise of that discretion, however much it may disagree with that court upon such ruling, when there is any substantial evidence to support it. When the trial judge is not satisfied with the verdict, or when he thinks the verdict is against the weight of the evidence, it is not only his right but his plain duty to grant a new trial. Fitzjohn v. Transit Co., 183 Mo. 78; Harper v. Hotel Co., 142 Mo. 378; Haven v. Railroad, 155 Mo. 216; Kreinzel v. Stevens, 155 Mo. 285; Grace v. Railroad, 156 Mo. 301; Herndon v. Lewis, 175 Mo. 125; Ottomeyor v. Pritchett, 178 Mo. 165; Warner v. Railroad, 178 Mo. 129; Casey v. Transit Co., 186 Mo. 229; Franklin v. Railroad, 188 Mo. 542. (2) The blasting operations in question were inaugurated, created and started by Gates and Spitcaufsky and they were joint tortfeasors. If they knew or should have known that said blasting operations might cause danger or injury to others they were responsible for all the natural and probable consequences of such action, and neither one can escape such responsibility because of the acts of their agents or of an independent contractor. Gates entered into a contract with John Spitcaufsky by the terms of which Spitcaufsky was to do the blasting for the benefit of Gates, and defendants cannot escape liability on the theory that Spitcaufsky (who plaintiff introduced, proof showing was doing the blasting at the very moment of the accident to plaintiff) was a trespasser on said land where the blasting was being done, and especially when the evidence shows that all the defendants did prior to the accident was to serve written notice on Spitcaufsky in an attempt to cancel said contract or lease, and which attempt simply resulted in a lawsuit between defendants and Spitcaufsky which was brought by Gates after said accident, and when the evidence further shows that defendants took no further steps, outside of serving said notices, to stop said blasting operations by Spitcaufsky prior to said accident. Salmon v. Kansas City, 241 Mo. 14; Daneschocky v. Sieben, 193 S. W. 966; Dillon v. Hunt, 11 Mo. App. 246; Railway Co. v. Morey, 47 Ohio St. 207; Railway Co. v. Coskry, 92 Ala. 254; Carman v. Railroad, 4 Ohio St. 399; McCarrier v. Hollister, 15 S. D. 366; Robinson v. Webb, 11 Bush. 464; Norwalk Gaslight Co. v. Norwalk, 63 Conn. 495; Anderson v. Fleming, 66 L. R. S. (Ind.) 125; Nashville v. Brown, 9 Heisk. (Tenn.) 1; Weber v. Railroad, 20 App. Div. (N. Y.) 292; Cooley on Torts (2'Ed.), 644; Railroad v. Watkins, 43 Kan. 50; James v. MoMinimy, 93 Ky. 471; Vog’el v. New York, 92 N. Y. 19; Clark v. Fry, 8 Ohio St. 358; Walker v. New York, 107 App. Div. 351; Richmond v. Smith, 101 Ya. 161; Cohen v. New York, 113 N. Y. 532; Chapman v. Rochester, 110 N. Y. 273; Decatur v. Hamilton, 89 111. App. 561; Smith v. Davis, 22 App. D. C. 298;' Frick v. Kansas City, 117 Mo. App. 488; Brown v. Scruggs, 141 Mo. App. 632; Carson v. Construction Co., 189 Mo. App. 120; Johnson v. Machine Co., 193 Mo. App. 199.
   GOODE, J.

This is an action for damages caused by a personal injury to plaintiff. At the conclusion of the evidence the court directed a verdict for the appellants, Marvin H. Gates and B. T. Whipple, as executors of the last will of Jemuel C. Gates, deceased; but after-wards entered an order sustaining plaintiff’s motion for new trial, without stating the reason for the order. The appeal was taken by said Marvin II. Gates and B. T. Whipple, as executors.

The case was begun against Jemuel C. Gates, Joseph M. Jones, receiver of the Spitcaufsky Construction Company, and John Spitcaufsky. Jemuel Gates died during the pendency of the proceeding and an answer to an amended petition filed by plaintiff was put in by said executors at the January term, 1917. As between- plaintiff and Joseph M. Jones, as said receiver, the case was settled December 29, 1914, for one hundred dollars, plaintiff signing a stipulation to dismiss as to the receiver and to prosecute no further the cause, against him. Jones was receiver of the Spitcaufsky Construction Company under an appointment made in a proceeding in bankruptcy.

Plaintiff was hurt between eight-thirty and nine o’clock on the morning of August 4, 1914, and while she was a passenger in an electric trolley car running southward on Southwest Boulevard, a main thoroughfare between Kansas City, Missouri, and the City of Rosedale, Kansas. As the car was passing a quarry some four hundred and fifty feet from the boulevard, three charges of powder or dynamite were exploded in the quarry, hurling fragments of rock as far as the boulevard, some of it falling about the car, and one striking plaintiff’s wrist. The weather was warm; the car windows w'ere open and plaintiff had rested her arm on the windowsill.' There was evidence that on previous days in the year, blasts had been discharged in the quarry, violent enough to throw rocks three or four inches in diameter, as was the one which struck plaintiff, and perhaps some larger, onto the boulevard and beyond it.

The quarry was in a piece of ground known as Deitz hill, an eminence a hundred feet or more high and from 400 to 450 feet west of the boulevard and the street railway tracks thereon. The land wiiere Deitz hill is belonged to Jemuel Gates, who demised it, February 12, 1913, by a written agreement, to John Spiteauf - sky, for fifteen years. The quarry is situated on the brow of the hill, facnig eastwardly toward Southwest Boulevard. Tracks of two or three steam railroads extend near the east foot of the hill, between it and the boulevard, nearly on a level with the boulevard, but further from it than from the hill. One dollar is recited to have been paid and received as part of the consideration for the lease, but the instrument says the term was granted “principally for and in consideration of the premises, covenants and agreement to pay, do and perform those moneys, acts and things which the lessee hereinafter promises, covenants and agrees to pay and do.” What Gates wanted was to have Deitz hill reduced to the level of the adjacent tracks of the railroad companies, and Spiteauf sky’s undertaking to do this was the true consideration for the agreement. The contract contemplated that Spitcaufsky might make contracts with “companies, corporations or persons” to take out and crush rock on the premises; that such contracts should not impair or diminish the obligation of the lessee to perform his covenants, and there is a recital that it was understood “the personal qualifications of the lessee are largely the inducement of the lessor to enter into this lease. ’ ’ It was further provided that the lease was to be terminated “by the death or incapacity of the lessee,” and that any person, company or corporation at that time in the actual occupancy of the premises and performing the contemplated work under contracts' with the lessee, might continue operation upon giving the lessor satisfactory sureties and in a specified amount, for the strict observance by such occupant of the terms of the agreement (Pars. I, IY and XII of Lease). .It was agreed that the íease should neither be assigned nor recorded and the lessee was to use every effort and devote his entire time to the removal of all rock and material above the grade of the railroad tracks, “the very purpose and essence of this agreement being that snch work shall be conducted with all dispatch. ’ ’ The lessor and his agents were to have access to the property for the purpose of inspecting the work as it proceeded, and Gates was accorded the option to terminate the lease for breach, of any of the stipulations by Spitcaufsky, by serving' certain notices on him.

