author: DODSON, Justice.

text:
    W. W. MONTGOMERY d/b/a Montgomery Tractor Company, Appellant, v. FUQUAY-MOUSER, INC., d/b/a Red River Farm Supply, Appellee.
    No. 8888.
    Court of Civil Appeals of Texas, Amarillo.
    May 31, 1978.

      D. J. Brookreson, Seymour, for appellant. Malone & Heatly (Don Ross Malone), Vernon, for appellee.
   DODSON, Justice.

The holder of an unpaid purchase money lien brought this action for a writ of possession of a tractor against the original purchaser Otis Johnson and a subsequent purchaser W. W. Montgomery d/b/a Montgomery Tractor Company. The seller-lienholder, Fuquay-Mouser, Inc. d/b/a Red River Farm Supply, took a default judgment against Otis Johnson and proceeded against W. W. Montgomery who was in possession of the tractor. Montgomery contested Fu-quay-Mouser’s right to repossess the tractor, alleging that the plaintiffs had waived their lien and were estopped from asserting it. At trial the jury failed to find either issue in defendant’s favor. Accordingly, the trial court entered judgment granting a writ of possession to Fuquay-Mouser. On appeal Montgomery attacks the factual sufficiency of the evidence supporting the jury’s negative answers on the issues of waiver and estoppel. We affirm the trial court’s judgment.

On June 25, 1975, Fuquay-Mouser sold a Massey-Ferguson tractor and chisel plow to Otis Johnson. Johnson executed a retail installment contract and security agreement for $23,700 creating a purchase money lien on the equipment. After perfecting the lien Fuquay-Mouser assigned it to Massey-Ferguson Credit Corporation.

When Johnson decided to sell the tractor he and Fuquay-Mouser arranged for W. W. Montgomery to sell it at auction. Montgomery was advised of the purchase money lien. When the tractor did not sell at auction Montgomery agreed to purchasé it from Johnson for $16,900. Montgomery’s check in that amount was payable solely to Johnson. Johnson subsequently paid Massey-Ferguson Credit Corporation $7,900 under the installment contract; however, there is no evidence in the record that Massey-Ferguson knew that Johnson had sold the tractor. After unsuccessfully attempting to obtain further payment from Johnson, Massey-Ferguson reassigned the contract to Fuquay-Mouser who brought this action for possession of the tractor.

A security agreement is effective between parties and against purchasers of the collateral. Tex.Bus. & Comm.Code Ann. § 9.201 (Supp.1978). The security interest continues in collateral after it is sold unless the disposition was authorized by the secured party. Tex.Bus. & Comm.Code Ann. § 9.306(b) (Supp.1978). Thus, absent such authorized transfer, the transferee takes subject to the security interest and the secured party may maintain an action against him. See Comment 3 Tex.Bus. & Comm.Code Ann. § 9.306 (1968) and White-Sellie’s Jewelry Co. v. Goodyear Tire & Rubber Co., 477 S.W.2d 658, 661 (Tex.Civ. App.—Houston [14th Dist.] 1972, no writ). Among the defenses available to a purchaser of goods encumbered by a security interest are the § 9.306(b) defense that the secured party authorized its disposition and the defense that the security interest was waived. Weisbart & Co. v. First National Bank of Dalhart, Texas, 568 F.2d 391, 396 (5th Cir. 1978).

The defenses asserted in this case were that FuqUay-Mouser was estopped from enforcing its security interest and that the security interest had been waived. Montgomery had the burden of persuading the trier of fact on these affirmative defenses. He does not bring forward points asserting that he conclusively established, waiver and estoppel as a matter of law. Therefore, Montgomery’s complaint on appeal is essentially that the jury’s negative answers are so against the great weight and preponderance of the evidence as to be manifestly wrong and unjust. Traylor v. Goulding, 497 S.W.2d 944, 945 (Tex.1973).

Although we have viewed all of the evidence, both favorable and unfavorable, we cannot say that the jury’s answer to each of these issues was so against the great weight of the evidence as to be manifestly unjust. There is no evidence, or at most insufficient evidence in the record that could have supported an affirmative jury answer on the issue of estoppel. Moreover, the jury’s failure to make an affirmative finding does not need to be supported by affirmative evidence. Traylor v. Goulding, supra.

Waiver is the intentional relinquishment of a known right or intentional conduct inconsistent with claiming it, with full knowledge of the material facts. Massachusetts Bonding and Insurance Co. v. Orkin Exterminating Company, 416 S.W.2d 396, 401 (Tex.1967); Ford v. Culbertson, 158 Tex. 124, 308 S.W.2d 855, 865 (1958). The jury’s answer to the issue on waiver is not against the great weight and preponderance of the evidence because there was no showing that either Massey-Ferguson or Fuquay-Mouser ever consented to a private sale of the tractor that left the lien unsatisfied. There is no evidence that the note holder, Massey-Ferguson, knew of the tractor’s sale either at the time it was placed with Montgomery for sale or subsequently when they accepted the $7,900 paid by Johnson under the installment contract. Although Fuquay-Mouser was not the lien-holder during the period of events said to constitute waiver, the evidence does not indicate that Fuquay-Mouser knew that the tractor was privately sold without the lien being satisfied, or that Johnson had later paid $7,900 to Massey-Ferguson. In short, the record does not establish that either Fuquay-Mouser or the prior lienholder, Massey-Ferguson, intentionally and knowingly waived their security interest in the tractor.

Accordingly, we cannot say that the jury’s answer to the special issues on estop-pel and waiver were against the great weight of the evidence before them. Appellant’s points of error are overruled. The judgment of the trial court is affirmed.


source: Caselaw Access Project

author: McDONALD, Chief Justice.

license: Public Domain

text:
    FIRST STATE BANK OF SAN DIEGO, Appellant, v. COUNTY OF DUVAL, Appellee.
    No. 5831.
    Court of Civil Appeals of Texas, Waco.
    May 31, 1978.
    Rehearing Denied July 6, 1978.
    Mary Joe Carroll, Conrad P. Werkenthin and E. Barham Bratton, Clark, Thomas, Winters & Shapiro, Austin, for appellant.
    Gary R. Gurwitz and Charles C. Murray, Atlas, Hall, Schwarz, Mills, Gurwitz & Bland, McAllen, for appellee.
   OPINION

McDONALD, Chief Justice.

This is an appeal by appellant Bank from $184,995.48 judgment for appellee Duval County in a usury case.

Appellee County sued appellant Bank for penalties under Article 5069-1.06 for usury allegedly charged appellee by appellant on loans.

Appellant denied that any interest was charged that was usurious.

Thereafter appellee filed motion for summary judgment for usurious interest charged and received. Such motion stated it was based on the “pleadings, deposition, attached exhibits thereto, as well as any affidavits attached thereto”.

The trial court by order on December 23, 1976 held that the “depositions and exhibits on file establish as a matter of law” that interest charged by appellant on loans was usurious; rendered partial summary judgment against appellant for $111,927.78; further decreed appellee entitled to reasonable attorneys’ fees against appellant “to be fixed by the court”; and set hearing for such purpose for January 20, 1977.

On February 28, 1977 the trial court rendered final judgment reciting evidence was heard to correct mathematical calculations of interest charged by appellant, on attorneys’ fees, and “it appearing to the court that the depositions and exhibits on file, and the stipulations of the parties, establish as a matter of law” the existence of usury; and decreed appellee recover from appellant the sum of $110,945.40 and $12,384.92 in usury penalties, plus $61,665.16 as reasonable attorneys’ fees (for a total of $184,-995.48).

Appellant Bank appeals on 5 points contending:

1) The trial, court erred in granting partial summary judgment in that there is no evidence supporting the finding of usury upon which the order is based.
2) The trial court erred in granting summary judgment in that there were disputed issues of material fact as to appellant’s position in the transactions involved.
3) The trial court erred in depriving appellant of its right to jury trial, and itself fixing attorneys’ fees.

The partial summary judgment order states it is based on depositions and exhibits on file, and the final judgment states that it is based on “the depositions and exhibits on file, and the stipulations of the parties”.

Appellee’s motion for partial summary judgment attached no affidavits. The only affidavits in the record are those attached to appellant’s response which refute the judgment rendered.

There is accompanying the record an instrument titled “Deposition of B. 0. Goldt-horn” to which is attached an envelope of papers.

The deposition reflects that it was neither sworn to nor signed by B. 0. Goldthorn; and contains this statement.

“A Notary Public not being readily available, it was stipulated by counsel that the testimony of the witness could be taken without his first being duly sworn; further that the witness could later read his deposition when completed, and subscribe and swear to it before a Notary Public at that time; whereupon said witness was examined upon oral interrogatories propounded by counsel, and made answer thereto, as hereinafter contained”.

The contemplated later action never occurred. Mr. Goldthorn never signed or swore to his deposition.

Hearing on the motion for summary judgment was held December 15, 1976 and order granting the partial summary judgment was signed on December 23, 1976. Hearing on the recomputation of interest charged and attorneys’ fees was held on January 21, 1977 (and order entered February 28, 1977).

The “deposition” was not filed in the trial court until January 24, 1977, (3 days after the hearing).

Appellee has caused a second supplemental transcript to be brought to this court which reflects the following proceedings were had on January 21, 1977.

