author: JAMES, Justice. HALL, Justice McDONALD, Chief Justice

text:
    JOHN B. MAY & COMPANY, INC., Appellant, v. ACCU-NAMICS, INC., Appellee.
    No. 5479.
    Court of Civil Appeals of Texas, Waco.
    Oct. 16, 1975.

      Crenshaw, Dupree & Milam, Lubbock, for appellant.
    Anderson, Edwards & Warnick, Lubbock, for appellee.
   OPINION

JAMES, Justice.

This is a venue case under Subdivision 27 of Article 1995, Vernon’s Texas Civil Statutes. It is an appeal by one of the defendants, John B. May & Co., Inc., from an order overruling its plea of privilege to be sued in Tarrant County, Texas, the county of Defendant-Appellant’s asserted residence in Texas.

Suit for property damage was filed by Plaintiff-Appellee Accu-Namics, Inc., in Lubbock County, Texas, against Pickens-Bond Construction Co., and Appellant, John B. May & Co., as Defendants. Plaintiff alleged that in October of 1971 it was laying an underground sewer pipeline for the City of Lubbock along 58th Street adjacent to the South Plains Mall construction project. Plaintiff alleged that Defendant Pickens-Bond was the general contractor for the construction of the South Plains Mall, and Defendant-Appellant John B. May was engaged in laying sewer lines to serve the Dillard Building, which was a part of the Mall. Plaintiff alleged that Defendants negligently connected the lines from the South Plains Mall into the ditch in which Plaintiff was laying its sewer line and negligently diverted water into Plaintiff’s ditch and line, resulting in damage to Plaintiff’s ditch and line.

Defendant Pickens-Bond had not filed an answer to Plaintiff’s suit at the time of the venue hearing.

Defendant-Appellant John B. May and Co., filed its plea of privilege to be sued in Tarrant County, Texas, wherein it alleged its residence and principal place of business in Texas to be located. Thereupon Plaintiff-Appellee Accu-Namics filed its controverting affidavit, alleging that venue was maintainable in Lubbock County, Texas, under Subdivisions 9a, 23 and 27 of Article 1995.

After hearing on the venue matter, the trial court overruled Defendant May’s plea of privilege, from which it appeals on eleven points of error. We affirm the trial court’s judgment.

Since we are of the opinion that the case must be affirmed under Subdivision 27 of Article 1995, we will discuss only those of Appellant’s points of error bearing upon the appropriate portion of Subdivision 27.

Defendant-Appellant John B. May, Inc., is admittedly a foreign corporation with a license to do business in the State of Texas. The pertinent portion of Subdivision 27 reads:

“Foreign corporation— * * * may be sued in any county * * * where such company may have an agency or representative * *

Defendant-Appellant May asserts that Plaintiff failed to plead and prove that Defendant-Appellant May had an agent or representative in Lubbock County. We overrule these contentions.

Insofar as the Plaintiff’s pleadings are concerned, without detailing same, suffice it to say that Plaintiff’s controverting plea among other things alleged that Defendant May was a foreign corporation and that its agent in Lubbock County, Texas, at all pertinent times was R. E. Myers, and that Plaintiff’s suit was lawfully maintainable in Lubbock County, Texas, under Subdivision 27 of Article 1995. Defendant levelled no special exceptions to such pleadings. Such pleadings are in our opinion ample to put Defendant May on notice of Plaintiff’s contentions.

With respect to Defendant May’s assertion of Plaintiff’s lack of proof, the record shows that Plaintiff introduced in evidence written interrogatories propounded to Defendant May and the answers in response thereto. This proof showed that Defendant May was a corporation organized under the laws of the State of Arkansas and incorporated for the purpose of mechanical contracting; that Defendant May was engaged in the South Plains Mall area in Lubbock County, Texas, at the time in question in a mechanical contract. It (May) had a subcontract with Pickens-Bond Construction Co., to furnish part of the material for the construction of a building in the South Plains Mall area; that none of the work was completed but the construction of the underground sewer system was in progress. The proof further showed R. E. Myers was Defendant May’s authorized representative in the prosecution of the work conducted on Defendant’s worksite at the time in question, and that his official designation was that of “General Superintendent.” The interrogatories were signed, “Robert E. Myers.”

Our Supreme Court in Milligan v. Southern Express, Inc., (1952) 151 Tex. 315, 250 S.W.2d 194, concerned with the “agency or representative” problem within the meaning of Subdivision 23 of Article 1995 (suits against private corporations) defined “agency or representative” as follows: “_ the statute refers to a situation in which the business of the defendant is, in more or less regular and permanent form, actually conducted in the county of suit, or one in which a party possessing broad powers from the defendant resides in the county, the one instance being that of ‘agency’ and the other of ‘representative.’ ”

Plaintiff’s pleading and proof unquestionably meets the test under Subdivision 27 to maintain venue of the cause against Defendant-Appellant May in Lubbock County, Texas. Judgment of the trial court is accordingly affirmed.

Affirmed.

HALL, Justice

(concurring).

The terms “agency or representative” in subdivisions 23 and 27, of article 1995, Vernon’s Tex.Civ.St., refer to situations “in which the business of the defendant is, in more or less regular and permanent form, actually conducted in the county of suit, or one in which a party possessing broad powers from the defendant resides in the county, the one instance being that of ‘agency’ and the other of ‘representative.’ ” Milligan v. Southern Express, 151 Tex. 315, 250 S.W.2d 194, 198 (1952).

The defendant is a resident of Tarrant County. The only evidence relating to the defendant’s business activity at anytime in Lubbock County is testimony that it was engaged at the time in question in “mechanical contracting” as a subcontractor in the construction of a shopping mall, which included the laying of an underground sewer system for part of the mall; that the sewer line construction was in progress; and that nothing was completed. This is not evidence that the business of the defendant is conducted in Lubbock County “in more or less regular and permanent form” as required for an “agency” under the ruling in Milligan, ante, and it will not reasonably support an inference to that effect. If the majority holds that the defendant’s general superintendent is a “representative” within the meaning of the venue statute, then I disagree. There is no evidence that the superintendent is a resident of Lubbock County, as required by Milligan. For these reasons, I respectfully dissent from the majority’s decision that venue can be maintained in Lubbock County under the provisions of subdivision 27 of Article 1995.

However, I am convinced that the evidence (which need not be detailed) is legally and factually sufficient to support the implied findings of the trial court that the defendant connected a sewer line draining the mall area onto another line, resulting in a subsequent flooding of the plaintiff’s work site; and that in the light of all of the circumstances of record this was negligence and a proximate, foreseeable cause of damage to the plaintiff. These findings support the order holding venue in the county of suit under the provisions of both subdivisions 9a and 23 of Article 1995. For these reasons I agree that the judgment should be affirmed.

McDONALD, Chief Justice

(concurring).