On December 8, 1913, Jemuel Gates served notice on John Spitcaufsky that, because of the latter’s failure to comply with certain specified terms of. the lease, Gates had elected to terminate it on January 15, 1914, unless prior to that date Spitcaufsky had complied with those terms. Another notice was served on Spitcaufsky, January 17, 1914, from which it appears he had written to Gates that he had complied as requested; but Gates reiterated his complaint of Spitcaufsky’s defaults and declared the lease at an end.

On July 21, 1914, two weeks before the accident in question Jemuel Gates served a notice on Joseph M. Jones, as receiver of the Spitcaufsky Construction Company, demanding that Jones desist from trespassing upon the Deitz hill property and taking rock from the quarry; saying that he would be held accountable for past and future trespasses; further saying'Spitcaufsky had viólated the terms on which he had been given the right to take rock from the premises, and because of the violation Gates had cancelled his right; that neither’ Spitcaufsky nor any one else had the right to permit Jones to enter upon or take rock from the premises.

Jemuel Gates filed an action against John Spitcaufsky to the March term, 1915, of the Jackson County Circuit Court to quiet Gates’s title to the premises, setting forth breaches of the terms of the lease as stated in the aforesaid notices, and that the lease had become null and void; that Spitcaufsky had recognized the lease was at an end, but notwithstanding those facts was “claiming the right of possession of the above described premises by virtue of the said lease and has refused to cancel or surrender the said lease in writing and thereby said lease, although terminated, in fact constitutes a cloud upon the title of this plaintiff to the property described in said lease and that’ plaintiff is remediless at law,” etc. Spitcaufsky denied by answer the alleged breaches. At the July term, 1917, when the action was in the names of Marvin H. Gates and B. Thompson Whipple, as executors of Jemuel Gates, a judgment was rendered that the lease had been terminated; that neither Spitcaufsky nor any one claiming by, through or under him had any right, title, interest or dominion over the leasehold premises, and the lease instrument was declared cancelled and removed as a cloud - upon the title of Jemuel Gates and his executors.

The amended petition on which the case at bar was tried, alleges Gates leased the premises to Spitcaufsky to use as a stone quarry, and by agreements in the lease authorized and permitted Spitcaufsky to take rock and dirt from the hill; that Gates knew Spitcaufsky in removing the dirt and stone and levelling the hill, would explode large blasts of nitro-glycerine, dynamite and other high explosives; knew the explosions would throw dirt, gravel and rock to great distances and would endanger the lives and property of persons in the vicinity and of passengers on street cars on Southwest Boulevard. It was alleged, next, that Joseph M. Jones was at all times mentioned in the petition, the duly appointed, qualified and acting receiver of the Spitcaufsky Construction Company; that said Jones, as such receiver, was on August 4, 1914, and for a long time prior thereto had been, in charge and control of the stone quarry and Construction Company; that Jemuel Gates, on August 4, 1914, and long prior thereto, knew said Jones, as such receiver, was carelessly and negligently using nitro-glycerine, dynamite, powder and other high explosives, and knew, or should have known, that said receiver, by his negligent methods of blasting, was throwing rock and dirt from the hill and endangering the lives and property of adjacent property owners and the traveling' public.' This allegation also occurs:

“ Plaintiff further states that John Spitcaufsky during all the times hereinafter mentioned, was aiding, guiding, directing and assisting said Joseph M. Jones, tli e receiver, in the operation of said stone quarry, ai d as agent of said receiver was carelessly and n« gligently aiding, guiding and directing the operation of said stone quarry.”

After the averment just quoted, the petition alleges that Jemuel C. Gates as the owner of the premises and John Spitcaufsky and Joseph M. Jones as receiver, were, on August 4, 1914, in charge of and operating the premises as a rock quarry; that Gates and Jones, as receiver, and Spitcaufsky were, on said date, operating and conducting a nuisance; that they knew, or should have known, said quarry was a nuisance and knew it was a menace to the traveling public; on August 4, 1914, Gates and Jones, as receiver, and Spitcaufsky knew, or should have known, street cars were constantly operated on Southwest Boulevard past the stone quarry, with passengers in the cars continually in danger of rocks thrown by the blasts; that said deféndants caused and permitted such blasts to be made and as a natural result thereof plaintiff was struck by a rock, etc.

Regarding who was operating the quarry on and prior to August 4th, the . receiver, Joseph M. Jones, testified as follows: He was receiver in bankruptcy ■of the Spitcaufsky Construction Company; he had never been given permission by either Jemuel Gates or his executors to go on the land; the blasting was done by men employed by him and who were on his payroll as receiver ■ of said Construction Company, and he paid them; he was conducting the operations as such receiver; had been ordered to take possession of all the property of the Construction Company, and went to Deitz hill to take possession of its property there; some of the men who had been at work there previously continued to work under him, and some did not; John Spitcaufsky went to the hill occasionally, and he discussed with Spitcaufsky the work in a general way, but the foreman in charge for him as receiver was named Stubblefield; as receiver he (Jones) continued to use some of the tools and mules previously used by the Construction Company; he took charge of the affairs of that company about June 13, 1914, and did no work in the quarry after November, 1914.

If there is any evidence to uphold a verdict for plaintiff, the order for a new trial must be affirmed; if there is none, it ought to be set aside and the verdict for appellants reinstated. [Ottomeyer v. Pritchett, 178 Mo. 160, 165; Fitzjohn v. Transit Co., 183 Mo. 74, 78.] The position taken for plaintiff is that the contract between Jemuel Gates and John Spitcaufsky was entered into by the former for the purpose of binding Spitcaufsky to perform work on Deitz hill which would endanger persons in the vicinity and on the boulevard, even if done with due care; and this would lay Gates liable for any damages occurring in the course of the work, whether the contract created the relation of lessor and lessee between him and Spitcaufsky, or proprietor and independent contractor. The relation established was that of lessor and lessee; for the instrument granted to Spitcaufsky an estate for years in the premises, and entitled him to possession during the term against Gates, who had no right to enter except to inspect the work and ascertain whether or not it was being performed according to agreement. [1 Tiffany on Landlord and Tenant, sec. 15, p. 141.] If the intended use of the premises by Spitcaufsky would, of necessity, create a nuisance, Gates, as lessor, must be held to have authorized the nuisance, and to be answerable for consequent damage; for no one may either use, or agree that some one else may use, his property so as to harm others. This fundamental principle has been applied in cases where the facts were quite like those before us. In Harris v. James (45 L. J. Q. B. [N. S.] 545) the action was against a landlord who had let a field to a tenant to operate a quarry on it, the necessary result of blasting* in the quarry being to throw dirt and stone on plaintiff’s land. That being true, the court held the landlord liable, although he would not have been if the injury had been caused by the tenant’s lack of skill or care in blasting.