EXCERPT

“MR. GURWITZ: Does the court have the original file?
THE COURT: I do not.
MR. GURWITZ: Mr. Ellzey, I assumed all along that Mr. Goldthorn’s deposition was on file. It was sent to you a year ago to file it.
MR. ELLZEY: My memory fails if it is or not.
MR. GURWITZ: Can we agree that, if it is not it will be?
MR. ELLZEY: That is correct.
MR. GURWITZ: The first thing I would like to do is to offer the deposition of Barney Goldthorn as an adverse witness into the record together with all exhibits attached thereto, particularly exhibits 8 through 16, which have to do with the contract between the County and the Bank for the County to be depository, and also exhibits 18 through 22, which are the Bank’s exhibits having to do with the principal amounts charged by the Bank, rate of interest charged, and the amount of interest charged daily. I think those should be in the record and I will offer those.
MR. ELLZEY: It is our position that the only proper procedure this morning is a summary judgment procedure for the purpose of entering a final judgment, making an interlocutory summary judgment appealable, at which hearing evidence is not offered and we take the position this could not properly be a trial on the merits this morning and we object, therefore to the violation of the rules of summary judgment proceeding.
THE COURT: The objection as made, will be overruled and they will be admitted. I do have copies of the exhibits”.
EXCERPT
“MR. GURWITZ: First of all, I would like to have marked and filed the original deposition of Mr. B. 0. Goldthorn. It has not been signed, but Mr. Ellzey and I have agreed.
THE COURT: So agreed.
MR. ELLZEY: Yes Sir.
THE COURT: The court has had this during the time — the benefit of this deposition and exhibit during the time the court has been ruling.
MR. GURWITZ: Neither Mr. Ellzey nor I realized it actually had not been filed”.

Appellant has filed its objection to the filing of the foregoing contained in the second supplemental transcript, but we have permitted it to be filed. Such second supplemental transcript reflects: 1) The agreement of counsel for appellant and ap-pellee that the “deposition” of Mr. Gold-thorn could be filed: 2) That such “deposition” was admitted by the trial court into evidence at the hearing on January 21, 1977.

The “deposition” and exhibits are the only evidence that the Bank charged usury, and what usurious interest was charged.

But the “deposition” reflects that Gold-thorn was never administered an oath prior to giving his answers to questions.

Neither as summary judgment evidence on the partial summary judgment hearing on December 23,1976 nor on the final judgment hearing on January 21, 1977 has anyone ever sworn that any statement made in the Goldthorn “deposition” or that the exhibits which are attached to it are true and correct.

Even though counsel agreed that the “deposition” could be “filed,” since Mr. Goldthorn never swore to either his testimony or the authenticity or correctness of the exhibits, there is no evidence to support either the partial summary judgment or the final judgment. And the agreement of counsel did not waive the swearing of Mr. Goldthorn. See: Boswell v. Handley, S.Ct., 397 S.W.2d 213; Graves v. Dullnig, CCA (Eastland) NWH, 548 S.W.2d 502; O’Byrne v. Oak Park Trust & Savings Bank, CCA (Beaumont) NRE, 450 S.W.2d 411; Perkins v. Crittenden, S.Ct., 462 S.W.2d 565.

In O’Byrne the court said: “The unsworn deposition of Rita Jagnow Davis is incompetent to prove anything”; and in Perkins the court held that for purposes of summary judgment an instrument which contains an acknowledgment rather than a jurat is not an affidavit and does not purport to be a certification that the person acknowledging it swears to the truth of the matter set out.

The trial judge awarded appellee $61,665.16 as reasonable attorneys’ fees, even though appellant had paid a jury fee and insisted on jury trial of this issue. Ap-pellee asserts that since Article 5069-1.06 provides: “Any person who contracts for, charges or receives interest which is greater than the amount authorized by this Subtitle, shall forfeit to the obligor twice the amount of interest * * *, and reasonable attorneys’ fees fixed by the court”; that appellant was not entitled to a jury to fix attorneys’ fees.

Gulf Paving Co. v. Lofstedt, 144 Tex. 17, 188 S.W.2d 155 holds that generally the reasonable value of attorneys’ fees is for the jury to determine. And State v. Credit Bureau of Laredo, Inc., S.Ct., 530 S.W.2d 288 holds that suit to enforce civil penalties under Article 5069 is an action to which the right to trial by jury attaches. To the same effect are Great American Reserve Insurance Company v. Britton, S.Ct., 406 S.W.2d 901; Reynolds Research and Manufacturing Company v. Scamardo, CCA (Waco) NWH, 412 S.W.2d 941.

Contentions 1 through 3 are sustained. Appellee’s cross point is overruled.

REVERSED & REMANDED


author: CORNELIUS, Chief Justice.

text:
    FIRESTONE PHOTOGRAPHS, INC., Appellant, v. Cyrus T. LAMASTER, Appellee.
    No. 8550.
    Court of Civil Appeals of Texas, Texarkana.
    June 6, 1978.

      Daniel L. Firestone, Firestone Photographs, Inc., pro se (on appeal only).
    Robert G. Boydston, Roberts, Walls & Boydston, Dallas, for appellee.
   CORNELIUS, Chief Justice.

The principal issue to be determined on this appeal is the propriety of the district court’s award to the plaintiff of Sixty-five Thousand Two Hundred and Forty-five Dollars ($65,245.00) in the form of sanctions imposed upon the defendant for refusal to comply with discovery orders.

• Plaintiff Lamaster filed suit against Defendant Firestone Photographs, Inc., asserting a cause of action based upon alleged fraudulent representations in connection with a “distributor agreement” they had executed. Plaintiff sought rescission of the agreement, actual damages, punitive damages and attorney’s fees. Several disputes arose between the parties concerning defendant’s obligation to answer certain interrogatories, and whether defendant’s president, Daniel L. Firestone, would be required to appear in Dallas, Texas, for the purpose of giving his deposition. The defendant complained that several of the interrogatories would require answers which would violate the privilege against self-incrimination and would improperly reveal certain trade secrets; that because of the great amount of information sought by some of the interrogatories and the voluminous state of defendant’s business records, plaintiff should be required to go to Ohio where the records were located and secure the information by his own inspection pursuant to the provisions of Tex.R.Civ.P. 168; and that Mr. Firestone should be deposed in Ohio, where he resided, rather than in Dallas. Defendant requested „ that the court enter a protective order granting it relief from the objectionable features of the discovery proceedings. After notice and hearing, the district court entered a modified protective order guarding against the unauthorized dissemination of information concerning defendant’s alleged trade secrets, but refused to require plaintiff to go to Ohio and secure the desired information from an inspection of the defendant’s records, or to require Mr. Firestone’s deposition to be taken in Ohio rather than in Dallas. Despite the court’s orders to do so, defendant' refused to answer certain of the interrogatories and failed to produce Mr. Firestone for deposition. After several motions for contempt and for sanctions had been filed and hearings held thereon, the district court entered an order granting sanctions, which provided, inter alia, the following:

“IT IS, THEREFORE, ORDERED, ADJUDGED AND DECREED by the Court that Defendant, Firestone Photographs, Inc., pay sanctions of Two Hundred Fifty Dollars ($250.00) for failing to appear at the deposition on February 13, 1976, and further that Defendant pay sanctions of Two Hundred Fifty Dollars ($250.00) for failure to submit answers to Plaintiff’s interrogatories on February 12, 1976, each such action being contrary to the previous orders of this Court.
“IT IS FURTHER ORDERED, ADJUDGED AND DECREED by the Court that if Defendant fails to appear for the deposition by producing its President, Daniel L. Firestone, with the subpoenaed materials, at the offices of Plaintiff’s attorney or in this Court, at Defendant’s election- upon giving twenty-four (24) hours notice of place and time to Plaintiff’s attorney, within twenty (20) days from February 19, 1976, Defendant shall pay additional sanctions of Five Hundred Dollars ($500.00) and for each succeeding twenty-day period that such failure continues, Defendant shall pay additional sanctions of double the sanctions amount of the last preceding twenty-day period. (Thus, in addition to the attorneys fees awarded herein, Defendant has incurred sanctions of $250.00 for failing to appear at the deposition and shall.incur another $500.00 sanction amount if the deposition appearance is not made on or before March 10, 1976, and another $1,000.00 if not made on or before March 30, 1976, and shall continue to incur such progressively increasing sanctions until terminated as provided herein.)
“IT IS FURTHER ORDERED, ADJUDGED AND DECREED by the Court that if Defendant fails to answer Plaintiff’s written interrogatories that were specifically ordered to be answered by this Court’s order compelling answers to written interrogatories by delivering same to the offices of Plaintiff’s attorney within twenty days from February 12, 1976, Defendant shall pay additional sanctions of Five Hundred Dollars ($500.00) and for each succeeding twenty-day period that such failure continues Defendant shall pay additional sanctions of double the sanctions amount of the last preceding twenty-day period.
“IT IS FURTHER ORDERED, ADJUDGED AND DECREED by the Court that the foregoing sanctions shall continue and accumulate for the benefit of Plaintiff; provided, however, that the total of such sanction shall not exceed the sum prayed for in Plaintiff’s Original Petition and provided that such sanctions shall cease at such time as Defendant assures this Court that it will comply with the orders of this Court at a time certain and reasonable or at such time as waived by Plaintiff.”

Defendant’s failure to answer the interrogatories or to appear for the deposition continued until, on November 11,1976, the case was called for trial. At that time plaintiff waived all relief prayed for in his petition and moved for judgment solely in the amount of the sanctions which had accumulated to that time, up to the amount originally sought by his suit. Over defendant’s objection, the district court granted plaintiff’s motion and entered judgment in his favor for $65,245.00 plus $750.00 attorney’s fees. Although Mr. Firestone did not personally appear, defendant’s counsel appeared and participated in all the proceedings leading to the judgment, including the various hearings concerning discovery and the motions for sanctions.

Defendant urges here that the district court should have granted its motion for protective order insofar as inspection of defendant’s records in Ohio was concerned, and that the judgment is erroneous because there is no statutory authority for sanctions of the type ordered by the court, and further because the imposition of monetary sanctions for plaintiff’s benefit in effect constituted a default judgment which improperly included $50,000.00 punitive damages and $5,000.00 attorney’s fees when there was no proof of same as is required for a default judgment when damages are unliquidated.