I concur with Justice James that venue is maintainable in Lubbock County under Subdivision 27, Article 1995; and I concur with Justice Hall that venue is maintainable in Lubbock County under Subdivisions 9a and 23, Article 1995.

      .9a. Negligence. — A suit based upon negligence per se, negligence at common law or any form of negligence, active or passive, may be brought in the county where the act or omission of negligence occurred or in the county where the defendant has his domicile. The venue facts necessary for plaintiff to establish by the preponderance of the evidence to sustain venue in a county other than the county of defendant’s residence are:
      1. That an act or omission of negligence occurred in the county where suit was filed.
      2. That such act or omission was that of the defendant, in person, or that of his servant, agent or representative acting within the scope of his employment.
      3. That such negligence was a proximate cause of plaintiffs injuries.

      . 23. Corporations and associations.— Suits against a private corporation . may be brought in the county ... in which the cause of action or a part thereof arose .


source: Caselaw Access Project

author: HALL, Justice.

license: Public Domain

text:
    T.I.M.E.—DC, INC., Appellant, v. SOUTHWESTERN HISTORICAL WAX MUSEUM CORPORATION, Appellee.
    No. 5457.
    Court of Civil Appeals of Texas, Waco.
    Oct. 16, 1975.

      Clifford, Sims & Kidd, Lubbock, for appellant.
    Melton, Curtis & Shaw, Dallas, for appel-lee.
   HALL, Justice.

This is an action by a consignee, Southwestern Historical Way Museum Corp., against a common motor freight carrier, T.I.M.E. — DC, Inc., for damage to a wax figure of an Indian Chief allegedly caused by the carrier, and for attorneys’ fees. Trial to the court without a jury resulted in a judgment that the plaintiff recover $1,000 for damage to the wax figure and $350 for attorneys’ fees.

The defendant delivered the wax figure from the manufacturer, in Vancouver, British Columbia, Canada, to the plaintiff’s museum at Grand Prairie, Texas. The figure was concealed in a wooden crate. Upon receipt of the crate, the defendant executed a bill of lading in which it is stated that it received the crate “in apparent good order, except as noted (contents and condition of contents of packages unknown).” No exceptions were noted on the bill of lading. When the crate was opened at the museum, the figure was found to be irreparably broken at the neck, a shoulder, and an arm. It cannot be used in this condition.

In three points of error the defendant asserts (1) there is no evidence that the wax figure was not damaged when it was delivered to the defendant and no evidence to support the trial court’s express finding that the defendant’s driver caused the damage; (2) the plaintiff was not entitled to attorneys’ fees because this shipment was an interstate shipment; and (3) there is no evidence to support the award of attorneys’ fees.

The plaintiff’s executive vice-president, Lee Clisbee, was present when the crate was delivered to the museum, and when it was opened. He testified as follows: “The wax figure was mounted on plywood and was wrapped in a soft, cushion-type paper. In the crate, which was also made of plywood, the figure was completely covered with little styrofoam balls that look like peanuts to protect it from breakage. The packing was the same as with all wax figures and was adequate for protection in shipping. On arrival at the museum, the defendant’s driver could not remove the crate from the defendant’s truck because it was wedged across the back of the truck with other freight. It was wedged in there just as tight as a drum. The driver got a five-foot piece of two by four and began to attempt to dislodge the crate. He finally got it up under the crate and started trying to pry it out. He was bending that crate and it was popping and he could not get the crate out. It was popping like everything. You could hear lumber and everything else popping. The way he was bending that crate he was about to bust the crate open. He could not get it out. He finally — well, as a matter of fact, I stopped him. He was going to tear it up because he could not get it out. I told him, ‘You’re going to break everything in there all to pieces.’ So, he had to go back to his warehouse to get it out. When he returned, it was loose and we were able to remove the crate. The figure is still in the crate it came in.”

In the typical action by a consignee for in transit damage to freight by a carrier, there is no direct evidence that the carrier caused the damage. Without such evidence the consignee can establish a pri-ma facie right of recovery circumstantially with proof and findings that the freight was delivered to the carrier in an undamaged condition and was then delivered by the carrier to the consignee in a damaged condition. See Missouri Pacific Railroad Co. v. Elmore & Stahl, (Tex.Sup., 1963) 368 S.W.2d 99, 101.

The testimony given by Mr. Clis-bee stands undisputed and unimpeached in the record. It supports the trial court’s finding that the damage to the wax figure was caused by the defendant’s driver when he attempted to pry the crate loose in the truck. A common carrier is responsible for damage to freight proximately resulting from its negligence in unloading a shipment. 11 Tex.Jur.2d 175, Carriers, § 407. With the direct proof of damage by the defendant’s agent, the plaintiff was not required to establish that the figure was undamaged when it was received by the defendant.

The plaintiff bases its claim for attorneys’ fees on the part of Article 2226, Vernon’s Tex.Civ.St., which permits such fees to any person who recovers a judgment on a claim for damaged freight. The plaintiff’s attorney testified that he devoted more than eight hours rendering necessary services in several particulars, which we need not detail, preparing for trial. He said that a reasonable fee for these services and the trial is $450. This proof is legally sufficient to support the $350 award for attorneys’ fees.

A carrier’s liability for freight damage in transit on an interstate shipment is set and controlled by the Interstate Commerce Act, 49 U.S.C.A. § 20(11). This Act does not allow an award of attorneys’ fees to a successful claimant. Southwestern Mot. Tr. Co. v. Valley Weathermakers, (Tex.Sup., 1968), 427 S.W.2d 597, 599. We agree with the defendant that the interstate shipment in question was “in transit” within the meaning of the Interstate Commerce Act until the wax figure was delivered to the plaintiff’s possession, which was after the damage was done. See, Article 886, Vernon’s Tex.Civ.St.; Ex parte Kimberlin, 126 Tex. 60, 86 S.W.2d 717, 720 (1935); Sheppard v. Musser, 127 Tex. 193, 92 S.W.2d 219, 222 (1936); Caddell v. J. R. Watkins Medical Co., (Tex.Civ.App., San Antonio, 1921, no writ) 227 S.W. 226, 229; 80 A.L.R.2d 452. Accordingly, the plaintiff is not entitled to attorneys’ fees.

The judgment is reformed by deleting therefrom the allowance for attorneys’ fees. As reformed the judgment is affirmed.


author: STEPHENSON, Justice.

text:
    James FOUNTAIN, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Court of Appeals of Kentucky.
    Sept. 5, 1975.
    As Modified Oct. 3, 1975.
    Jack Emory Farley, Public Defender, Paul F. Isaacs, Asst. Public Defender, Frankfort, for appellant.
    Ed W. Hancock, Atty. Gen., William W. Pollard, Asst. Atty. Gen., Frankfort, for appellee.
   STEPHENSON, Justice.