And so it was ruled where a house was let for the storage of powder and a damaging explosion occurred; it appearing the vicinity was so populous that a powder magazine must be a nuisance. [Prussak v. Hutton, 51 N. Y. Supp. 761.]

And where an owner leased his premises for a kiln to dry lumber, a process which, however carefully managed, would endanger by fire the house of the plaintiff, and his house in fact caught fire from the kiln, the owner was made to respond in damages. [Helwig v. Jordan, 53 Ind. 21.]

Other apposite authorities might be cited, and among them Gilliland v. Railroad, 19 Mo. App. 411, where the rule on the subject was adopted as it is stated in a standard treatise:

“In order to charge the landlord the nuisance must necessarily result from the ordinary use of the premises by the tenant, or for the purpose for which they were let'; and where the ill results flow from the improper or negligent use of the premises by the tenant, or, in other words, where the use of the premises may or may not become a nuisance, according as the tenant exercised reasonable care, or used the premises negligently, the tenant alone is chargeable for the damages arising therefrom^” [2 Wood on Landlord & Tenant (2 Ed.), p. 1283.]

• The inference that the quarry on Deitz hill could not be worked without danger to persons and property as far away as Southwest Boulevard, is deducible from the facts in proof; and as there was testimony to show the danger was continuous, or at least occurred at intervals for a considerable period, the work was, in the strict sense of the word, a nuisance; for it disturbed persons who dwelt within range of the blasts in the quarry and also persons on the boulevard in the exercise of the common right to travel there. [Pollock on Torts (6 Ed.), 385; Tiffany on Landlord & Tenant, see. 102, p. 681..] And it was a jury matter whether a nuisance would necessarily arise from the work, as there were facts in evidence to prove the quarry could be worked without risk to the neighborhood; also that before the day of the accident no debris had been thrown as far as the boulevard. [Prussak v. Hutton, 51 N. Y. Supp. 761; Fish v. Dodge, 4 Denio, 311.]

Therefore the question for decision here is whether there is evidence to prove John Spitcaufsky, or any one else for whose conduct the lessor Gates was responsible, was operating the quarry and thereby maintaining the nuisance at the time plaintiff was hurt. It is asserted Spitcaufsky was working the quarry on that day, either by and for himself exclusively, or in conjunction with Jones, the receiver, and that because of Spitcaufsky’s separate or joint charge of the work, he caused plaintiff’s hurt, and Gates, who authorized the work, is answerable too. Attentive study of every item of evidence to warrant a finding that Spitcaufsky was wholly or partly in charge of operations when the accident happened, have satisfied us there was no evidence tending to prove he was. The case made by the petition is that the receiver was in chárge and control on that day and long prior thereto, and that Spitcaufsky was aiding, guiding and directing the work as the receiver’s agent, instead of in his individual capacity. Several witnesses testified to seeing John Spitcaufsky about the quarry on and prior to the day of the accident, giving orders and directing the work, but there is nothing in this inconsistent with the averment of the petition that Spitcaufsky was acting as Jones’s agent, or contradictory of the testimony of the receiver that he was operating the quarry and had been in charge since June 13th, nearly two months before the date of the accident. It is said the petition filed by the appellants as executors of the lessor to remove the cloud of the lease from the title, shows Spitcaufsky was in possession of the hill or in charge of the work on it on August 4,191.4, and long after. We have quoted the only passage of that petition which refers to what Spitcaufsky was doing or claiming, and it has no tendency to prove Spitcaufsky was working the quarry when the accident occurred, or later, but only that he claimed an interest and right of possession.

The receiver was not operating there with the consent of Jemuel Gates or the appellants, and so testified. Besides, a notice had been served on him July 8, 1914, by Jemuel Gates that he was trespassing on the leased premises and to desist from taking rock from them. It might be deduced from circumstances in proof, although there is no direct testimony to that effect, that Spitcaufsky Construction Company had been operating the quarry under a contract with John Spitcaufsky, the lessee, as provided in paragraphs one and four of the lease agreement, and that Jones, having been appointed receiver in bankruptcy of said company, took over the work. If Spitcaufsky had contracted with the Construction Company to take rock and dirt from the hill, a contract authorized by the lease agreement, the lessor would have been as responsible for an injury done while the Construction Company was in charge as for one caused by Spitcaufsky himself. But the relation of lessor and lessee did not exist between Gates and the receiver, and no fact appears to indicate that the receiver was working the quarry under authority from Gates as licensee. The lease agreement will not bear the interpretation that Gates was responsible for the torts of a possible receiver in bankruptcy of some person or company whom Spitcaufsky might employ. Whatever right, if any, Jones possessed to conduct the quarry, he got from the court which appointed him. This is by the way, for it is not contended for respondent, that Gates was answerable for the receiver’s torts, the argument being that there is evidence to support an inference that Spitcaufsky was doing the work. We hold there was none to show he was doing it, except as agent or employee of the receiver. Spitcaufsky might be liable as a joint tortfeasor for any injury done while thus acting, and that is the theory of the petition; hut Gates as lessor would not he answerable for Spitcauf sky’s acts while in the employ of a person who had no authority, direct or indirect, to work the quarry.

The judgment is reversed and the cause remanded, with directions to set aside the order sustaining the motion for new trial and to reinstate the verdict for appellants and render judgment thereon.