Tex.R.Civ.P. 215a and 168 provide for the imposition of sanctions upon a party or witness for failure to comply with authorized pre-trial discovery orders. Rule 215a, pertaining to depositions and subpoenaes duces tecum, provides in part as follows:

“(b) Failure to Comply with Order. If a party . . refuses to be sworn or refuses to answer any question, or to comply with such subpoena duces tecum, after being directed to do so by the court . the refusal may be considered a contempt of that court. Or the court in which the action is pending may make such orders in regard to the refusal as are just, and among others, those permitted by Rule 170.
“(c) Failure of Party or Witness to Attend. If a party or an officer . of a party, . . . fails to appear before the officer who is to take his oral deposition or his answers to written questions or cross-questions under these rules, after proper service of subpoena or notice as provided in Rule 201, the court in which the action is pending on motion and notice may strike out all or any part of the pleading of that party, or dismiss the action or proceeding or any part thereof, or direct that such party shall not be permitted to present his grounds for relief or his defense, or enter a judgment by default against that party, or make such other order with respect thereto as may be just.
“Any witness . . may be punished as for contempt of the court . .

Rule 168, pertaining to interrogatories, provides that:

“If a party refuses to answer any interrogatory, the proponent of the question may, upon reasonable notice to all persons affected, apply to the court in which the action is pending for an order compelling an answer. Reasonable expenses, including reasonable attorney’s fees, incurred in obtaining the order or opposing the motion may be assessed, and a refusal to comply with the order shall authorize the court to act, as provided in paragraphs (a) and (b) of Rule 215a.”

Rule 215a was patterned after Rule 37 of the Federal Rules of Civil Procedure and was designed to give the trial court an expeditious procedure for insuring the effectiveness of pre-trial discovery and for dealing with recalcitrant or contumacious parties and witnesses. The authorized sanctions are not intended to be arbitrary and exclusive, but flexible and plural, vesting in the trial court broad discretion to fashion a remedy which will secure compliance with its orders and deter future noncompliance. See Commentary to Rule 215a, Tex.R.Civ.P.; Dow Chemical Company v. Benton, 163 Tex. 477, 357 S.W.2d 565 (1962); Plodzik v. Owens-Corning Fiberglas Corp., 549 S.W.2d 52 (Tex.Civ.App. Austin 1977, no writ); Pena v. Williams, 547 S.W.2d 671 (Tex.Civ.App. San Antonio 1977, no writ). The choice of the appropriate sanctions is for the trial court rather than the appellate court, and as long as such sanctions are within the authority vested in the trial court they will not be overturned unless they constitute a clear abuse of discretion. Emerick v. Fenick Industries, Inc., 539 F.2d 1379 (5th Cir. 1976); Atlantic Cape Fisheries v. Hartford Fire Ins. Co., 509 F.2d 577 (1st Cir. 1975); Di Gregorio v. First Rediscount Corporation, 506 F.2d 781 (3rd Cir. 1974); U. S. Leasing Corp. v. O'Neill, Price, Anderson & Fouchard, Inc., 553 S.W.2d 11 (Tex.Civ.App. Houston—14th Dist. 1977, no writ).

By its specific enumeration, Rule 215a authorizes the district court to impose the most severe types of sanctions — striking of pleadings, dismissal of the suit or entry of default judgment, preclusion of defenses, and contempt. Although the right to impose monetary penalties (other than contempt fines or expenses and attorney’s fees) is not specifically mentioned, it seems that if the court, upon a party’s disobedience, is empowered to immediately preclude the presentation of all that party’s defenses and enter default judgment against him on the pleadings, it would alternatively have the right to impose periodic monetary penalties for his continuing disobedience, not to exceed the amount for which judgment could have been summarily entered. Such a procedure would appear to be more just and lenient toward the defendant than the immediate entry of a default judgment.

The district court exercised commendable patience in the face of defendant’s obstinate refusal to obey its discovery orders, and gave the defendant every opportunity to avoid the consequences of which it now complains. If defendant desired to avoid those consequences, it had only to comply with the court’s orders. Even after entry of the order for sanctions, defendant had succeeding twenty-day periods in which it could have complied and thus kept the penalties at a minimum while preserving its right to fully defend the action. Instead, it chose to make repeated, defiant refusals to obey the court’s orders. In the circumstances of this case, we believe the district court’s order came within the provisions of the rules authorizing “such orders as are just,” and that its action did not constitute an abuse of discretion.

Nor can we agree that the judgment was invalid for failure of plaintiff to make proof of his unliquidated damages and attorney’s fees as would be required for a default judgment. The judgment was not one for damages and attorney’s fees, but one for sanctions imposed by authority of Rule 215a. Neither does the order constitute an adjudication of contempt. Defendant was cited for contempt, but the motion for contempt was waived, and hearing and judgment proceeded upon the motion for sanctions alone.

Also, from the record before us, we cannot say that the district court abused its discretion in overruling defendant’s motion for an order requiring plaintiff to obtain the informátion sought by the contested interrogatories by his own inspection of defendant’s records in Ohio. Although Rule 168 provides that a party may be obligated to ascertain the answer to an interrogatory by an inspection of his opponent’s records if the burden of doing so would be substantially the same for the party serving the interrogatory as for the party answering the same, there is no indication in the record that such was the case. There is only a partial statement of facts, and we do not know what evidence, if any, was produced on the question. Under the circumstances, we cannot say that the district court erred in denying the motion.

As concerns the claim of trade secrets, such a claim, even if correct, does not necessarily defeat the right of discovery. It simply imposes upon the trial court the obligation to weigh the need for discovery against the desirability for preserving secrecy, and to protect the material from unnecessary public disclosure. Automatic Drilling Machines, Inc. v. Miller, 515 S.W.2d 256 (Tex.1974). Moreover, there is no proof in the record that the requested information constituted trade secrets, and even if it did, it appears that the court’s modified order sufficiently protected defendant’s right against the unauthorized or harmful disclosure or dissemination of such information.

The judgment of the trial court is affirmed.

      . The court could, of course, have found defendant in contempt, provided proper notice and due process were observed. See Tex.R. Civ.P. 215a.


author: SHANNON, Justice.

text:
    Tom F. CALDWELL, Jr., Appellant, v. Scottie Gayle STEVENSON, Appellee.
    No. 12701.
    Court of Civil Appeals of Texas, Austin.
    June 7, 1978.
    Rehearing Denied June 21, 1978.

      Robert J. Werner, Hilgers, Watkins, Led-better & Hays, Austin, for appellant.
    J. Winston Chapman, Levbarg, Weeks & Chapman, Austin, for appellee.
   SHANNON, Justice.

This is an appeal from a summary judgment that appellant Tom F. Caldwell, Jr., take nothing from appellee Scottie Gayle Stevenson. The problem is whether Caldwell signed a promissory note as surety or principal. We will affirm the judgment.

Caldwell, Stevenson, W. R. Newman, and Mrs. W. B. Newman signed a promissory note in 1963 for $7,829.12 payable to North Austin State Bank. Although Caldwell made several payments on the note, no other co-signer paid anything.

After no further payments on the note were made, the bank matured the entire indebtedness. The bank filed suit in 1966 in the district court of Travis County against the four co-signers in an effort to recover the note balance and interest due. Caldwell filed an answer and a cross-action against the Newmans and Stevenson to recover payments previously made.

The district court entered judgment in 1966 for the bank against the four co-signers of the note, jointly and severally for $6,849.80, and for Caldwell against each of the other co-signers in the sum of $995.59.

In January, 1972, Caldwell paid the judgment in full and obtained a release from the bank. Caldwell then filed suit only against Stevenson in August, 1975, for the sum he paid for the 1966 judgment.

Both Caldwell and Stevenson filed motions for summary judgment. The 1963 note was not attached as summary judgment proof to either motion. The district court denied Caldwell’s motion for summary judgment and granted Stevenson’s motion.

Caldwell’s position is that he was an accommodation party (surety) on the note and that Stevenson was a principal. Caldwell claims as surety he was subrogated to the rights of the bank, and was therefore entitled to sue Stevenson for reimbursement on the basis of the original judgment.

Stevenson defends entry of the summary judgment upon the premise that Caldwell was a principal, not a surety, and therefore after Caldwell paid the entire judgment he was entitled to partial contribution from each co-maker in the amount of his aliquot share of the debt. Stevenson urges that Caldwell’s cause of action for contribution is in assumpsit or implied promise to pay. Because that cause of action must be filed within two years, Stevenson claims Caldwell’s cause was barred by limitations. Texas Rev.Civ.Stat.Ann. art. 5526 (1958).

The note was signed in 1963 and the judgment on the note was entered in 1966. The Negotiable Instruments Act, Tex.Laws 1919, ch. 123, § 1-198 at 190-312, was effective until September 1, 1967. On that date the Texas Uniform Commercial Code became operative. The Code, however, does not change the law of the surety-principal-creditor relationship. Clark, Suretyship in the Uniform Commercial Code, 46 Texas L.Rev. 453, 454 (1968).

Co-signers of a note are divided usually into two general categories, principals or sureties. If one is a principal he is commonly designated a maker. Capps v. Huff, 427 S.W.2d 121 (Tex.Civ.App.1968, no writ). If one is a surety he is termed usually an accommodation party or guarantor. V. I. P. Commercial Contractors v. Alkas, 553 S.W.2d 656 (Tex.Civ.App.1977, no writ).