James Fountain was indicted on three counts of armed robbery and as an habitual criminal. A Daviess Circuit Court jury found Fountain guilty on each of the three counts of armed robbery and imposed a penalty of life imprisonment on each count. The jury did not mention the habitual criminal charge in its verdict.

The trial court granted Fountain a belated appeal. We dismiss the appeal sua sponte.

The only significance in this belated appeal is the display of energetic irresponsibility on the part of the public defender’s office. In the first attempt to appeal the case the office of public defender failed to file a timely record. In the motion to file a late record, they asserted they were not negligent but only just received the transcript of evidence. The record shows that the transcript was filed in the circuit clerk’s office some ten days before the filing deadline. The motion to file a late record was denied, and the appeal was dismissed. Next Fountain filed a motion for a belated appeal in the Daviess Circuit Court. His motion, in the form of an affidavit prepared by the public defender’s office, asserted that he was entitled to a belated appeal because of ineffective assistance of counsel in negligently failing to file a timely record on appeal.

On the one .hand, the public defender’s office tells us they were not negligent in failing to file a timely record on appeal; and on the other hand on the motion for a belated appeal, they assert their own negligence as ineffective assistance of counsel in failing to file a timely record on appeal. They cannot have it both ways. We are of the opinion that the conduct of the office of public defender is patently irresponsible.

Out of curiosity we have reviewed the record. Fountain received not only a fair trial, but a trial absolutely free of error. He does not assert any error in the trial. His only argument for reversal is that he was denied due process by being tried as an habitual criminal and not receiving a bifurcated trial. The argument for reversal is incomprehensible to us. The jury verdict afforded him more favorable treatment than that for which he contends on this appeal. Even Fountain’s brief recognizes that he presently stands acquitted on the habitual criminal charge.

The jury was instructed on the habitual criminal charge, but the form verdict given to the jury (apparently through oversight) did not contain a form of verdict for this charge, and the jury did not return a verdict thereon. Fountain should count himself fortunate that this oversight occurred although he apparently is determined to have a new trial, which in th.e light of the evidence would undoubtedly result in a conviction on the habitual criminal charge.

To sum it up, the irresponsible conduct of the public defender’s office in presenting us this belated appeal shows a waste of public funds in procuring a transcript of evidence which was not used, nor was it useful in any respect in that they argue a point of law which they had already won as a result of the jury’s verdict, an argument totally without merit in view of the many decisions of this court on the subject.

The appeal is dismissed sua sponte.


author: PALMORE, Justice.

text:
    David PHILLIPS, Appellant, v. COMMONWEALTH of Kentucky, Appellee.
    Court of Appeals of Kentucky.
    Dec. 13, 1974.

      Eulyn L. Dean, Tebbs S. Moore, Phillips & Moore, Harrodsburg, for appellant.
    Ed W. Hancock, Atty. Gen., Carl Miller, Asst. Atty. Gen., Frankfort, for appellee.
   PALMORE, Justice.

The appellant and his son, James Phillips, were jointly indicted on a charge of assault and battery. KRS 431.075. Finding both guilty, a jury fixed the punishment of James at 12 months in jail and that of the appellant at a $500 fine. James did not appeal.

Over objection, these questions and answers were admitted in evidence during cross-examination of James Phillips:

Q. Mr. Phillips, have you ever been convicted of a felony ?
MR. DEAN: Your Honor, I object.
(The Court and counsel confer at the bench, then in chambers.)
A. Yes.
MR. DEAN: Your Honor, I object to the question and would ask the Court to admonish the jury.
THE COURT: I think he is going to have to ask the next question as to what it was.
Q. One conviction or more than one conviction ?
A. Convicted of two at the same time, sir.
Q. What were they ?
A. One was detaining and the other was driving an automobile without the owner’s consent.
Q. Detaining what?
A. A woman.
Q. Against her will ?
A. Against her will.
Q. By force ?
A. No, sir.

Upon motion by defense counsel the trial court thereupon admonished the jurors to consider this evidence only insofar as they were of the opinion that it affected the truthfulness of the witness’s testimony.

The record does not disclose what took place at the conference outside the presence of the jury immediately prior to the reception of the testimony in question, but it seems probable that the purpose of the conference was to apprise the trial court of the nature of the previous felony convictions. In any event, the conviction for detaining a woman against her will (KRS 435.110) clearly had no bearing Qn the question of the witness’s veracity, nor did the conviction for driving a motor vehicle without the owner’s consent (KRS 433.220), since guilt of the latter offense does not necessarily depend upon an intent to steal or other dishonest purpose. Hence under the rationale of Cotton v. Commonwealth, Ky., 454 S.W.2d 698, 702 (1970), they were not admissible.

The Commonwealth’s argument to the effect that the evidence could have prejudiced only James Phillips, and not the appellant, misses the point. Though technically James was called as a witness in his own defense, there can be no doubt that his testimony was equally intended for the benefit of his father. They were represented by the same counsel, and their respective versions of the incident in question were consistent and mutually helpful. The testimony of each of them as a witness was important to the other. The impeachment therefore had a damaging effect on both. We are somewhat loath to reverse this conviction, but we intend to have Cotton followed, and if this is the way it has to be done, so must it be.

We find no error in the omission of an instruction on the right of appellant

(a police officer) to use force in effecting an arrest. Not only did he make no claim that he had to use force in making the arrest, but denied having used any at all. The other evidence likewise offered no basis for a theory that the assault (committed mainly, if not entirely, by James) may have been justified incident to an arrest.

The judgment is reversed for a new trial of the appellant, David Phillips.

All concur.


author: HOLMAN, Judge. MORGAN, Judge FINCH, Judge

text:
    FRONTIER AIRLINES, INC., et al., Appellants (Plaintiffs), v. The STATE TAX COMMISSION of Missouri et al., Respondents (Defendants).
    Nos. 58677—58682, 58719, 58720, 58723, 58736 and 58752.
    Supreme Court of Missouri, En Banc.
    Sept. 8, 1975.
    Rehearing Denied Oct. 13, 1975.
    See also, Mo.Sup., 528 S.W.2d 952.
    Stinson, Mag, Thomson, McEvers & Fizzed, by Dick H. Woods, George E. Gibson, George E. Feldmiller, Kansas City, for Trans World Airlines, Inc., Eastern Airlines, Inc., Frontier Airlines, Inc., Allegheny Airlines, Inc., Braniff Airways, Inc., American Airlines, Inc., Delta Air Lines, Inc. and Host International, Inc.

      Neale, Newman, Bradshaw & Freeman, by Paul L. Bradshaw, Thomas G. Field, Springfield, for Ozark Air Lines, Inc.
    Jack L. Koehr, City Counselor, by James J. Wilson, Associate City Counselor, St. Louis, for City of St. Louis.
    Thomas W. Wehrle, County Counselor, Clayton, for respondents, St. Louis County, Missouri, E. J. Pung, Director of Revenue, Frank J. Antonio, Assessor.
    John C. Danforth, Atty. Gen., Walter No-wotny, Jefferson City, for respondent, State Tax Commission of Missouri.
    Boyle, Priest, Elliott & Weakley, Howard Elliott, Edward D. Weakley, St. Louis, for respondent, Berkeley School District.
   HOLMAN, Judge.