All concur.


author: GRAVES, J. GRAVES, J.

text:
    AMERICAN FOREST COMPANY, Appellant, v. JOSEPHINE R. HALL et al., Administrators of Estate of JOHN C. HALL.
    Division One,
    December 1, 1919.
    1. NECESSARY PARTIES: Pledgor of Note Alone: Trustee of Express Trust: No Possession. It is not enough to authorize the pledgor of a negotiable note, exceeding in amount the debt for which pledged, to maintain suit on the note in his name alone, that the pledgee loan it to him for purposes of protest, consent to and aid the pledgor in the suit, and through his counsel present the note in evidence at the trial; but in order to constitute the pledgor a trustee of an express trust, the pledgee must actually part with the physical possession of the note. If the original payee, after his assignment of the note, becomes possessed thereof, he can maintain the action in his name alone, notwithstanding his name is indorsed thereon in blank, for under the statute (Sec. 10018, R. S. 1909) he can strike out the indorsement and make a paper title in himself; but without actual possession, the right to strike out the indorsement, or to maintain an action on the note as the trustee of an express trust, does not exist.
    2. -: -: -: -: Pledged Note in Excess of Debt. The fact that the notes, indorsed in blank, exceed the amount of the debt for whose payment they were pledged, does not authorize the pledgor alone, without actual physical possession of the notes, to maintain suit thereon, although the pledgee consents to such suit. By an indorsement in blank and delivery notes are fully negotiated, and the indorser loses all title thereto, even title to the excess of the amount thereof over the debt for which they are pledged, and for the title to pass back to the indorser or pledgor there must be an actual redelivery. Nor does the fact that the pledgee ioaned the notes to the pledgor for purposes of protest, nor that the pledgor in his petition alleges that he is the owner and legal hold thereof, make him the trustee of an express trust, for he must prove such allegation.
    Appeal from Jackson Circuit Court. — Hon. Harris Robinson, Judge.
    Affirmed.

      George H. Williams and. John A. Hope for appellant.
    (1) The pledgees, had they so elected, could have proceeded in their own names. 3 R. C. L. sec. 202, p. 994; 21 R. C. L. secs. 29 and 31, pp. 666 to 669; Logan v. Smith, 62 Mo. 455; White v. Phelps 100 Am. Dec. (Minn.) 190. (2) But, having the consent of the pledgees, plaintiff American Forest Company, pledgor, also had the right to proceed in its name alone. Under the facts and circumstances above stated, this action was and is properly prosecuted in the name of American Forest Company as sole plaintiff, (a) Plaintiff is a trustee with respect to the rights of its pledgees of the notes. And the Code expressly sanctions the prosecution of such an action in the name of the trustee without joining the beneficiary. Sec. 1730, R. S. 1909. West Plains Bank v. Edwards, 84 Mo. App. 469; Springfield to use. v. Weaver, 137 Mo. 670. The same principle is applied in Beattie v. Lett,' 28 Mo. 596; Guerney v. ■Moore, 131 Mo. 668; Carter- v. Butler, 264 Mo. 325. (b) Section 1730, is said to have been copied from the New York Code, Harrigan v. Webb, 49 Mo. App. 504. The Court of Appeals of New York has held that the pledgor may maintain the suit if there is such recognition of him by the pledgee as will “protect the defendant upon a recovery against him from a subsequent action by the assignor.” Hays v. Hathorn, 74 N. Y. 504. Under the circumstances, payment by the defendants of any judgment rendered against them in this action would bar any subsequent action by the pledgees. And this is as far as defendants have any right to inquire. Jolly v. Huebler, 132 Mo. App. 686; Hutchings v. Reinhalter, 23 R. I. 520; Dyer v. Sebrell, 135 Cal. 598; Greene v. McAuley, 70 Kan. 607. (e) It is the universal rule, independent of the above statutory provision (Sec. 1730), that the pledgor, having as in this case the acquiescence of the pledgee, may sue in his own name for the benefit of himself and his pledgee, and recovery should not be denied on the ground that the note is pledged or that only the pledgee can sue. 21 R. C. L. sec. 31, p. 669; 3 R. C. L. sec. 200, p. 991; 2 Daniel on Negotiable Instruments (6 Ed.), secs. 1181a, 1191, 1192, 1200 and 1201. (d) The following further authorities support our contention that plaintiff can proceed in its own name: Nicolay v. Fritschle, 40 Mo. 67; Barber v. Straub, 111 Mo. App. 585;.Hovey v. Sebring, 24 Mich. 232; Titonic Bank v. Bagley, 68 Me. 250; McCallum v. Driggs, 35 Fla. 288; Jump v. Leon, 192 Mass. 513; Fay v. Hunt, 190 Mass. 378; Lowell v. Bickford, 201 Mass. 545.

      Chas. H. Winston for respondents.
    (1) The payee of the notes cannot sue on the notes already indorsed and transferred by such payee, nor can such payee lawfully collect the notes. R. S. 1909, secs. 10001,10002,10003, 10021,10027 and 10174; Overall v. Ellis, 32 Mo. 327. The indorsements and delivery of the notes had the same effect to transfer the entire legal title to the assignees, and left nothing in the assignor but a right to demand an accounting upon certain contingencies. Overall, Admr. v. Ellis, 32 Mo. 327, 38 Mo. 209 ; Lee v. Turner, 89 Mo. 489; Neuhoff v. O’Reilly, 93 Mo. 169; Turner v. Hoyle, 95 Mo. 346; Keim.v. Yette, 167 Mo. 399; Wright Inv. Co. v. Frisco Realty Co., 178 Mo. 80.. (2) Neither the probate court, nor the circuit court on appeal, has any power or jurisdiction to allow any equitable claim or demand of assignor or pledgor or indorser of the four notes held by the bank and trust company whether as assignees? pledgees or indorsees of said notes; nor has the probate court, or the circuit court on appeal, any jurisdiction to allow appellant any conditional right or claim or demand before the happening of the condition, if any, upon which such conditional right or claim or demand shall have become absolute, if at all, and so be a legal right, claim or demand, and not a mere equitable or conditional right, claim or demand. Tenny v. Lasley, 80 Mo. 664; Stevens v. Stevens, 172 Mo. 37; R. S. 1909, sec 10174; Jeffers v. Oliver, 5 Mo. 433; Langham to use of Ortley v. Lebarge, 6 Mo. 355; Davis v. Christy, 8 Mo. 570; Wooden v. Butler, 10 Mo. 718; Webb v. Morgan, 14 Mo. 430; Boeka v. Nuella, 28 Mo. 180; Beattie v. Lett, 28 Mo. 596; Bennet v. Pound, 28 Mo. 598; Brady v. Chandler, 31 Mo. 28; Hutchings v. Weems, 35 Mo. 285; Simmons v. Belt, 35 Mo. 461; Thomas v, Wash, 1 Mo. 665. “Our statute of assignments clearly requires the legal owner to sue in his own name.” Boeka v. Nuella, 28 Mo. 180.; Beattie v. Lett, 28 Mo. 596; Bennet v. Pound, 28 Mo. 598; Simmons v. Belt, 35 Mo. 461.
   GRAVES, J.