A co-maker’s liability to the payee is joint and several. Beitel v. Beitel, 109 S.W.2d 345 (Tex.Civ.App.1937, writ dism’d w. o. j.); Estrada v. River Oaks Bank & Trust, 550 S.W.2d 719, 729 (Tex.Civ.App.1977, writ ref’d n. r. e.); presently governed by Tex.Bus. & Comm.Code Ann. § 3.118(5) (1968). As between one another, co-makers are presumed liable in equal amounts. 9 Tex.Jur.2d Bills and Notes § 226 (1959). If one co-maker pays the entire judgment entered against all of the co-makers, he is entitled to contribution from each co-maker in the amount of his aliquot share of the debt. Beitel v. Beitel, supra. The cause of action for contribution is in assumpsit, or implied promise to pay, and must be filed within two years after the judgment is paid. Gaines v. Gaines, 119 S.W.2d 427 (Tex.Civ.App.1938, writ ref’d n. r. e.).

A surety (accommodation party) is primarily liable with the principal (maker) to the payee because he lends his name to the note as security. Reed v. Buck, 370 S.W.2d 867 (Tex.1963); Clark, Suretyship in the Uniform Commercial Code, 46 Texas L.Rev. 453 (1968). Nevertheless, the rights and obligations of a surety are different from those of a principal. One important difference as related to the ease at bar is that if the surety pays the judgment he stands in the shoes of the creditor and may sue on the judgment itself. Fox v. Kroeger, 119 Tex. 511, 35 S.W.2d 679 (1931); Tex.Bus. & Comm.Code Ann. § 34.04 (1968).

Caldwell had the burden of proving suretyship. Culberson v. Hawkins, 321 S.W.2d 140 (Tex.Civ.App.1959, no writ). His burden was onerous since it is presumed that one signs as a co-maker unless the suretyship relationship between the co-signers appears on the face of the note. Durham v. McDowell, 265 S.W. 425 (Tex.Civ.App.1924, no writ); Breckenridge Hotel Co. v. Radford Grocery Co., 35 S.W.2d 464 (Tex.Civ.App.1931, no writ). Caldwell did nothing to rebut that presumption. For example, Caldwell did not make the note a part of his summary judgment proof. As a result this Court cannot ascertain whether a surety relationship between Caldwell and the co-signers appeared on the face of the note.

There is a second reason for affirmance of the judgment. An examination of Caldwell’s summary judgment proof demonstrates that he did not plead in the 1966 suit that he signed the note as surety. The 1966 judgment does not show that Caldwell acted as surety in signing the note. Accordingly, Caldwell was not entitled in the summary judgment proceeding to have the court determine an issue which could have been properly determined in the 1966 trial. Vollmer v. Roscoe, 201 S.W.2d 71 (Tex.Civ.App.1947, no writ); Tarlton v. Orr, 40 Tex. Civ.App. 410, 90 S.W. 534, 536 (writ ref’d).

This Court, therefore, will presume that Caldwell signed the note as principal or co-maker. His cause of action is one in assumpsit barred by the two-year statute of limitations at the time Caldwell filed suit.

The judgment is affirmed.

Affirmed.


author: RALEIGH BROWN, Justice.

text:
    Clarence Gayle GARNER, Appellant, v. Nell M. GARNER, Appellee.
    No. 5134.
    Court of Civil Appeals of Texas, Eastland.
    June 15, 1978.
    Rehearing Denied July 6, 1978.
    Richard D. Coan; Coan. Allen & Terrill, Stephenville, for appellant.
    Keith Woodley; Sudderth, Woodley & Dudley, Comanche, for appellee.
   RALEIGH BROWN, Justice.

Nell M. Garner sued Clarence Gayle Garner seeking divorce and division of property. Following a nonjury trial, the court entered its judgment divorcing the parties and dividing the property. Clarence Gayle Garner appeals. We dismiss the appeal.

In this appeal, appellant seeks to set aside that portion of the judgment relating to a personal judgment over and against him for $10,700. He states specifically, “No appeal is intended as to the divorce itself nor to any other matters involving the community property of the parties.” This demonstrates that appellant has accepted certain benefits under the judgment as to the division of the property.

As a general rule, an appealing party cannot treat an inseverable portion of a judgment as both right and wrong, and if he has voluntarily accepted the benefits of the judgment, he cannot thereafter prosecute an appeal. Carle v. Carle, 149 Tex. 469, 234 S.W.2d 1002 (1950).

The appropriate rule was applied in Trader v. Trader, 531 S.W.2d 189 (Tex.Civ.App.—San Antonio 1975, writ dism’d), wherein the court said:

“We conclude that complaint may 'not be limited to the trial court’s action with regard to one part of property division where other parts are accepted as the property division must be considered as a whole ...”

See also: Roye v. Roye, 531 S.W.2d 242 (Tex.Civ.App.—Tyler 1975, no writ); Clark v. Clark, 362 S.W.2d 655 (Tex.Civ.App.-Houston 1962, no writ); Nixon v. Nixon, 348 S.W.2d 438 (Tex.Civ.App.—Houston 1961, writ dism’d).

The appeal is dismissed.

Cite as 567 S.W.2d 283


author: REED, Justice.

text:
    Frank D. THOMAS, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Supreme Court of Kentucky.
    April 11, 1978.
    As Modified June 13, 1978.
    Richard L. Receveur, Asst. Public Defender, Louisville, for appellant.
    Robert F. Stephens, Atty. Gen., Mark F. Armstrong, Asst. Atty. Gen., Frankfort, for appellee.
   REED, Justice.

Frank D. Thomas was convicted by a jury of one count of kidnapping (KRS 509.040) and two counts of wanton endangerment in the first degree (KRS 508.060). Punishment was fixed at eleven years’ confinement on the kidnapping charge, four years on one of the wanton endangerment charges and five years on the other wanton endangerment charge. The trial judge entered judgment in accordance with the jury’s verdict and also provided that the sentences run consecutively. Thomas appeals.

The Attorney General candidly concedes that the trial judge’s instructions to the jury were prejudicially erroneous in two particulars. Therefore, the judgment will have to be reversed and a new trial ordered. We are concerned with a more fundamental problem presented by this case, which we will discuss later in this opinion.

On September 25, 1976, Jerry Trammel was driving his car in Louisville. At the corner of 18th and Broadway, he stopped for a red light. Thomas flourished a .38 caliber pistol and forced his way into the car. He said he wanted to kill somebody and told Trammel “to drive, just drive.” For the next hour Thomas caused Trammel to drive in rather aimless fashion. He held the pistol to Trammel’s side. He ordered Trammel to stop at the Home of the Innocents; he told Trammel he had killed somebody there. Here, he switched places in the front seat of the car with Trammel but returned Trammel to the driver’s seat after about five minutes and ordered him to start the car and continue driving.

Later, as Trammel was driving, he saw a police car. He swerved over and hit it. Officers Fey and Watts were in the police car. Officer Watts testified that Trammel rolled out of the car and yelled that Thomas had a pistol. Watts told Trammel to lie still on the ground. As Watts approached the car, he saw Thomas standing beside the passenger door holding . a pistol. Watts drew his gun, cocked it and pointed it across the hood of the car at Thomas and ordered him to put the pistol down. Thomas brought the gun up in Watts’ direction, but after a second warning he dropped the pistol on the seat of the car. From Watts’ examination at the scene, it was established that the pistol was unloaded and that Thomas had no bullets with him.

The indictment on which Thomas was tried in alleging kidnapping read in pertinent part:

“Count One
That on or about the 15th day of September, 1976, in Jefferson County, Kentucky, the above named defendant committed the offense of kidnapping by unlawfully restraining Jerry Trammel against his will, when his intent was to accomplish or to advance the commission of a felony, first-degree wanton endangerment.”

Count two of the indictment charged Thomas with the commission of “first-degree wanton endangerment when, under circumstances manifesting extreme indifference to the'value of human life, he wantonly engaged in conduct which created a substantial danger of death or serious physical injury to Jerry Trammel by threatening to kill him with a pistol.” (Emphasis supplied). Count three repeated the same language in charging a separate and additional offense of first-degree wanton endangerment committed against Officer Watts.

Thomas moved the trial court to dismiss counts one and two as “duplications” and to dismiss count three because it was the result of prosecutorial vindictiveness when plea bargain negotiations failed. The trial judge properly denied this pretrial motion to dismiss. Counts one arid two as pleaded were not “duplications” and the contention of Thomas so far as the addition of count three is concerned was decided adversely to him in Bordenkircher v. Hayes, 434 U.S. 357, 98 S.Ct. 663, 54 L.Ed.2d 604 (1978).

At the conclusion of the Commonwealth’s evidence, Thomas moved for a directed verdict of acquittal as to each count of the indictment. At the conclusion of all the evidence, he again moved for a directed verdict as to each count. The trial judge denied the motions. Thomas specifically objected to the instructions given. The sufficiency of the evidence and the validity of the instructions are reviewable on appeal.

We will first consider the prosecution’s evidence so far as the wanton endangerment charges are concerned. “A person is guilty of wanton endangerment in the first degree when, under circumstances manifesting extreme indifference to the value of human life, he wantonly engages in conduct which creates a substantial danger of death or serious physical injury- to another person.” KRS 508.060(1). This offense is a Class D felony. “A person is guilty of wanton endangerment in the second degree when he wantonly engages in conduct which creates a substantial danger of physical injury to another person.” KRS 508.-070(1). This offense is a Class A misdemeanor.

“Illustrative types of conduct which can be sufficient to support a conviction of this offense are . . . (ii) a grossly careless use of firearms or explosives; (iii) the flourishing of a deadly weapon in public; etc.” 1 Palmore and Lawson, Instructions to Juries in Kentucky, Sec. 2.21, p. 78. Thomas clearly intended to convince Trammel and Watts that his pistol was capable of causing death or other serious physical injury and Trammel and Watts appeared to be so convinced. On this occasion the pistol was a deadly weapon even if it was inoperable. See Merritt v. Commonwealth, Ky., 386 S.W.2d 727 (1965); Kennedy v. Commonwealth, Ky., 544 S.W.2d 219 (1976); Bishop v. Commonwealth, Ky., 549 S.W.2d 519 (1977). The conduct of Thomas clearly could have caused Trammel or Watts or others who perceived his conduct to engage in actions which would create a substantial danger of death, serious physical injury or physical injury, e. g., the action of Trammel in driving his car into the police cruiser. Thomas’ assertion that because the pistol was inoperable he was not guilty of wanton endangerment is rejected. The trial court, however, should have instructed the jury on second-degree wanton endangerment as to both counts two and three, and this is conceded by the Attorney General.