This proceeding involves separate appeals by the eight airlines named in the caption, Host International, Inc., and the City of St. Louis. The appeals were ordered consolidated by this court. They were jointly briefed and argued and will all be disposed of in this opinion. The appellants seek a review of real estate assessments for the year 1968 by the St. Louis County Assessor as affirmed by the County Board of Equalization, the State Tax Commission and the St. Louis County Circuit Court. The controversy relates to the proper method of valuation and assessment in respect to “leasehold interests” or “possessory interests” of portions of Lambert-St. Louis Municipal Airport occupied by the airlines and Host. The airport is located in St. Louis County and owned and operated by the City of St. Louis. While no tax was assessed against St. Louis City it has opposed the assessments against its lessees apparently on the theory that the added expense to its tenants would adversely affect the amount of rental they would pay the City in the future. We have appellate jurisdiction because construction of the revenue laws of this state is involved. Art. V., Sec. 3, Mo. Const.

In connection with our statement of the evidence it should be mentioned that considerable evidence was offered before the Commission to which an objection was sustained but the evidence was nevertheless heard under the provisions of Section 536.-070(7) V.A.M.S. We have considered such of that evidence as we deemed to be admissible.

The airport property embraced an area of approximately 1,700 acres and was improved with runways, taxiways, aprons, instrument landing and communication facilities and a terminal building with concourses, parking lots, cargo hangar, and office buildings.

On January 1, 1968, each of the airlines, as well as Host, occupied and paid rent on certain space in the terminal building for which they had the right of exclusive use. In addition, each airline was allocated and charged rent upon space denominated “nonexclusive space” which it was deemed to use in common with other airlines and tenants in the terminal building. As of January 1, 1968, the airlines’ use of both exclusive and nonexclusive terminal and concourse space was not the subject of formal lease agreements between them and the city; those leases had expired in 1965. As a result of negotiations between the airlines and the city commencing in the spring of 1965, formal lease agreements had been executed and submitted to the city in December, 1967. Those leases, which were for a term of 10 years commencing August 1,1965, did not become finally binding until December, 1968, when they were approved by the St. Louis City Council. It had been agreed, however, at the time negotiations began that the lease provisions and rental rates finally agreed upon would be retroactive to August 1, 1965. The rental rates paid by the airlines on both exclusive and nonexclusive space in the main terminal were as follows: Upper level, $9.00 per square foot; middle level, $6.50 per square foot; lower level, $5.50 per square foot; operating area, $3.00 per square foot; concourses, $4.00 per square foot.

On January 1, 1968, Host was occupying almost 32,000 square feet of space in the terminal building. This was under a concession agreement, dated January 31, 1967, under which Host was obligated to pay as rental for such space a percentage of gross annual sales on food and alcoholic beverages.

Under a separate lease, Ozark occupied an office building and hangar complex on a 10 acre site situated in the airport area. In 1968, the lease on these buildings had a remaining period of 24 years together with options for 12 and 10 year extensions. This lease was subject to cancellation by the city upon 12 months notice when, in the city’s opinion, the facilities were needed for an airport use of higher priority.

On May 31,1968, the assessor advised the airlines and Host concerning the amount of their assessments. The amount of the assessments on the space leased totaled approximately $3,000,000. In addition to that the assessor attributed to each one of them a proportionate part of a 72 acre tract called the “campus area.” A value of $1,300,000 was placed upon this campus area which, as stated, was allocated proportionately to the airlines and Host.

The formula or method used by the assessor in arriving at the foregoing valuations was obtained by him from John L. Vaughn, Jr., of Los Angeles, California, an expert in the field of real estate appraisals. On the other hand, the appellants relied upon the testimony of Walter R. Kuehnle, of Chicago, Illinois, an expert with 47 years experience in appraising real estate and interests therein. These two experts used widely differing methods in arriving at their opinions concerning the valuation of the interests here involved.

Mr. Kuehnle stated that in appraising a leasehold interest of a tenant the proper method is to determine the value of the property, the economic or rental value thereof, and the contract rental of the property as well as the length of the term of the lease and other provisions thereof which are the obligation of the lessee. He stated that “It’s a method accepted by appraisers everywhere. I know of no other way you could do it.” He further stated that by the use of this method one could determine the present value of any bonus to the lessee by the terms of the lease; that if the contractual rental was less than the fair market rental the leasehold would have a value. This method was illustrated by a simple example, as follows: If a store building being rented for $250 a month is worth $500 a month the value of the interest would be the present worth of the bonus for the remaining term of the lease. On the other hand, if the lessee was paying $750 a month for a store worth $500 a month the lease would, of course, have a negative value.

Mr. Kuehnle and his staff made an investigation of the airport properties and concluded that each of the airlines and Host were paying more than the full rental value of the areas leased by them and hence there was no bonus and the leaseholds were of no value. In arriving at the fair rental value of the space occupied by appellants, this witness not only considered the depreciated replacement value of the buildings but compared the premises with a number of other comparable airports in this country.

He further stated that California was the only state in which “possessory interests” somewhat like that used by the assessor is recognized. He also stated that the method used by the assessor resulted in a valuation of the real estate interest leased and not the leasehold interest.

Frank J. Antonio testified that on the relevant dates he was the assessor of St. Louis County; that he and his staff collected the information necessary to make the valuations in question; that they relied on the advice of John L. Vaughn, Jr. in applying the “possessory interest” method of assessing these leaseholds. He defined pos-sessory interest as representing the beneficial use of real estate by a tenant where the real estate is exempt by law from taxation as against the owner. Mr. Antonio further stated that in applying the method used in making the assessments he ignored the amount of rental paid by the lessee and the term that the lease would run; that he “had to in order to establish a uniform method of assessment”; that this method is applied only to tax exempt property.

The method used by the assessor is apparently new and novel. It has been formulated in an endeavor to obtain tax revenue from tax exempt real estate which, of course, must be obtained, if at all, from the tenants. We will attempt to outline this method as we understand it from reading the testimony of Mr. Antonio and Mr. Vaughn, as follows: (1) As indicated, the terms of the leases are disregarded and the assessor assumed an occupancy of 15 years for each tenant, (2) In order to obtain the estimated depreciated value of the buildings as of 1-1-68 he figured the trended replacement cost of the buildings as of 1-1-68 and depreciated it at a rate of 4% per year, (3) Using the assumed 15 year occupancy he estimated the depreciated value of the buildings on 1-1-83. The result is said to be the value of the city’s “right of reversion” on that date, (4) He next calculated the present worth of the 1-1-83 depreciated value of the buildings using a 6½% compound interest factor, (5) The present worth of the reversion (as obtained in the preceding step) is subtracted from the estimated 1-1-68 depreciated value of the buildings and the result is said to be the value of the tenant’s possessory interest in the building, (6) In regard to the 72 acre “campus area,” which was valued at $1,300,000, he calculated the present worth of the city’s reversion-ary right to the land in 15 years using a &⅛% compound discount factor of .3888. The product thus obtained was subtracted from $1,300,000, the present value, and the result was the value of the tenant’s “posses-sory interest” in the campus area, (7) The total of the value of the possessory interest in the buildings (step 5) and of the campus area (step 6) is then taken as the true value for assessment purposes and allocated to the airlines and Host in proportion to the percentage of total space occupied by each tenant on 1-1-68.