There is a mass of record in this case, and a brief for respondent (we mean designated as Statement, Brief and Argument) of 198 pages. The pertinent facts are within a small compass, as also are the legal questions involved.

On December 1, 1910, the Chicot County Cotton-Alfalfa Farm Company (a Missouri corporation) made and executed four notes of $15,000 each to the “American Forest Company” (a New York corporation). These four notes were secured by deed of trust on some lands in the State of Arkansas. The maker of these notes, as appears on the face thereof, was the Farm Company supra. On the back of each note appeared the names of Wallace Estill, John C. Hall and Odon Guitar, Jr. We take it from the record that such was the condition of the paper when delivered to the American Forest Company. The notes were due respectively in three, four, five and six years. Before the maturity of either of said notes, the American Forest Company indorsed the note due in three years, by signing its name on the back thereof, and delivered the same to the Broadway Bank, of St. Louis, as collateral security for its note to such bank for some $15,000. In like manner the other three were indorsed and delivered to the St. Louis Union Trust Company, as collateral security to a note of large proportions held by that company, and executed by the American Forest Company.

There is a long history preceding the giving of the four $15,000 notes, signed as aforesaid, but most of it is immaterial to the real issues here. So far as material (if at all) it will be left for the proper points in the opinion. The notes upon their face referred to the deed of trust aforesaid, and the deed of trust contained a provision as follows:

“It is expressly agreed and understood that failure to pay the interest upon said notes, or any of them, annually, when due and continuance in such default for a period of thirty days, shall cause all of said notes to become immediately due and payable, though not then due by the tenor, terms and effect thereof.”

The deed of trust, in describing the four notes which it was given to secure, says:

“Whereas, the said Chicot Co. Cotton-Alfalfa Farm Company is indebted to the said party of the third part, the American Forest Company, in the sum of sixty thousand dollars, evidenced by four certain negotiable promissory notes of even date herewith for the sum of fifteen thousand dollars each, and due and payable respectively in three, four, five and six years from their date, with interest at the rate of five per cent per annum from date until paid, interest being payable upon said notes annually, and each of said notes being indorsed by Wallace Estill, of Estill, Mo., Odon Guitar, Jr., of St. Louis, Mo., and John G. Hall, of Kansas City, Mo., and all of said notes being payable at the office of said American Forest Company in St. Louis, Mo.”

Both the notes and the deed of trust referred to in the face of the notes placed the signers upon back thereof in the capacity of indorsers, as we formerly understood that term.

July 30, 1913, John C. Hall died intestate, and his widow and son were made the adminstrators of his estate in the Jackson County Probate Court. On July 29, 1914, the American Forest Company presented a demand against the John O. Hall estate, in which it sought an allowance of $57,919.73 in its behalf, alleging that:

“The said John C. Hall during his lifetime, to-wit, on the first day of December, 1910, made, executed and delivered, at the city of Kansas City, Missouri, for value received, his four certain negotiable promissory notes for the sum of fifteen thousand dollars each, payable on or before three, four, five and six years, respectively, after said Décember 1, 1910, to the order of American Forest Company, with interest at the rate of five per cent per annum from date; copies of which said notes are hereto attached and marked Exhibits 'A,’ ‘B,’ ‘C’ and ‘D,’ respectively.”

And further pleading the deed of trust the said demand avers the maturity of all the notes, and the ownership of the notes in form as follows:

“And this claimant avers that the recitals in said deed of trust were made a part of each of the several notes hereinbefore referred to, as made, executed and delivered by said John C. Hall, by recital and reference in each of said notes to said, deed of trust, as will more fully appear by the copies, of said notes hereto attached.

“Claimant further avers that it still is the legal holder and owner of all said notes.

1 ‘ Claimant further avers that the first of the aforesaid notes is overdue and unpaid, according to the face and reading thereof, and the three remaining notes have been duly and legally declared due by the undersigned as the holder thereof, because of the failure to pay the interest due annually, and the default thereof for a period of thirty days thereafter, in accordance with the provisions of the deed of trust securing same, referred to and described in the face of said notes, a copy of which is hereto annexed; all four of which notes have been duly presented for payment, and payment thereof having been refused, have been duly and formally protested for non-payment, and the maker and indorsers duly notified thereof.”

Unverified copies of the four notes and copy of the deed of trust were attached to the demand, as was also a notice of demand. The notice above thus describes the liability of John C. Hall, on the four notes:

“Josephine R. Hall, Administratrix of the estate of John C. Hall, deceased, will take notice that the undersigned, American Forest Company, a corporation, has a demand against said estate for the sum of sixty thousand dollars and for interest thereon from December 1, 1912, to date, amounting to the sum of thirty-four hundred and forty-six dollars and twenty-five cents, with protest fees of twelve dollars founded on four promissory notes indorsed by said John G. Hall, of which the following are copies:”

The copies are the same as those attached to the demand or claim. Upon trial in the probate court, judgment went for defendants. Upon trial de novo in the circuit court (to which appeal was taken from the probate court) there was a like result. In. the circuit court trial was had without the intervening of a jury. Instructions given and refused indicate in a way the views of that court. The instructions, both given and refused, upon both sides are as follows:

“Thereupon, plaintiff asked the court to declare the law to be as set forth in the following three declarations of law, numbered respectively 1, 2, and 3, to-wit:

“1. The court declares that under the law, the pleadings, and the evidence in the case, the claimant, American Forest Company, is entitled to recover and that the four notes presented for allowance herein must be allowed and classified in the fifth class as demands against the estate of John C. Plall, deceased, for the full amount thereof, less any payments which the. Court may find to have been made thereon. — Refused.

“2. If the court finds that the estáte of John O. Hall, deceased, is liable on the four notes involved herein, then the claimant, American Forest Company, is a proper party to present and have the said notes allowed in its name as claim against said estate; notwithstanding the court may further find and believe from the evidence that one of said notes was and is now pledged to the Broadway Bank as collateral to secure a debt of said Forest Company to said bank of less amount than the pledged note, and notwithstanding also, that the three remaining notes were and are now pledged to the St. Louis Union Trust Company as collateral to secure a debt of said Forest Company to said Trust Company of less amount than said three pledged notes . — Refused.

“3. Notwithstanding the court may find and believe from the evidence that the American Forest Company was a New York corporation and maintained an office and had business transactions in this State, yet if the court further finds and believes from the evidence that such maintainance of an office and business transactions were merely incidental to and connected with commerce or business transactions done or had in other states, then said American Forest Company was engaged in interstate commerce and was not subject to the statutes of this State concerning foreign corporations doing-business in this State, and was not required to comply therewith, and it is no defense to the claim sought to be allowed herein that the said American Forest Company had not complied with the statutes of this State relating to foreign corporations doing business in this State.— Given.”