As to the detention of Trammel by Thomas, the Attorney General concedes that the trial court erred in not instructing on both first and second degree unlawful imprisonment, but argues that the kidnapping charge contained in count one was properly submitted to the jury. We agree that the jury should have been instructed on both degrees of unlawful imprisonment, but we are persuaded that Thomas was entitled to a directed verdict on the kidnapping count under the language of the indictment.

“A person is guilty of unlawful imprisonment in the first degree when he knowingly and unlawfully restrains another person under circumstances which expose that person to a risk of serious injury.” KRS 509.-020(1). This offense is a Class D felony. “A person is guilty of unlawful imprisonment in the second degree when he knowingly and unlawfully restrains another person.” KRS 509.030(1). This offense is a Class D misdemeanor.

There can be no doubt that the prosecution’s evidence adequately supported instructions on unlawful imprisonment of Trammel by Thomas. Unlawful imprisonment is the basic and lesser offense and kidnapping is an aggravated form of unlawful imprisonment where detention of a victim is shown.

KRS 509.040 declares that kidnapping is unlawful restraint of another person with the intent

(a) To hold him for ransom or reward; or
(b) To accomplish or to advance the commission of a felony; or
(c) To inflict bodily injury or to terrorize the victim or another; or
(d) To interfere with the performance of a governmental or political function; or
(e) To use the victim as a shield or hostage.

The indictment instead of charging that the intentional objectives of Thomas in his restraint of Trammel were to terrorize or to inflict bodily injury on Trammel, as the prosecution’s evidence appeared to establish, specifically charged that the intentional objective of Thomas on the occasion in question was “to accomplish or to advance the commission of a felony: first-degree wanton endangerment.”

The instruction on kidnapping given by the trial court permitted a guilty verdict if the jury believed that the intentional objective of Thomas was to accomplish or advance the commission of “a felony.” The felony was unnamed or the conduct constituting it was undescribed and the term “felony” was undefined. A proper instruction may be found in 1 Palmore and Lawson, Kentucky Instructions to Juries, Sec. 2.25(l)(c) p. 80. In any event, the instruction on kidnapping given by the trial court was prejudicially erroneous.

The element in this case that concerns us more than the other problems presented is the basis of the indictment on the kidnapping count. The kidnapping statute requires a specific intent to accomplish any one of several specified objectives. One of these is to accomplish or advance the commission of a felony. The felony of first-degree wanton endangerment was the offense the indictment charged that Thomas was intending to accomplish or advance by his restraint of Trammel. How can one intend to engage in wanton conduct? As the commentary to the Penal Code points out: “In other words a person cannot intend to act “wantonly” or “recklessly” toward a result . . . ” KRS 508.060 Commentary (1974). We must conclude that the “felony” referred to in the kidnapping statute, KRS 509.040(l)(b) is one requiring “intentional” or “knowing” states of mental culpability as those terms are defined in KRS 501.020.

It is pur conclusion that upon retrial under the indictment as it presently reads and if the evidence be substantially the same, the trial court should instruct on unlawful imprisonment in the first and second degrees and on wanton endangerment in the first and second degrees so far as the incidents involving. Trammel are concerned, and on wanton endangerment in both first and second degree so far as the incident involving Officer Watts is concerned.

The judgment is reversed for new trial.

All concur.


author: JONES, Justice.

text:
    John McD. ROSS et al., Movants, v. GREENE & WEBB LUMBER CO., INC., Respondent.
    Supreme Court of Kentucky.
    May 23, 1978.

      William S. Riley, William P. Sturm, Dept, of Revenue, Frankfort, for movants.
    Ronald G. Polly, Gene Smallwood, Jr., Polly, Craft & Asher, Whitesburg, for respondent.
   JONES, Justice.

This appeal arises from the action of the Kentucky Department of Revenue which assessed Greene & Webb Lumber Company, Inc., the sum of $5,438.40 in sales and use tax under KRS 139.170. The assessment was based on the lumber company’s purchase of certain items of equipment which the Department of Revenue contends do not qualify for exemption as machinery for new and expanded industry under KRS 139.480(8) and KRS 139.170.

Greene & Webb Lumber Company, Inc., conducts its business in Letcher County as a sawmill and lumberyard. A number of items of equipment were installed and used by it in its business during the years 1967, 1968 and 1969. The trial court found a number of items exempt as machinery for new and expanded industry under KRS 139.480(8) and KRS 139.170. The Kentucky Department of Revenue appealed to the Court of Appeals of Kentucky. In an opinion the Court of Appeals affirmed the trial court. The Kentucky Department of Revenue filed a motion for discretionary review, which was granted. It contends that the Court of Appeals erroneously held that 15 items are used directly in the manufacturing process and therefore are entitled to the exemption allowed by the statute.

The question presented is whether certain items used in a sawmill operation are exempt from Kentucky sales and use tax under KRS 139.480(8) as “machinery used for new and expanded industry.” This question turns on whether the items purchased by the lumber company are used directly in the manufacturing process so as to be within the definition of KRS 139.170 and eligible for the exemption. In order that the issue be resolved, a determination must be made as to when the manufacturing process begins and ends in the operation of a sawmill.

The Department is in error when it argues that this court has not adopted the “integrated plant concept.” Nothing could demonstrate more clearly this court’s position than its opinion in Schenley Distillers, Inc. v. Commonwealth ex rel Luckett, Ky., 467 S.W.2d 598 (1971). Schenley, supra, dealt with the bottling of whiskey which this court noted was a continuing process with empty bottles moving on a conveyor belt through the filling procedure. The Board of Tax Appeals held the conveyor taxable because it was viewed as preceding the manufacturing process. This court held otherwise, citing Niagra Mohawk Power Corporation v. Wanamaker, 286 App.Div. 446, 144 N.Y.S.2d 458 (1955). In Schenley, supra, this court said of Niagra, supra:

“It was held that the process was synchronized and integrated and that the words ‘directly and exclusively’ should not be construed to require the breakdown of the manufacturing process into distinct stages. So here.” Schenley, supra, at 599.

The court further applied the reasoning in Magra, supra, to the conveyor system in the Schenley case, supra:

“The conveyor system here involved, from beginning to end, is an integrated part of the production process and the first movement is as essential as the last. The machinery is clearly ‘used directly in the manufacturing process’ and is tax exempt.” Schenley, supra, at 600.

The process of turning logs into lumber is comparable to the bottling procedure in Schenley. Prior to the operation of a sawmill, timber is cut and transformed into logs. The logs are taken to the sawmill and placed in stacks. They are moved from the stacks to a conveyor which carries them on to a debarker. After the logs are squared, the slabs are conveyed to a chipper, which produces pulp chips. The squared logs are then sawed into rough lumber and moved to stacking sheds for air-drying. Waste material, such as unused slabs, bark and dust, are conveyed to a refuse burner. The operation of the mill also entails the maintenance and repair of saws, chippers, and other equipment. This court is of the opinion that the manufacturing process in this case begins when the logs are taken from the stacks and moved onto the conveyor. The manufacturing process ends after the lumber is air-dried so that it is marketable. Under the “integrated plant” theory the whole procedure in the operation of the sawmill constituted manufacturing.

The trial court looked to the legislative intent to determine the exemption of items used in the manufacturing process, and in so doing, gave a good definition of the manufacturing process when he stated:

“To conform to the legislative intent the manufacturing process should begin when the raw material (logs here) starts moving in a chain of unbroken, integrated sequence into the plant or mill and ends with a generally accepted saleable product. The machinery necessary and exclusively used in this chain should make up the machinery used directly in the manufacturing process.”

This court does not accept the Department’s theory that the “integrated plant theory is not and should not be the law in Kentucky.” It is obvious that the legislative intent in enacting the exemption statute was to enhance Kentucky’s competitive position in manufacturing.

The Court of Appeals of Kentucky concluded:

“The beginning product- is a log and the end product is marketable rough-sawed lumber or pulp and the entire process occurs on the sawmill yard.”

This court is of the view that all of the items held exempt by the trial court and the Court of Appeals constituted equipment used at the sawmill to carry logs to the conveyors and to transfer the lumber to the drying sheds, and are essential to the total process of manufacturing. All the items are therefore exempt as being “directly used in the manufacturing process.”

The judgment of the Court of Appeals is affirmed.

All concur.


author: STERNBERG, Justice.

text:
    Ronnie SMITH, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Supreme Court of Kentucky.
    June 13, 1978.

      Jack E. Farley, Public Advocate, M. Gail Robinson, Asst. Public Defender, Frankfort, for appellant.
    Robert F. Stephens, Atty. Gen., Martin Glazer, Asst. Atty. Gen., Frankfort, for ap-pellee.
   STERNBERG, Justice.

This is an appeal from a judgment of the Breathitt Circuit Court finding the appellant guilty of murder and fixing his punishment at life in the penitentiary. In January, 1977, the appellant and his cohort, Clyde Watkins, who are first cousins, killed Richard Hicks and dumped his body down a coal tipple chute. The appellant pled not guilty. On August 15, 1977, the day of trial, appellant withdrew his not-guilty plea and entered a plea of guilty. The Commonwealth’s Attorney requested that the penalty be fixed by a jury. No objection was made by counsel for appellant, and the court proceeded to impanel a jury for that purpose. Counsel for appellant made his statement to the jury. Thereafter, counsel for the Commonwealth made his presentation to the jury. The jury retired to the jury room for deliberation and, thereafter, returned to the courtroom with a verdict fixing the appellant’s penalty at life imprisonment.