It should perhaps be mentioned at this point that complaint is made by respondents that the assessor requested copies of the leases and other information which was not furnished by some of the appellants and hence the assessor was forced to adopt a method such as outlined above in order to assess the interests. There is no merit in that suggestion. We have concluded from the record that the tenants reasonably complied with the assessor’s request. That, however, is irrelevant because it is clear from the assessor’s testimony that he would not have used the amount of rental, and length of term of the leases in any event.

The Commission made findings of fact and conclusions of law, ten pages in length. We deem it unnecessary to recite these in detail. Generally, it may be said that they were in accord with the contentions of respondents and contrary to those of the airlines and Host. It was specifically found that the method of assessment suggested by Mr. Vaughn was a “fair, reasonable, orderly, and appropriate plan of valuation”; that the opinion and testimony of Mr. Kuehnle was “not credible and without probative force.”

“In our review of the orders of the State Tax Commission we have in mind that we are not permitted to substitute our discretion for discretion legally vested in the Commission and should not set aside its findings unless such are ‘unsupported by competent and substantial evidence upon the whole record’; or are ‘for any other reason, unauthorized by law’; or are ‘arbitrary, capricious or unreasonable’; or that they involve ‘an abuse of discretion.’ ” Stein v. State Tax Commission, 379 S.W.2d 495 (Mo.1964).

We state at the outset of our consideration of this appeal that there is no controversy about the fact that this real estate, owned by the City of St. Louis, is exempt from taxation. Art. X, Sec. 6, Mo.Const. and Section 137.100(2), V.A.M.S. There also seems to be no question but that leaseholds in city owned real estate are taxable if they have any value. Iron County v. State Tax Commission, 437 S.W.2d 665[3] (Mo.1968).

We agree with the contention of appellants that the assessor’s valuations of their leasehold interests were arrived at by an erroneous method which directly conflicted with a method approved by decisions of this court. In Land Clearance for Redevelop. Corp. v. Doernhoefer, 389 S.W.2d 780, 784 (Mo.1965) this court stated that: “. the value of the leasehold should be determined from the testimony of qualified expert witnesses as that value which a buyer under no compulsion to purchase the tenancy would pay to a seller under no compulsion to sell, taking into consideration the period of the lease yet to run, including the unexercised right of renewal, the favorable and unfavorable factors of the leasehold estate, the location, type and construction of the building, the business of the tenant, comparable properties in similar neighborhoods, present market conditions and future market trends, and all other material factors that would enter into the determination of the reasonable market value of the property. The bonus value, sometimes referred to as the leasehold savings or profit, is the difference between the economic rental and the contract rental. The economic rental is the actual market value of the use and occupancy.” In United States v. Petty Motor Co., 327 U.S. 372, 381, 66 S.Ct. 596, 90 L.Ed. 729 (1945) the court stated: “The measure of damages is the difference between the value of the use and occupancy of the leasehold for the remainder of the tenant’s term, plus the value of the right to renew in the lease of Petty, less the agreed rent which the tenant would pay for such use and occupancy.” See also, Stephen & Stephen Properties, Inc. v. State Tax Commission, 499 S.W.2d 798 (Mo.1973).

In St. Louis County v. State Tax Commission, 406 S.W.2d 644 (Mo.1966), (a case involving substantially the same parties and issues as the one before us) we approved the Doernhoefer decision and held that the formula testified to by Witness Randall was in accord with the approved method. The Randall formula is very similar to that testified to by appellants’ expert in the case at bar. Moreover, in this prior case we expressly disapproved of a method of valuation which assumed a longer term of tenancy than the remaining life of the leases. In the case under review the Commission approved a method of valuation that assumed a 15 year tenancy which assumption squarely conflicts with our prior holding.

It is our view that there is no valid basis in law or fact for support of the method used by the assessor. As heretofore stated it disregards elements which this court has held essential in the valuation of a leasehold. Moreover, we think the practical result of the use of that method is to value a substantial portion of the real estate rather than the leasehold, which, of course, is improper and unlawful. We think one illustration of that result is shown by an old building which the assessor concluded did not have a remaining economic life of 15 years on which he assessed the entire depreciated value on 1-1-68 against the lessee. It is also interesting to note that no case has been cited in which this method has been used or approved. There is some suggestion that a similar method was approved in De Luz Homes, Inc. v. County of San Diego, 45 Cal.2d 546, 290 P.2d 544 (1955) but that case approved a different method and the factual situation is so entirely different that the case has no application to the issue before us.

The respondents seek to justify the method used by the assessor by saying that this is special use property to which the usual rules do not apply. They say there is no market for the transfer of these leases and that it is proper to assume a period of occupancy beyond the lease term because these lessees will remain in the premises for an indefinite period regardless of the lease provisions. This contention would clearly not apply to Host. While it may be likely that most of the airlines will continue to remain tenants in this airport we cannot approve such a speculative assumption for assessing tax valuations. We judicially know that the municipal airport in Kansas City was abandoned for major airline use a few years ago and a new airport constructed. It is also well known that there has been serious consideration for years to the establishment of another airport for the St. Louis area. Moreover, any one of the airlines might decide at any time to discontinue service to the St. Louis area. As indicated, this contention is disallowed.

In summary, we hold that the method or formula used by the assessor is an improper method of valuation unauthorized by law and that its approval by the State Tax Commission was arbitrary and unreasonable. We approve of the method of valuation outlined in our prior cases and testified to by Mr. Kuehnle.

Since there will be further consideration of these cases by the Commission there are two other contentions which should be briefly considered. Appellants complain that the Commission erred in excluding their evidence regarding rents paid at other comparable airports for space similar to that occupied by them. It is our view that such evidence was admissible. Complaint is also made that it was arbitrary and unlawful for the assessor to allocate to the appellants the value of the “campus area” which included land adjacent to the buildings in question. Respondents have not cited any authority to support that action. We are unable to see any valid basis for charging appellants with the value of land they did not lease or pay rent on and which is used by the air travel public generally.

The judgments in these cases are reversed and the causes are remanded to the trial court with directions that it reverse its judgments of affirmance and remand the cases to the State Tax Commission for further proceedings not inconsistent with this opinion.