And at the same time defendants asked the conrt to give the following seven declarations of law, numbered respectively 1, 2, 3, 4, 5, 6 and 7, to-wit:

“1. The court declares the law to be that under the law and the evidence in this case the American Forest Company cannot recover, and the finding must be for the appellees. — Given.

“3. The court declares the law to be that having written its name ‘American Forest Co., J. H. Byrd, Pres.’ ” on the backs of each and all of the four promissory notes, Exhibits 1, 2, 3 and 4, read in evidence, and having thereupon delivered the first note due, said Exhibit 1, to the Broadway Bank of St. Louis, Mo., so indorsed, for a valuable consideration, and' having also thereupon delivered said other three notes, Exhibits 2, 3 and 4, to the St. Louis Union Trust Company of St. Louis, Mo., so indorsed for value, appellant cannot recover herein.” —Given.

“6. The court declares the law to be that the American Forest Company cannot have or maintain action as a pledge of the four notes in the sum of $15,000 each, read in evidence, without joining the Broadway Bank and the St. Louis Union Trust Company as co-plaintiffs, with appellant in this action in the probate court; and that inasmuch as said Broadway Bank and said St. Louis Union Trust Company were not joined with the American Forest Company as plaintiffs in said probate court, the finding must be for appellees.— Given.

“2. The -court declares the law to be that appellant’s claim or demand as pledgor of the four notes of $15,000 each, is not the same claim or demand as that stated in the petition filed in the probate court by American Forest Company on the twentieth day of July, 1914, but in another and different claim or demand or cause of action from that set forth and contained in said petition; and that therefore, the claim or demand of appellant as a pledgor of said four notes cannot be allowed by the circuit court on this appeal. — Refused.

“4. The court declares the law to be that, if American Forest Company had any right of action' against Chicot County Cotto'n-Alfalfa Company on the four notes, Exhibits 1, 2, 3 and 4, read in evidence, or on either or any thereof, then the right of action against the appellees ’ herein on the cause of action stated in appellant’s petition, filed July 20, 191.4, in the probate court in this suit, is barred by the Statute of Limitations and the estate of John C. Hall, deceased, is exonerated from any and all liability. — Refused.

“5. The court declares the law to be that inasmuch as neither of the four promissory notes, Exhibits 1, 2, 3 and 4, read in evidence, was ever filed in the Probate Court of Jackson County at Kansas City, Mo., and neither thereof is or has been filed in this, the circuit court of said county in this suit, and inasmuch as appellant has not filed with said notes the affidavit required by Revised Statutes 1909, Sections 201 and 202, neither said probate court nor the circuit court can allow said notes as a claim or demand herein. — Refused.

“7. The court declares the law to be that the American Forest Company was a foreign corporation doing business as such in the State of Missouri without any license therefor at the time when the four promissory notes and the deed of trust, Exhibits 1, 2, 3, 4 and 5, read in evidence, were made and delivered in said State of Missouri, and that said promissory notes are and ever were void in so far at least as concerns the American Forest Company; and that by reason thereof appellant cannot recover herein. — Refused.’’

From the adverse judgment in the Circuit Court, the American Forest Co. has appealed. It should be added that from the time the American Forest Company endorsed the notes, and delivered the one to the Broadway Bank and the other three to the St. Louis Trust Company, the possession of the same has been in those two financial institutions, and in addition the debts for which they were held as collateral have only been partially paid. This outlines the case.-

I. It is clear from instructions 3 and 6 given by the trial court for the defendant that the court took the position that the pledgor, the American Forest Company, could not (acting alone) maintain this action. This is the crucial question in the case, as we see it. 'A few additional facts should be stated. Whilst the notes were pledged, yet at the time this action was begun, the notes, in amounts, exceeded the debts' for which they were pledged. That is to say, the note pledged to the Broadway Bank, exceeded by a $1000 the debt for which it was pledged, as such debt existed at the institution of this suit. So also the three notes with the Trust Company exceeded by several thousand dollars the debt for which they were pledged. In addition, the pledgees of the notes consented to and aided in this action by the pledgor. The pledgees not only turned over the notes for the purpose of protest, but through their own counsel had the notes present for the trial. In short, they not only consented to, but assisted in the prosecution of the action in the name of the pledgor. Were these two instructions proper under these facts'?

The plaintiff first contends that it is a trustee of an express trust, and can maintain this suit without joining its beneficiaries, and calls, our attention to Section 1730, Revised Statutes 1909. The question is whether or not the evidence in this case makes the American Forest Company a trustee of an express trust. The evidence shows that the two pledgees permitted the American Forest Company to have the notes for the purpose of protest, after which the possession was reverted to the pledgees. It is clear that the pledgees did not turn over the physical possession of, these notes to the pledgor at the institution of the suit. The notes were not filed with the claim. Only copies .thereof were filed. In fact, the evidence tends strongly to show that, whilst the pledgees were assisting in the prosecution of the claim, yet they held on like grim death to the possession of the notes. When introduced in evidence on the trial they came from the possession of the pledgees. After being introduced in evidence, they were not left with the court or with the papers in the case, but again reverted to the possession of the pledgees. There can be no doubt that the pledgees might have turned over these notes to the pledgor for suit in its name, and that under such circumstances the pledgor would be a trustee of an express trust, and could sue without joining the pledgees. This was expressly ruled by this court in Springfield to use. v. Weaver, 137 Mo. l. c. 760, whereat this court said:

“The evidence shows that the bank, which held the tax bills as collateral, turned them over to Reilly the payee for collection, and authorized the suit to be instituted if necessary. This authority constituted Reilly the trustee of an express trust under the decisions of this court and gave him the right to sue in his own name under express provisions of the statute. He had possession of the bill and held the legal title; and the fact that it was impressed with a trust to -the bank did not deprive him of the right to sue in his own name. [R. S.. 1889, sec. 1991; Snider v. Express Co., 77 Mo. 527, and cases cited; Fisher v. Patton, 134 Mo. 32.]”