On August 18, 1977, counsel for appellant filed a motion and grounds for new trial, which was overruled, and on September 13, 1977, judgment was entered. On September 23, 1977, the appellant filed a notice of appeal to the Court of Appeals of Kentucky. It should have been to the Supreme Court of Kentucky, not to the Court of Appeals. Ky.Const. § 110(2)(b). We have decided to waive the error and take jurisdiction. Two alleged errors are set out in the motion and grounds for a new trial. First, the appellant charges that the life sentence imposed by the jury is cruel and unusual considering his age and his guilty plea, and secondly, he charges that the court did not properly arrange the arguments of counsel pursuant to the guilty plea. Neither of these alleged errors has been presented on this appeal; consequently, they will be deemed to have been waived. RAP 1.260; Gaddie v. Price, Ky., 528 S.W.2d 708 (1975).

On this appeal the appellant argues that the record does not reflect that his plea of guilty was voluntary and intelligently made and that the record does not reflect that he made a knowing waiver of his constitutional rights of confrontation and privilege against compulsory self-incrimination. We note that the allegations of error, as set out in appellant’s brief, carefully charge that the record does not reflect that he was properly advised of his constitutional rights before his plea of guilty was received by the trial court. The appellant does not state that the trial judge did not, in truth and in fact, advise him of these rights, merely that the record does not reflect that it was done. Regardless of whether the court adequately advised the appellant of his constitutional rights, we are faced with the proposition that at no time did the appellant complain to the trial court or request that his guilty plea be withdrawn and his plea of not guilty be reinstated. The propriety of the trial court in permitting the withdrawal of appellant’s plea of not guilty and in accepting his guilty plea should have been raised in the lower court and the judge afforded an opportunity to pass on the issue. The trial judge was exceedingly cooperative with the appellant, and it is not beyond cavil that had the appellant sought to withdraw his plea of guilty even after the jury returned its verdict, his motion may have been granted. Granted or not, it would have been given much consideration by the learned trial judge. Therefore, with respect to these alleged errors, it is sufficient answer to say that the trial court was not afforded an opportunity to correct the errors, if any; consequently, this court cannot consider them. Cole v. Commonwealth, Ky., 553 S.W.2d 468 (1977).

The appellant argues that the trial court erred in not conducting a competency hearing. On March 21, 1977, the appellant was arraigned and pled not guilty. His motion for a psychiatric examination to establish whether he was competent to stand trial was granted. The report dated March 24, 1977, sets out that the appellant is “depressed and would recommend that he be further observed and treated in an appropriate facility for better assessment of his condition.” On March 25, 1977, the appellant moved the court for further psychiatric examination, which also was granted. This report, which is dated May 2 and filed on May 3, 1977, discloses that the appellant is competent to stand trial. His discharge summary contains the following statement: “Physical examination was normal and all laboratory tests were reported within normal limits.” It goes on to say that the appellant “is not suffering from mental disease or defect, he is not psychotic, he is well aware of the charge against him, understands the court proceedings and is competent to stand trial and aid in his defense.”

It appears that the trial court extended every opportunity to the appellant in his effort to establish incompetency to stand trial. The trial court, at the time of trial, was not requested to make any determination of appellant’s mental capacity to stand trial, and the record does not reflect any facts that would in and of themselves authorize the court to entertain or conduct a competency hearing. We have long followed the criterion that reasonable grounds must be called to the attention of the trial court by the defendant or must be so obvious that the trial court cannot fail to be aware of them. The record does not reflect such an obvious situation. Huff v. Commonwealth, Ky., 560 S.W.2d 544 (1977).

Further, the appellant contends that his right of confrontation and due process was violated when the Commonwealth’s Attorney stated the evidence to the jury without calling any witnesses. The record reflects that this mode of proceeding was agreed upon by counsel for the Commonwealth and counsel for the appellant. At the time of trial the appellant made no objection to this order of procedure; consequently, it cannot now be brought before this court for consideration. The record reflects that on September 13, 1977, when the trial judge, in the course of his sentencing the appellant, asked the appellant if he had any lawful reason to show why judgment should not be pronounced against him, Mr. Kelly, his attorney, reminded the court that one of the grounds set out in the motion for a new trial was based upon the alleged irregularity in the sequence of presentations to the jury. At that time counsel for appellant moved the court to set aside the sentence and to conduct a trial before a new jury for the purpose of having the sentence fixed. As heretofore pointed out, the motion and grounds for a new trial was overruled by the court. This issue has not been presented for appellate review.

Appellant complains that the Commonwealth’s Attorney made an inflammatory argument while stating the evidence. The transcript of the statements made by the Commonwealth’s Attorney does not show any of them to be inflammatory. However, no objection was made at the time of the presentation by the Commonwealth’s Attorney; consequently, it has not been preserved for appellate review by this court. Luckett v. Commonwealth, Ky., 550 S.W.2d 517 (1977).

(6] Next, the appellant charges that he was deprived of effective assistance of counsel. This complaint was not presented to the trial court; consequently, it has not been preserved for appellate review. Huff v. Commonwealth, supra.

Contention is made by the appellant that the trial court failed to follow KRS 532.050 and 533.010 in his sentencing procedure. The record does not bear out this contention. On the contrary, the record does disclose that the proper sentencing procedure was followed.

The judgment is affirmed.

All concur, except STEPHENSON, J., who concurs in result only.


author: REED, Justice. JONES, Justice,

text:
    Clarsie Jane RATLIFF, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Supreme Court of Kentucky.
    June 13, 1978.

      Jack Emory Farley, Public Defender, Rodney McDaniel, Asst. Public Defender, Frankfort, for appellant.
    Robert F. Stephens, Atty. Gen., J. Gerald Henry, Asst. Atty. Gen., Frankfort, for ap-pellee.
   REED, Justice.

The appellant, Clarsie Jane Ratliff, was convicted of murder and sentenced to 20 years’ confinement. Asserting several grounds for reversal, she appeals. We find it necessary to deal with only two of them.

The Public Defender’s assertion that the trial judge erred in not postponing the trial and conducting a hearing to determine appellant’s competency to stand trial is clearly refuted by the record. The truth is that the trial judge showed commendable concern. He had the appellant examined as to her mental competency on his own motion; he held a due process evidentiary hearing on the issue; he found she was not competent to stand trial. Sometime later her attorney (a member of the Public Defender’s state staff) requested that she be tried and her psychiatrist certified in writing that she was then competent to stand trial. The trial judge acceded to the requests of appellant’s counsel and her psychiatrist who attended the trial. Appellate counsel do nothing to establish credibility with the court by claiming error in such circumstances. This claim of error is specifically rejected.

This court has concluded that appellant in the context presented sufficiently objected to the instructions of the trial judge to the jury to preserve the question of their validity for consideration on appeal. We have decided that appellant was entitled to an instruction on first degree manslaughter as her attorney requested in the trial court. The trial judge committed prejudicial error when he failed to so instruct and thereby to allow the jury to consider the existence of the mitigating influence of extreme emotional disturbance rather than confining their inquiry solely to the existence of the completely exculpating circumstance of mental disease or defect to the high degree of legal insanity at the time of the commission of the offense.

Under the indictment and the evidence, the situation presented was one which in the past would have been labeled as wilful murder with a defense of legal insanity. Today, however, under our Penal Code, the possible offenses are defined by statute. KRS 507.020 defines murder as an intentional killing where the defendant is not acting under the influence of extreme emotional disturbance for which there was a reasonable explanation or excuse, the reasonableness of which is to be determined from the viewpoint of a person in the defendant’s situation under the circumstances as the defendant believed them to be. KRS 507.030(l)(b) defines manslaughter in the first degree as the intentional killing of another under circumstances which do not constitute murder because the defendant acts under the influence of extreme emotional disturbance as defined in KRS 507.-020.

On November 1, 1976, appellant traveled to Morehead where she bought a .22 caliber pistol and a box of shells. She returned to Grayson that same day. The next day she went to the Dollar General Store in Gray-son. While in the store, she fatally shot a female clerk. There had been no prior trouble between the victim and the appellant. There were no eyewitnesses to the shooting although a second clerk outside the store arrived in time to see appellant leave. When appellant reached the outside of the store, she fired her pistol again. Two- shots were fired in the direction of a man, an apparent stranger to her, who had just parked his truck near the store entrance. One shot was fired into a store front. After these shots were fired, she proceeded to walk down the street, tossed the gun into a nearby yard and was apprehended immediately thereafter by the police.

The record is replete with evidence of an emotional disturbance which, if believed by the jury, could have served to mitigate the degree of culpability under our present Penal .Code while not rising to the level of legal insanity and complete exculpation.

Two expert psychiatrists testified that appellant suffered from schizophrenia-paranoid type. Both experts agreed that she was very likely psychotic at the time of the shooting and was unable to comprehend what was occurring. The appellant’s own testimony indicated that she was under the delusion that a sizeable number of town’s people led by County Judge McDavid and local policeman Charlie Gilbert had formed a conspiracy to run her out of town.

Appellant believed the store clerk was a conspirator against her. She testified: “. . Charlie Gilbert went up and told that woman at the store, the one I shot; he went up there and told her not to sell me nothing out of the store . . . .” “They watched me, yes, and got smart with me and they acted like they wanted to bother me — the Mullens girl — and there’s another girl come in from across the street, a little black headed girl, and they both got together there and I thought they was going to jump me.” Appellant told state police detective Bellamy, “That lady (the victim) looked at me as if she was going to pull my hair.” Appellant had been on medication and had been visiting the local Comprehensive Care Center for some time prior to the shooting for treatment of her mental condition. If the foregoing evidence would not permit an objective jury to reasonably doubt the absence of extreme emotional disturbance in this case, there is no use having this element expressed in the Penal Code as a circumstance permitting mitigation.