BARDGETT, HENLEY and DONNELLY, JJ., concur.

MORGAN, J., dissents in separate dissenting opinion filed.

FINCH, J., dissents in separate dissenting opinion filed.

SEILER, C. J., dissents and concurs in separate dissenting opinion of FINCH, J.

MORGAN, Judge

(dissenting).

I respectfully dissent.

The property sought to be taxed in this instance is owned by the City of St. Louis. Section 6 of Article 10 of the 1945 Constitution of Missouri provides, in part: “All property, real and personal, of the state, counties and other political subdivisions shall be exempt from taxation . ” No exceptions are provided therein. Such exemption applies to the same in its entirety; and, any effort to tax some portion thereof carved from the fee is, in my opinion, violative of the constitutional exemption established by the citizens of this state. Cases wherein this court has found otherwise should no longer be followed.

The tax exemption is that of the City of St. Louis in the public use of the property for a municipal airport. The right to rentals for the use of a portion thereof belongs to the municipality; and common sense dictates that the City of St. Louis, in fact, is paying any tax levied by St. Louis County because the tax on a tenant necessarily must be accounted for in setting the amount of rental. For instance, if the reasonable rental is $100. per month and the county tax amounts to $10. a month, the rental available will be $90. and for all practical purposes the city pays the county tax.

The suggestion is not novel. As said in 71 Am.Jur.2d § 200, State and Local Taxation, at p. 519:

“With respect to the taxation by a municipal corporation of the property of another municipal corporation of the same state located within the boundaries of the former, it is the majority rule that such property is exempt from such taxation, if it would be exempt if located within its own territorial boundaries, in the absence of any provision to the contrary. In many instances, the exemption from taxation is expressed by constitutional provision or by statute. The rule is sometimes stated with the qualification that property taken or held for a public use by one municipality within the territorial limits of another, or within its own boundaries, is not subject to taxation so long as it is actually devoted to a public use. The reason is that property held and used for the benefit of the public ought not to be made to share the burden of paying the public expenses. That exemption does not rest on any provision of statute, but is founded on general principles of expediency and justice. Correspondingly, it has been held on the other hand, that exemption from taxation, in view of the principle on which it rests, cannot justly be extended to property owned by one municipality within the bounds of another, not actually devoted to a public use or held with the design within a reasonable time to devote it to such use.”

In an annotation entitled “Property of one municipality within territorial limits of another as subject to taxation by latter” in 81 A.L.R. at p. 1520, it is said:

“And it may be stated as a general rule, deduced from the holdings and inferences of the courts in the decisions herein cited, that the property of one municipality located in another in the same state is exempt from taxation, if it would be exempt if located within its own territorial boundaries, unless express legislation has changed the rule.”

Consistent therewith is the supplemental annotation in 99 A.L.R. at p. 1144.

How are such taxes to be collected if not paid? Section 140.640 prohibits a personal money judgment against a tenant for unpaid taxes. The property taxed is charged with any delinquency to be followed by foreclosure. Would be purchasers, if any, would thus be forced on the city as tenants in its property whether desirable or not. It would logically follow that the city, contrary to its constitutional exemption, would have to discharge the lien of such taxes to maintain proper control over its facility.

An airport is a unique property, with a singular reason for its existence. If prior decisions, contrary to the suggestion here made, and applicable to industrial development situations are to remain as the law of this state, it should be declared that they do not apply to a city airport.

FINCH, Judge

(dissenting).

I respectfully dissent.

As the principal opinion notes, there is no question but that property owned by a city is exempt from taxation. Art. X, § 6, Mo. Const. However, leaseholds or possessory interests therein owned by tenants not possessing a tax exempt status are taxable. Iron County v. State Tax Commission, 437 S.W.2d 665 (Mo.1968). In this case appellants are tenants (of the City of St. Louis) which do not have a tax exempt status. Hence, the issue presented is not whether their possessory interests in the airport property are subject to assessment and taxation but rather whether the assessments as made by the assessor and approved by the State Tax Commission are to be sustained as representing the “true value in money” of the interest of appellants as required by § 137.115.

Relying principally on Land Clearance for Redevelopment Corp. v. Doernhoefer, 389 S.W.2d 780 (Mo.1965) and St. Louis County v. State Tax Commission, 406 S.W.2d 644 (Mo.1966), the principal opinion reverses the judgments of the circuit court which in turn had affirmed the action of the State Tax Commission in upholding the assessments by the assessor. In so holding the principal opinion concludes that the assessor’s valuations of appellants’ interests were arrived at by a method which conflicted with that approved previously in Doernhoefer and in St. Louis County and that the Commission’s action in approving such appraisals was arbitrary and unreasonable. The opinion specifically ratifies the method of evaluation previously approved by this court in the Doernhoefer and St. Louis County cases and remands the case for proceedings by the Tax Commission consistent therein.

Doernhoefer was a case involving the allocation of a condemnation award between the fee owners of the property and their tenant. The property involved was a three-story building located at Sixth and Pine streets in St. Louis with the tenant occupying the lower portion thereof as a pawn shop. The lower court made an award to the tenant from the condemnation judgment on the basis of what was referred to as the bonus value of its lease. This particular lease had 7½ years to run with an option to renew for ten years and the court, based on testimony, determined the difference between the contract rental on the property and the economic rental thereon and granted the difference between the two for the remainder of the lease and option periods. In approving that formula, this court said, 389 S.W.2d at 784:

“ * * * [T]he value of the leasehold should be determined from the testimony of qualified expert witnesses as that value which a buyer under no compulsion to purchase the tenancy would pay to a seller under no compulsion to sell, taking into consideration the period of the lease yet to run, including the unexercised right of renewal, the favorable and unfavorable factors of the leasehold estate, the location, type and construction of the building, the business of the tenant, comparable properties in similar neighborhoods, present market conditions and future market trends, and all other material factors that would enter into the determination of the reasonable market value of the property.”

I am of the opinion that Doernhoefer does not govern the instant case. In the first place, it dealt with apportionment of a condemnation award between the landlord and tenant, not with administrative review of the method and amount of an assessment of property for tax purposes made by a county assessor. Secondly, and even more importantly, it involved a commercial building located in the City of St. Louis in which space would have been suitable for numerous uses and purposes. It was possible, by means of testimony as to rentals of similar property, to determine the actual market value of use and occupancy in the property in question compared with the contract rental which the tenant paid, thereby arriving at a valuation of the leasehold interest based on the so-called bonus value formula. The instant case does not involve that kind of generally useable property. Rather, we deal with leasehold or possessory interests in a special or limited purpose property. The airport terminal and associated properties are designed and built for the purpose of handling aircraft passengers and cargo. Only certificated air carriers are interested in or could utilize such space. Carriers certificated to serve Lambert-St. Louis Municipal Airport already occupied quarters in the airport building. Absent certification of additional carriers, there are no other companies which would be prospective purchasers of these leasehold or possessory interests. These leases are not ones bought and sold on an open market and hence do not have a market value readily ascertained on the basis of such a market. Consequently, the bonus method of determining value on the basis of what a willing but unobligated seller and a willing but unobligated buyer would agree upon for leasing such airport space is not a very realistic method for determining the value of appellant’s leasehold or possessory interests. Most certainly, it does not represent the only method which could be utilized to determine the “true value in money” of these leasehold or possessory interests in Lambert-St. Louis airport property.