This was a tax bill, and our court (Dickey v. Porter, 203 Mo. 1. .c. 23) has drawn a distinction-between commercial paper and a tax bill; but on the idea that the delivery by the pledgee or assignee to the pledgor or assignor of the instrument for the purpose of bringing suit upon and collecting it, would make the pledgor or assignor a trustee of an express trust, we take it the rule would be the same in each case. In other words, had the pledgees or assignees of these notes redelivered them to the American Forest -Company for the purpose of having that company sue upon and collect them, there would be no question that the American Forest Company could maintain the suit in its name, as trustee of an express trust. This, because of the agreement between the parties. But the evidence in this case discloses no such facts. Here the pledgees or assignees were holding on to the possession like grim death. They seemingly encouraged the suit, but did not turn over the possession to the American Forest Company prior to the suit for the purpose of maintaining the suit. They hung to the possession even during the trial, as they did before, and as they did thereafter. If they ever had an idea of making the American Forest Company a trustee they evidenced but little confidence in their trustee. The facts in evidence do not bear out the theory of a trustee of an express trust. If they did, there would be no trouble with the case for the plaintiff. Such a relationship must have some evidence to sustain it. The record here shows no such understanding or agreement as to make the American Forest Company a trustee of an express trust. A condition precedent is absent, i. e., the transfer of the possession of the notes to the American Forest Company. This was emphasized in the case of Springfield to use. v. Weaver, supra; whilst the Dickey-Porter case, supra, is broader and holds that the payee in a tax bill (pledged for less than its amount) has a right to sue on the bill, the court clearly recognizes a distinction between pledges of this kind (tax bills) and assigned notes or commercial paper.

■ The rule as to who can sue is well stated by Brown, C., in Carter v. Butler, 264 Mo. l. c. 325, thus:

“In Dugan v. United States, 3 Wheat. 172, perhaps the leading modern ease upon the subject, the Supreme Court of the United States formulated the rule as follows: ‘After an examination of the cases on this subject (which cannot all of them be reconciled), the court is of opinion that if any person who indorses a bill of exchange to another, whether for value or for the purpose of collection, shall come to the possession thereof again, he shall be regarded, unless the contrary . appear in evidence, as- the bona-fide holder and proprietor of such bill, and shall be entitled to recover, notwithstanding there may be on it one or more indorsements in full subsequent to the one to bim without producing any receipt or indorsement back from either of such indorsees, whose names he may strike from the bill, or not, as he may think proper.’ This case was decided in 1818. In 1859 Mr. Story, in his excellent work on Promissory Notes, sec. 452, said of it that it seemed to be the better opinion maintained in America, notwithstanding some early doctrine the other way. In the same year the doctrine to its fullest extent was unqualifiedly indorsed by this court in Beattie v. Lett, 28 Mo. 596, and it has now been placed entirely beyond our control by the Legislature, in Section 10018, Revised Statutes 1909, which is as follows: ‘The holder may at any time strike out any indorsement which is not necessary to his title. The indorser whose indorsement is struck out, and all indorsers subsequent to him, are thereby relieved from liability on the instrument.’ Section 10160 defines ‘holder’ to be ‘the payee or indorsee of a bill . . . who is in possession of it.? This definition was evidently intended to meet the legal situation we have just been considering, by excluding from its terms all payees and indorsees not in possession, as well as by including the payee or indorsee in possession for the time being.”

So in the case at bar, had the American Forest Company (after its assignment of the notes) become possessed thereof, it could have brought and maintained the suit, notwithstanding its name as indorser was written thereon. With possession, it could have stricken out the indorsement and made a paper title to the notes. But it must be borne in mind that the condition precedent to all this, is the possession of the notes by the person suing. Without this possession the right to strike out indorsements does not exist. The mere introduction of the instruments in evidence, coming as they did from the hands of the pledges or assignees, did not either in law or in fact remove the indorsement. On the other hand, the source from which the instruments came at the trial indicated that possession had

never been surrendered, and that tbe indorsements were in full force and effect. So that whilst we recognize to its fullest extent that the assignee of commercial paper may-place the same in the hands of the assignor or pledgor and direct him to bring suit, and thus authorize a suit in the name of the pledgor as a trustee of an express trust, yet the facts of this case do not bring it within the rule. At the bottom of the rule stands the transfer of the possession, and the facts of this case thoroughly negative the transfer of possession. The theory of a trustee of an express trust is not in the case.

II. It is urged that the pledgees were willing to have the pledgors bring the suit, and consented to the suit: but this is not sufficient, so long as they hold on to the possession. It required the transfer of possession to give the pedgor the right to sue, on the theory of a trustee. This we suggest in addition to what is said in Paragraph One, supra.

It is also urged that, because the notes for which the notes in suit were pledged did not equal the notes involved here, this surplus left in the pledgor the right to sue. Dickey v. Porter, supra, is cited as an authority. That was a tax bill, and falls within a different category. Such instruments are choses in action, but not commercial paper. The Dickey-Porter case recognized the difference, as does also Bichardson v. Ashby, 132 Mo. l. c. 245. The blank indorsement of these notes and the subsequent delivery thereof to the Broadway Bank and the St. Louis Union Trust Company placed the right to sue in those corporations.

By Section 10001, Eevised Statutes 1909, it is provided : ‘ ‘ An instrument is negotiated when it is transferred from one person to another in such manner as to constitute the transferee the holder thereof. If payable to bearer it is negotiated by delivery; if payable to order it is negotiated by the indorsement of the holder completed by delivery.”

By Section 10002, Revised Statutes 1909, it it further provided: “The indorsement must he written on the instrument itself or upon a paper attached thereto. The signature of the indorser, without additional words, is a sufficient indorsement.”

.And by Section 10004, Revised Statutes 1909, it is provided: An indorsement may be either special or in blank; and may also be either restrictive or qualified, or conditional. A special indorsement specifies the person to whom or to whose order the instrument is to be payable; and the indorsement of such indorsee is necessary to the further negotiation of the instrument. An indorsement in blank specifies no indorsee, and an instrument so indorsed is payable to bearer, and may be negotiated by delivery.”

The instruments before us were indorsed in blank and delivered as aforesaid before maturity. They were .therefore fully negotiated, within meaning of our statutes.

It is true that Section 10003, Revised Statutes 1909, says: “The indorsement must be an indorsement of the entire instrument. An indorsement, which purports to transfer to the indorsee a part only of the amount payable, or which purports to transfer the instrument to two or more indorsees severally, does not operate as a .negotiation of the instrument. But where the instrument has been paid in part it may be indorsed as to the residue.” But no such indorsement was made here.