The case of Edwards v. Commonwealth, Ky., 554 S.W.2d 380 (1977) is inapposite. There the issue was whether the defendant was entitled to a directed verdict in her favor on her exculpatory defense of legal insanity. We held that her evidence “. . . completely fails to show that on the [date of the crime], a mental disease or defect had so reduced her mental state that she was unable either to appreciate the criminality of her acts or to resist the impulse to commit the crime.” Id. at 383. In view of this failure of proof, we could find no error in the trial judge’s refusal to grant Edwards the directed verdict of acquittal that she sought.

In the case presently before us, the prosecution carried the burden to satisfy the jury of the absence of extreme emotional disturbance as statutorily defined. The defendant carried the burden to convince the jury that she was legally insane at the time of the commission of the offense. KRS 504.-020. If the jury had a reasonable doubt that the defendant had been proved not to have acted under the influence of extreme emotional disturbance for which there was a reasonable justification or excuse under the circumstances as she believed them to be, the punishment they could otherwise assess for murder could have been mitigated by a finding of first degree manslaughter. Of course, if the defense of legal insanity had been believed by the jury the result would have been complete exculpation and not mitigation of punishment.

In this case, if the evidence on the new trial later directed herein is substantially the same, the trial court should instruct as set forth in Palmore and Lawson, Kentucky Instructions to Juries, Sec. 2.02, pp. 37, 38, 39 and Sec. 10.31, pp. 371, 372. These recommended instructions should be conformed to the evidence, the references to the defense of self protection should be omitted, and the sentence: “The law presumes every man sane until the contrary is shown by the evidence.”, should be omitted from Sec. 10.31. See Mason v. Commonwealth, Ky., 565 S.W.2d 140 (1978) (Rendered April 12, 1978).

We reserve decision on all other issues raised in this appeal.

The judgment is reversed for a new trial consistent with this opinion.

PALMORE, C. J., and CLAYTON and LUKOWSKY, JJ., concur.

JONES, STEPHENSON and STERN-BERG, JJ., dissent.

JONES, Justice,

dissenting.

In my view, Clarsie Jane Ratliff had a fair trial. Under all of the evidence I am of the opinion that the trial court properly instructed the jury. There is not a shred of evidence that Clarsie acted under extreme emotional disturbance.' She calmly and deliberately committed the crime with which she was charged.

I am of the opinion that the trial court showed a great deal of compassion and understanding. Had the public defender not requested a trial and had not the psychiatrist who attended the trial certified that Clarsie was competent to stand trial, perhaps she would not have had a trial. Her counsel and her psychiatrist were so confident that the jury would not convict because of the insanity defense they pressed for a trial, got one, and the jury did what they were supposed to do. The jury gave Clarsie the minimum sentence on murder. It is an exercise in futility to send this case back for another trial with directions that the trial court instruct the jury on first-degree manslaughter.

There is no doubt that Clarsie was suffering from a mental disease. She was classified by a psychiatrist as a schizophrenic paranoid. A psychiatrist testified that she might commit a similar offense again and again. If an iota of evidence existed that Clarsie was acting under extreme emotional disturbance I would join the majority in saying that she was entitled to an instruction on first-degree manslaughter. I do not believe it is the function of this or any appellate court to embark on a crusade to find errors where none exist.

I do not believe the trial court committed prejudicial error in failing to give a first-degree manslaughter instruction in this case. I therefore would affirm the judgment.

For the reasons stated I respectfully dissent.

I am authorized to say that STEPHENSON and STERNBERG, JJ., join in this dissent.


author: COOPER, Judge.

text:
    Floyd ABBOTT, Jr., Appellant, v. John P. MATRANGA, Appellee.
    Court of Appeals of Kentucky.
    June 2, 1978.
    David Patrick, P. S. C., W. A. Wickliffe, Sheehan, Wickliffe, Conover, Barnett & Hays, P. S. C., Harrodsburg, for appellant.
    Richard H. Campbell, Jr., Danville, for appellee.
    Before COOPER, HOWARD and WIL-HOIT, JJ.
   COOPER, Judge.

This is an appeal from a summary judgment in the Boyle Circuit Court giving full faith and credit to a judgment of the courts of the State of Louisiana.

The appellee, John P. Matranga, instituted suit against the appellant, Floyd Abbott, Jr., in the Boyle Circuit Court on October 26, 1976, whereby the appellee sought to enforce a judgment rendered against the appellant and Miss Phyllis McIntosh, jointly and severally, under the date of April 21, 1976, in the civil district court for the Parish of Orleans, State of Louisiana, and in the original amount of Five Thousand Two Hundred Eighty Dollars and Seventy-Four cents ($5,280.74) plus interests and costs. The appellant filed his answer in which he pled satisfaction in full of all sums due the appellee alleged in appellee’s complaint. We interpret this as an allegation that the underlying claim was paid in Louisiana, but not as an assertion that the judgment sought to be enforced has been satisfied. On March 7, 1977, appellee filed an affidavit in support of summary judgment and motion for summary judgment.

The appellee filed a motion to admit the entire record of the proceeding held in the civil district court, Parish of Orleans, State of Louisiana, into evidence on May 27,1977. The said records of the Louisiana court were filed in the court record. The Boyle Circuit Court sustained the appellee’s motion for summary judgment and entered its order and judgment on July 21, 1977.

The only question of law presented on this appeal is as follows:

Was the lower court correct in giving full faith and credit to the judgment of the civil district court, Parish of Orleans, State of Louisiana, pursuant to Article IV, Section I, of the United States Constitution?

The record shows the Louisiana court had, under Louisiana law, jurisdiction over the appellant, Floyd Abbott, Jr. The record of the Louisiana court also clearly shows the appellant was before the Louisiana court and, in fact, a trial was held. Further, the Louisiana record shows an attorney for the appellant entered an appearance, filed an answer, filed motions for continuances, corresponded with the trial court and obtained a trial date in the Louisiana court.

For the Boyle Circuit Court to now allow appellant to challenge the jurisdiction of the Louisiana court clearly constitutes a collateral attack upon the Louisiana judgment, and is improper under Article IV, Section I, of the United States Constitution. In this case, as well as similar cases, the Louisiana judgment is immune to such collateral attack. See Hanshew v. Mullins, Ky., 385 S.W.2d 186 (1964).

The Supreme Court of the United States has stated in the case of Durfee v. Duke, 375 U.S. 106, on page 111, 84 S.Ct. 242, on page 245, 11 L.Ed.2d 186, on page 187 (1963), that:

While a court in one state, when asked to give effect to the judgment of the court in another state, may constitutionally inquire into the foreign court’s jurisdiction to render that judgment, the judgment is entitled to full faith and credit, even as to questions of jurisdiction over the person and jurisdiction over the subject matter, when the second court’s inquiry discloses that those questions have been fully and fairly litigated and finally decided in the court which rendered the original judgment.

The United States Supreme Court went on to say in the case of May v. Anderson, 345 U.S. 528, 537, 73 S.Ct. 840, 845, 97 L.Ed. 1221 (1953), “The only escape from obedience (with the full faith and credit clause) lies in holding that the judgment rendered in the [sister state] ... is void and entitled to no standing even in the [sister state.] It is void only if it denies due process of law.”

The options and obligations of law are limited, concise and direct. The only permissible scope of inquiry open to the Boyle Circuit Court was to determine from the face of the judgment of the Louisiana court whether that court had jurisdiction over the appellant, Floyd Abbott, Jr.

In summary, as stated earlier, the only question before this Court is whether or not the Boyle Circuit Court was correct in according full faith and credit to the judgment of the civil district court, Parish of Orleans, State of Louisiana. The Boyle Circuit Court had to determine whether or not the Louisiana court had jurisdiction over the appellant. The only place to which the lower court could correctly inquire was to the face of the judgment and record of the Louisiana court. This question is one of law, not of fact, and the lower court possessed the power and authority to resolve such questions. After reviewing the record of the Louisiana court, in accordance with the laws of these United States and of this Commonwealth, the Boyle Circuit Court correctly determined that the Louisiana courts did, in fact, have jurisdiction over the appellant herein. This being the only issue open to the lower court, and that court having resolved said issue in favor of the appellee, summary judgment was correctly entered for the appellee.

The judgment is affirmed.

All concur.


author: HOWARD, Judge.

text:
    Jack H. HAMMONS, d/b/a South Eastern Adjustment Company, Appellant, v. BIG SANDY CLAIMS SERVICE, INC., Appellee.
    Court of Appeals of Kentucky.
    June 9, 1978.

      Robert L. Milby, Hamm, Taylor, Milby & Farmer, London, for appellant.
    Edward R. Hays, Lexington, for appellee.
    Before COOPER, HOWARD and WIL-HOIT, JJ.
   HOWARD, Judge.

The appellant, Jack H. Hammons, d/b/a South Eastern Adjustment Company (hereinafter referred to as Hammons), is an insurance or claims adjuster who worked for appellee, Big Sandy Claims Service, Inc. (hereinafter referred to as Big Sandy). Big Sandy is a claim service that commenced its operations in Pikeville but has since opened offices in several other Kentucky towns. Hammons and Big Sandy entered into an employment contract which included a “noncompetition clause.” This controversy revolves around this clause and the pertinent parts read as follows:

Employee agrees and binds himself that upon termination of his employment with Employer for any reason that he will not, under any circumstances, engage in the adjustment of claims or services rendered in connection therewith, either property damage, fire, personal injury or otherwise, for himself or anyone else, within a radius of 200 miles of any territory being serviced by the Employer at the time of Employee’s termination of service with the Employer. This limitation shall be binding for one year next after the Employee’s termination of service with Employer.
It is agreed and understood that the purpose of this limitation is for the protection of the Employer in that the Employee will have access to all Employer’s clients and connections in relation to its business and, therefore, competition would be detrimental to the Employer. This employment limitation, however, is limited to Employee’s own business or that of competitive business, such as but not limited to, independent adjustment or corporate service but is not meant to intend that Employee cannot be employed as a salaried adjuster for a given company as staff adjuster. Employee recognizes this restriction and agrees to be bound thereby.