This court, in several condemnation cases, has recognized that it is not always possible to determine the fair market value of property on the usual willing but unobligated buyer and willing but unobligated seller formula, and that other methods to determine value must be utilized in such situations. One such instance was in City of St. Louis v. Union Quarry & Construction Co., 394 S.W.2d 300 (Mo.1965), wherein the court recognized that an abandoned rock quarry used as a dump was a unique property in which a different method of determination of value which included capitalization of income was proper.

Another such case was State ex rel. State Highway Commission v. Mount Moriah Cemetery Association, 434 S.W.2d 470 (Mo.1968), wherein the State Highway Commission was condemning part of a cemetery tract. This court recognized that cemeteries were special purpose properties which are not usually bought and sold on the market. As a consequence, the court held that an instruction which told the jury to base its award upon fair market value arrived at by the usual willing but unobligat-ed seller and willing but unobligated buyer test should not have been given and that a new trial was required. In so holding this court quoted with approval from Graceland Park Cemetery Co. v. City of Omaha, 173 Neb. 608, 114 N.W.2d 29, 31, as follows:

“There are types of property that are not bought and sold on an open market and consequently do not have a reasonable market value within the rule that the fair market value is the price which property will bring when offered by a willing seller to a willing buyer, neither being obligated to buy or sell. The fair market value of property implies proof of sales of similar property in the community as a means of fixing the value of the property taken. When the property is such that evidence of fair market value is not obtainable, necessarily some other formula for fixing the fair value of the property must be devised. This is true, as we view it, of such properties as school yards, church yards, college campuses, buildings under construction, and cemeteries. [Citation] We hold, therefore, that in the taking of land used for cemetery purposes the measure of damages is not the fair market value of the land for the simple reason that such property has no fair market value.”

The court in Mount Moriah approved utilization of evidence of capitalization of income in the determination of value of the property being taken. See also Reorganized School District No. 2 v. Missouri Pacific Railroad Co., 503 S.W.2d 153 (Mo.App.1973).

Neither is St. Louis County dispositive of this appeal. In that case the county assessor made assessments for 1963 covering the leasehold interests of seven airlines in parts of Lambert-St. Louis Municipal Airport. On appeal, the State Tax Commission, after hearing evidence, found that the assessor had used an incorrect formula in making his assessment and that under the evidence which it heard, the contractual rent was greater than the fair market value resulting in the assessment being “zero or no value.” The circuit court on petition for review reversed the decision of the Tax Commission and reinstated the evaluation and assessment made by the county assessor. However, on appeal to this court, we held that the decision by the Commission as to values of the leasehold interests of the airlines was supported by competent and substantial evidence upon the whole record and should be sustained. Accordingly, pursuant to the type of judicial review called for by § 536.140(2), the judgment of the circuit court was reversed and remanded with directions to enter a judgment affirming the decision of the Tax Commission.

In contrast, the Tax Commission in this case affirmed the assessment made by the county assessor. The Commission made extensive findings of fact and conclusions of law in reaching that conclusion. Included therein were findings that the testimony of witnesses offered in support of the assessment by the assessor were fair, reasonable and accurate and that the testimony of the witness who testified for the airlines as to value of their leasehold interests was not credible.

The principal opinion reverses on the basis that the action of the Tax Commission in approving the assessment made by the assessor utilized an unapproved and impermissible formula and that in so doing its action was arbitrary and unreasonable. I cannot concur in that conclusion. St. Louis County did not hold that the bonus method of valuation is the only method useable in appraising possessory interests in tax exempt real estate. Missouri cases, as previously indicated, do not limit determination of market or true value to utilization of what a willing but unobligated buyer and a willing but unobligated seller would agree upon when special purpose property or property as to which there is no market is involved. In such instances some other method of determining value can and will be approved. In Union Quarry and in Mount Moriah, a formula which included capitalization of income was approved. In Reorganized School District No. 2, the court approved utilization of cost of replacement less depreciation. In this case the Tax Commission found that while at the date of assessment some of the tenants had no leases and were in the process of renegotiating leases, history disclosed that the airline tenants enjoyed continuous and continuing possession in the specially designed and dedicated premises and that they would continue to occupy the premises on a quasi-permanent basis, subject to adjustment at intervals which would not materially affect the beneficial use and enjoyment of the interests possessed. That was a reasonable conclusion, given the fact that they have occupied the terminal over the years and, unless and until changes in carriers certificated are made, are the only prospects for use of these airport facilities.

The principal opinion specifically approves the bonus formula as the required method for valuing these airport leasehold or possessory interests and in effect directs that on remand the assessments be determined on that basis. Necessarily, such a conclusion must be premised on the assumption that such a formula will accurately portray the “true value in money” of these interests and is, in fact, the only method which will accomplish that purpose. I cannot agree that such a conclusion is correct. In my judgment it is not realistic to say that the possessory interests in Lambert-St. Louis Municipal Airport have no “true value in money.” They do have. They are of substantial value to these appellants. Without them, appellants could not serve the air traveling public in St. Louis because there is no other property which they could lease and utilize for this unique purpose. The unique character of the property involved requires, for the reasons herein enumerated, the recognition, as in Union Quarry, Mount Moriah and Reorganized School District No. 2, that another method of determining value must be utilized. Accordingly, I dissent.

      . All statutory references are to RSMo 1969 unless otherwise indicated.


author: HOLMAN, Judge. FINCH, Judge MORGAN, Judge

text:
    The HERTZ CORPORATION et al., Appellants (Plaintiffs), v. The STATE TAX COMMISSION of Missouri, ST. LOUIS COUNTY, Missouri, et al., Respondents (Defendants).
    Nos. 58694, 58695, 58696, 58714, 58733, 58734, 58735, 58740, 58742, 58743, 58795, 58813 and 58730.
    Supreme Court of Missouri, En Banc.
    Sept. 8, 1975.
    Rehearing Denied Oct. 13, 1975.