The indorsement and delivery of these notes constituted a negotiation of them under the statutes. They would thereafter pass by delivery, it is true, [R. S. 1909, sec. 10001.] But under all the evidence in this case there was no redelivery of these notes to the original payee, in the sense of transferring any kind of title. By the indorsements and delivery, first made, the payee, American Forest Company, lost all title to the notes. They were unconditionally negotiated. The said original payee could not sue thereon. In an early case (Brady v. Chandler, 31 Mo. l. c. 29) Scott, J., said:

“The instrument sued on was a note, and the justice of the peace had jurisdiction of the action. [Mc-Gowen v. West, 7 Mo. 569.] Before the action was brought Brady & Bro. had assigned the note to William Brady. After the assignment, there was no title to Brady & Bro., legal or equitable. They then had no right to bring this action. They were the plaintiffs as the cause stood. The endorsing a suit for the benefit of another is a matter of no importance in determining who are the real parties to the suit. Although the action was stated to be to the use of William Brady, that did not make him a party. The suit should have been brought in the name of William Brady. [Jeffers v. Oliver, 5 Mo. 433.] ”

It is true in this case, that the payees, Brady &• Bro. had made what our Section 10004, Revised Statutes 1909, denominates a special indorsement. They had indorsed to Wm. Brady. But whilst in the case at bar the indorsements were in blank, the delivery carried the title to Broadway Bank and St. Louis Union Trust Company just as effectively as if the indorsement had been special. It required a redelivery to transfer the title ■back to American .Forest Company, and no such redelivery was ever made or attempted to be made.

In Hutchings v. Weems, 35 Mo. l. c. 286, this court said:

“This was a suit commenced in a justice’s court upon an instrument in the nature of a promissory note. There was judgment in the circuit court for the plaintiff, and the defendant moved in arrest of judgment, for the reason that the suit was improperly brought in the name of Hutchings to the use of Blackford. The motion was overruled and the defendant appealed. The motion should have been sustained. ■ The law is imperative that suits must be brought in the name of the real parties in interest (excepting the few cases specially provided for by statute). Judgment will be reversed and the cause remanded to the circuit court, where the record can be so amended as to make the real party in interest the plaintiff, if that court find that it should he done in furtherance of justice.”

Blackford was the assignee of the instrument and Hutchings was the payee. This suggestion makes the quotation, supra, clear.

Our statutes contemplate the bringing of the action by the party in interest. It does not exclude, but includes, the trustee of an express trust. Absent this relationship, as we hold in this case, then the actual party in interest must bring the suits. In the instant case the indorsements and delivery of these notes placed not only the title, but the right to sue in the Broadway Bank and the St. Louis Union Trust Company. That title and that right might have -been reinvested in the American Forest Company by a redelivery of the negotiated notes to it, but this was not done. A loaning of the notes for purpose of protest did not meet tiie situation. Nor did the production of the notes at the trial by the pledgees meet the situation. The evidence fails to show further negotiation of these notes by delivery.

In the claim filed, the American Forest Company asserted, as it was bound to do, that it was the legal, owner and holder of notes. This it failed to prove. From it all we feel constrained to hold that the peremptory instruction to find for defendants was properly given.

"With this view the other instructions drop out of the case.

The judgment is affirmed.

Blair, P. J., concurs; Bond, J., concurs in result; Woodson, J., not sitting.

ON MOTION FOR REHEARING.

GRAVES, J.

We are confronted with a vigorous motion for rehearing in this case, and the vigor of it, occasions this opinion.

I. It is first urged in the motion that: “The denial of plaintiff’s right to sue on the pledged notes is based in the "opinion upon a theory of the law which has no application. The opinion follows Brady v. Chandler, 31 Mo. 29; Hutchings v. Weems, 35 Mo. 286, and Carter v. Butler, 264 Mo. l. c. 325. In each of these cases the situation before the Court was that of a complete transfer or assignment of the whole ownership and possession of the note. In such cases the question as to who can sue on the note is, of course, controlled by the ordinary law of negotiable instruments and possession by the plaintiff at the time of the commencement of the action and thereafter is necessary.”

The trouble with our learned brothers is that they have overlooked an express statute on the subject of commercial' paper. They have made out no ease of pledgor or pledgee in the literal and true sense of those terms. They show notes indorsed in blank, which when delivered (as was true here) carries the full title and interest. The only error we have discovered in the opinion, is where we use in the statement the words “pledgor” and “pledgee,” when we should have used the “assignor” and “assignee.”

In the opinion we called to counsel’s attention several sections of our negotiable instrument latv, but these are overlooked by our learned brothers at the bar.

Section 10003, Revised Statutes 1909, among other things says: ‘ The indorsement must be an indorsement of the entire instrument.” The previous sections designate how indorsements shall be made and the effect thereof. Under Section 10001, Revised Statutes 1909, these notes were fully and completely negotiated in law, when they were indorsed in blank, and delivered. There is no dispute that the notes were indorsed in blank and delivered. Under the law the negotiation of the notes stands admitted. This negotiation of the notes, under these statutes, carried all of the American Forest Company’s rights therein. Section 10004, Revised Statutes 1909, seems to contemplate “restrictive or qualified or conditional” indorsements, but the American Forest Company, did not so indorse. It may be (a question we do not decide) that the American Forest Company might have so indorsed these notes as to have retained title or interest in them, but they did not do so. This Company fully negotiated these notes, and it never afterward acquired possession thereof. How we can say in one breath that our commercial paper has been fully negotiated (as were these notes), and then in the next breath say the payee therein has an interest in them, is beyond our reasoning. “Negotiated” as written in our statute means something. It is meaningless in the view of learned counsel. The statute says that it means that the transferee is the holder thereof. The holder thereof is the person possessed of the right to sue. We reiterate that Gantt, J., in Dickey v. Porter, 203 Mo., recognizes clearly the distinction between negotiable and non-negotiable instruments. He was dealing with a pledged tax-bill and not a negotiable note, as we have here. His ruling is authority for our ruling; and not adverse to it.

II. We did not discuss (it is true) the question as to whether or not the banks by their conduct might not have been estopped from suing upon these notes, had the American Forest Company obtained judgment. That question was not a vital one in the case. In fact it is not a question at all. The question here is the right of the American Forest Company to sue upon these notes, and not whether or not by acts in pais, the banks have estopped themselves from suing thereon. Live and vital 'issues of the case are the ones for discussion in the opinion and not side and irrelevant issues. Whether the conduct of the banks might have estopped them from further action in the premises should be left to a case where the question is vital. The question here is, did the American Forest Company, after negotiating these notes, have the right to sue upon them? When this question is kept in mind, the case is a simple one as under our law as to negotiable instruments they had parted with all their rights in and to these notes. There is no restriction in their indorsement, so far as this record shows.

To clarify the situation, suppose the banks had sued upon these notes, and the defendants had suggested by tbeir answer that there was a defect in the parties plaintiff in that the American Forest Company was a party in interest and should have sued along with the banks? What should a court do in this situation, with the clear and unqualified indorsement of the notes, and the delivery admitted? The question answers itself.

There is no substance in the motion for rehearing and it should be overruled. If the mistake in thus bringing the suit works a hardship, it is not one brought about by law or this court. • Let the motion be overruled.

Blair, P. J., and Woodson, J., concur.