After working for Big Sandy in Middles-boro and in Barbourville, Hammons was discharged on January 6,1975. Within two weeks Hammons had opened a claims service in Barbourville and actively solicited business from Big Sandy’s clientele. He was notified by Big Sandy’s attorney to cease and desist but he refused. Suit was brought asking for a temporary and permanent injunction to prohibit Hammons from operating the business and to further enjoin him from operating a claims business within a radius of two hundred miles of the City of Middlesboro, Kentucky for the duration of one (1) year after January 6, 1975, and for other relief.

Trial was had on the injunction part of the case and the trial court found for Big Sandy and permanently enjoined Hammons from operating and engaging in the business of adjusting and servicing insurance claims for insurance companies within the territory and time period referred to in the preceding paragraphs; all other questions being reserved for determination at a later date.

Hammons appeals contending that the contract is void and illegal as being against public policy. It is conceded by Hammons that the restriction in the contract pertaining to the one year period of time is reasonable but he says that the territorial restriction is unreasonable as the contract could be construed to cover several states if you applied the 200 mile radius from each of Big Sandy’s offices. He also says that the trial court erred in reforming the contract in applying the injunction only to the Mid-dlesboro office. We disagree with Ham-mons in regard to both his contentions.

“Generally contracts in restraint of trade are not enforceable where they are unlimited as to both time and space, or as to where they are unlimited as to space but limited as to time, but where such contracts are unlimited as to time but are confined to a reasonable territory they are enforceable.” Calhoun v. Everman, Ky., 242 S.W.2d 100 (1951). Also, it has been held in Kentucky that an agreement in restraint of trade is reasonable if, on consideration of the subject, nature of the business, situation of the parties and circumstances of the particular case, the restriction is such only as to afford fair protection to the interests of the cove-nantee and is not so large as to interfere with the public interests or impose undue hardship on the party restricted. Ceresia v. Mitchell, Ky., 242 S.W.2d 359 (1951).

In this case, Big Sandy had a legitimate concern in protecting itself from the very situation which arose in the case. An adjustment service has to spend much time and money to generate good will among the insurance agencies and companies in the area it serves. A company like Big Sandy is particularly vulnerable to solicitation by employees or former employees of business from its clientele. Hammons, as well as other employees, could use their positions inside the company to undermine Big Sandy’s position with its clients. A covenant, such as the one at bar, not to engage in competition is a valuable business tool and it did not work an undue hardship on Hammons or the public. An insurance adjusting office must depend on a large surrounding area in which to sustain itself in business. It was not an unreasonable restriction by the trial court to restrict his business within 200 miles of Middlesboro when you consider the nature of the business. It is to be born in mind that the covenant herein did not prevent Hammons from working as a staff adjuster (on salary) in the area for any insurance company. He was only restricted from entering into direct competition with Big Sandy for one year.

As to Hammons’ second point, we quote from Williston on Contracts, 4th Edition, § 1660: “Where the covenant as originally drawn has been found too broad, courts have had no difficulty in restricting it to its proper sphere and enforcing it only to that extent.” This rule has been applied in Kentucky. Ceresia v. Mitchell, supra. See also 61 A.L.R.3d 397 for an exhaustive treatise on this subject entitled “enforceability of Contract Not to Compete.”

The trial court, in its sound discretion, limited the application of the territorial limit contained in the contract. This is all Big Sandy asked him to do. As the trial court had legal precedent to so find, we perceive no error.

The judgment is affirmed.

All concur.


author: WINTERSHEIMER, Judge.

text:
    FIRST NATIONAL BANK OF LOUISVILLE, Louisville, Kentucky, Louisville Flying Service, Inc., National Insurance Underwriters, Dean Walters Ford, Inc., Pikeville National Bank and Trust Company, Kentucky Flying Service, Inc., Kentucky Aircraft Finance Corporation, and Shell Oil Company, Appellants, v. FIRST NATIONAL BANK, PRESTONSBURG, Kentucky, Appellee.
    Court of Appeals of Kentucky.
    June 9, 1978.
    Paul C. Combs, Combs & Combs, Pres-tonsburg, for appellant, First Nat. Bank of Louisville.
    Joe Hobson, Prestonsburg, for appellant, Louisville Flying Service, Inc.
    Marshall Davidson, Prestonsburg, for appellants, Nat. Ins. Underwriters, Dean Walters Ford, Inc., and Shell Oil Co.
    William J. Baird, Baird & Baird, Pike-ville, for appellant, Pikeville Nat. Bank & Trust Co.
    James P. Sohan, Louisville, for appellants, Kentucky Flying Service, Inc., and Kentucky Aircraft Finance Corp.
    Clifford B. Latta, Prestonsburg, for ap-pellee.
    Before MARTIN, C. J., and HAYES and WINTERSHEIMER, JJ.
   WINTERSHEIMER, Judge.

This appeal arises from a judgment in favor of the appellee, allowing it to share in probate assets for the purpose of collection of a claim. The record indicates that Dr. Beard died in December 1971, indebted to many creditors. As a creditor, appellee bank filed suit on a secured debt against the estate on November 15, 1972. Thereafter, on December 11, 1972, appellant, First National Bank of Louisville, filed suit to settle the estate, pursuant to KRS 395.-510, making all heirs and known creditors parties-defendant, including the appellee bank. Creditors were served with process and responded to the complaint and to the commissioner’s notice to prove claims, with the exception of the appellee bank, which did not file any pleadings, answer or claim. After a proper commissioner’s hearing for proof of claims, judgment was entered on September 23, 1975, to settle the estate. Appellee had failed to seek an amendment to the judgment and had not appealed. The trial court, on December 21, 1976, approved the administrator’s plan of distribution. On January 7,1977, appellee objected to the distribution and claimed it had a right to share in the estate. The circuit court withheld all payments on the grounds of the appellee’s objection and assigned the case for hearing on the merits of the objection. On May 27, 1977, the trial court entered an order permitting the appellee to share in the distribution of the estate. This appeal followed.

In the circuit court it was agreed by all interested parties that the sole issue was whether the complaint and discovery depositions taken in the appellee’s suit against the Beard estate met the requirements of KRS Chapters 395 and 396, so as to entitle it to share in the estate distribution.

Appellants raise questions of law as follows:

1) Does the complaint and depositions filed in an action other than the action to settle the estate meet the requirements of KRS Chapters 395 and 396?
2) Is it mandatory ■ that the creditors appear and prove their respective claims before a court commissioner?
3) Was the trial court in error when it rendered a final order and judgment upon documents not a part of the case immediately before it and not a part of the record?

Appellants also objected to the trial court’s granting permission to the appellee’s filing of the complaint, deposition and letters of another lawsuit as part of the record on the appeal of this case.

This Court reverses the judgment of the trial court and remands the case so that a judgment may be entered directing the administrator to pay claimants according to the commissioner’s report and to otherwise settle the estate. The appellee is not entitled to share in any of the funds now in the hands of the administrator because it failed to perfect its claim according to the statutes.

The complaint and deposition filed in the action by the Prestonsburg bank against the Beard estate did not meet the requirements of KRS 396.010 and KRS 395.-520, so as to entitle it to share in the estate. The law clearly provides for a verified claim, the appearance before the court commissioner and proof of claims before him, and for any objections to be made by way of exceptions to the commissioner’s report. None of these requirements were met by the appellee. The appellee, by filing a verified complaint in a separate action against the estate, sought only to collect upon a cause of action founded on a secured debt. That suit was not filed as an action to settle the estate.

KRS 395.520 provides a method for all creditors of an estate to prove their claims. Here all of the creditors, except the appel-lee, appeared before the commissioner and proved their respective claims. The commissioner then made his report to the court, which was approved, and judgment was entered thereon in September 1975. There is nothing in the record to indicate that the appellee complied with these requirements in any way.

There is no reason to provide equitable relief for the appellee in this instance since it has not promptly exercised any of the various opportunities available to it for the proper presentation of the claim. Ap-pellee did not respond to the lawsuit to settle the estate in any way, did not respond to the commissioner’s notice and did not take exception to the commissioner’s report. The trial court’s judgment, from which appellants appeal, was based on a complaint and discovery deposition filed in another lawsuit, which documents are not a proper part of this record. The trial court erred in permitting the appellee to file the complaint in the other lawsuit as a part of the record on appeal of this case. Civil Rule 75.08 provides that a record can be corrected only by the adding of materials or the correction of language which arose at the trial, but were omitted from the record by a mistake or oversight. This rule does not permit the correction of mistakes on the part of litigants in presenting their ease before the trial court.

Appellee cites the case of Quin v. Quin, Ky., 259 S.W.2d 23 (1953) to support its position that depositions could be introduced in this situation. Clearly, the Quin, supra, case and this situation is distinguishable, since the deposition referred to in Quin was actually the transcript of evidence taken at the creditor’s hearing before the commissioner in the very same case. Here, appellee seeks to rely on a deposition taken in a separate and distinct lawsuit. The allegations of substantial compliance by the appellee are without merit, since there is no evidence of any legitimate compliance which amounts to being substantial. The appellee availed itself of none of the remedies.

The judgment of the trial court is reversed and this case remanded with instructions to enter a judgment directing the administrator to pay the claimants according to his report to settle the Beard estate. The appellee is not entitled to share in any of the funds now in the hands of the administrator because of its failure to perfect its claim according to the statutes relating to decedent’s estate.

All concur.