      James Crowe, St. Louis, for appellant, The Hertz Corp.
    Harold E. Goldberg, St. Louis, for appellants, Henry Binsbacher and Handley Products Co.
    John T. Murphy, Murphy & Schlaprizzi, St. Louis, for appellants, Premier Service Corp. and Auto Rental Inc.
    Jack L. Koehr, City Counselor, James J. Wilson, Associate City Counselor, St. Louis, for appellant, City of St. Louis.
    Thomas C. Walsh, Franklin F. Wallis, Michael B. McKinnis, St. Louis, for appellant, Avis Rent-A-Car System, Inc.; Bryan, Cave, McPheeters & McRoberts, St. Louis, of counsel.
    John C. Danforth, Atty. Gen., Walter No-wotny, Asst. Atty. Gen., Jefferson City, Thomas W. Wehrle, St. Louis County Counselor, Clayton, Boyle, Priest, Elliott & Weakley, Howard Elliott, Edward D. Weak-ley, St. Louis, for respondent, Berkeley School District.
   HOLMAN, Judge.

This proceeding involves thirteen appeals by or on behalf of nine concessionaires who are tenants occupying space at Lambert-St. Louis Municipal Airport. The six tenants named as appellants in the caption filed separate appeals. The City of St. Louis filed separate notices of appeal in its own name in behalf of four of those tenants and three others, i. e., Red Arrow Corporation, Airborne Freight Corporation and Air Cargo Terminals, Inc. The appeals were ordered consolidated by this court. The appellants seek a review of real estate assessments for the year 1968 by the St. Louis County Assessor as affirmed by the County Board of Equalization, the State Tax Commission and the St. Louis County Circuit Court. The controversy in these cases relates to the method of valuation and assessment in regard to “leasehold interests” or “possessory interests” of portions of the airport occupied by the concessionaires here involved. The airport is located in St. Louis County and owned and operated by the City of St. Louis. For reasons hereinafter appearing the City has opposed these assessments against its lessees. We have appellate jurisdiction because construction of the revenue laws of this state is involved. Art. V, Section 3, Mo.Const.

This is a companion case to Frontier Airlines, Inc. et al. v. State Tax Commission of Missouri et al., Mo., 528 S.W.2d 943, decided concurrently herewith. The evidence in each case was substantially the same and the basic issue is identical. Therefore, for reasons stated in Frontier we hold that the method or formula used by the Assessor in these cases is an improper method of valuation unauthorized by law and that its approval by the State Tax Commission was arbitrary and unreasonable.

There is, however, an additional point raised in these cases not raised in Frontier which we have concluded must be decided. This involves the question as to whether the City of St. Louis is a proper party in these proceedings and an “aggrieved party” within the meaning of Section 536.100 V.A.M.S.

At the beginning of the hearing before the Commission the respondents moved to strike the City as a party because no assessment had been levied against it and it was therefore not a proper party or aggrieved party. The motion was taken with the case and sustained at the conclusion of the proceedings. The circuit court held that there was no statutory authority for the City’s petition for review on behalf of certain of its tenants (which amounted to a vicarious appeal) and denied relief.

The City says it had a right to appeal from the board of equalization to the Commission because Section 138.430(2) V.A. M.S. gives that right to “Every owner of real property.” We do not agree. We think it must be implicit in that section that the property owner' must have been aggrieved by the valuation fixed by the board of equalization. Here, no tax was assessed against the City and we must therefore decide whether there was any other basis for concluding that it was aggrieved.

A rather convincing argument is made by the City to the effect that it has an interest in this controversy. It points out that the assessments will create a lien on the leaseholds; that there is no personal liability for payment of real estate taxes; that if the taxes are not paid the county will likely try to sell the leaseholds; that such would create many legal problems and might result in it having some undesirable tenants. The City also suggests that if the assessments are upheld and the taxes are paid by the tenants that such will increase the tenants’ cost of doing business and decrease the amount of rent the City would be able to obtain in future lease agreements.

The general rule is that a party is aggrieved when the judgment operates prejudicially and directly upon his personal or property rights or interests and that such must be immediate and not merely a possible remote consequence. See 4 C.J.S. Appeal & Error § 183, p. 559, et seq. The Missouri cases are in accord with that rule. See, Schumacher v. Schumacher, 223 S.W.2d 841[12] (Mo.App.1949), Feeler v. Reorganized School District No. 4, 290 S.W.2d 102 (Mo.1956) and In Re Estate of Soengen, 412 S.W.2d 533 (Mo.App.1967).

We have concluded that although the City has an interest in this controversy that the judgments do not directly and immediately affect its property interests, no taxes having been assessed against same, and hence it is not an aggrieved party within the meaning of Section 536.100 V.A.M.S. We have found no cases directly in point. Our view is supported, however, by the case of American Petroleum Exchange v. Public Service Commission, 238 Mo.App. 92, 176 S.W.2d 533 (1943) although we recognize that that decision was somewhat restricted in the later case of Dubinsky Brothers, Inc. v. Industrial Comm’n of Mo., 373 S.W.2d 9 (Mo.1963). By analogy, the case of State ex rel. St. Francois C.S.D.R.-III v. Lalumondier, 518 S.W.2d 638 (Mo.1975) would appear applicable. Therein, we held that a school district (which undoubtedly had a financial interest) could not obtain a review of an alleged underassessment of the property of an extensive landowner by the assessor and county board of equalization.

As indicated by the foregoing, in the cases in which the City of St. Louis appealed the appeals are dismissed. In the cases in which the tenants appealed the judgments are reversed and the causes are remanded to the trial court with directions that it reverse its judgments of affirmance and remand the cases to the State Tax Commission for further proceedings not inconsistent with this opinion and the opinion in Frontier, supra.

BARDGETT, HENLEY and DONNELLY, JJ., concur.

FINCH, J., concurs in part and dissents in part in separate concurring and dissenting opinion filed.

SEILER, C. J., concurs in separate concurring and dissenting opinion of FINCH, . J.

MORGAN, J., dissents in separate dissenting opinion filed.

FINCH, Judge

(concurring in part and dissenting in part).

I concur in that portion of the principal opinion which dismisses the appeals taken by the City of St. Louis. However, I dissent from the remainder of the opinion for the reasons expressed in the case of Frontier Airlines, Inc. et al. v. State Tax Commission of Missouri et al., 528 S.W.2d 943 (Mo. banc 1975), decided concurrently with this case. I recognize that the character of the appellants and the premises they occupy differ somewhat from that of the airline companies in Frontier Airlines, but we still deal with a unique or special purpose facility and I do not believe that we should hold that the bonus method, based on a willing but unobligated seller and a willing but unobligated buyer, is the only permissible method of valuing possessory interests in such property.

MORGAN, Judge

(dissenting).

I dissent for the reasons expressed in Frontier Airlines, Inc. et al. v. State Tax Commission of Missouri et al., 528 S.W.2d 943 (Mo. banc 1975), decided concurrently with this case.


author: WEIER, Presiding Judge.

text:
    George S. FOWLER, Jr., et ux., Plaintiffs-Respondents, v. CLAYTON SCHOOL DISTRICT et al., Defendants-Appellants.
    No. 36529.
    Missouri Court of Appeals, St. Louis District, Division One.
    Aug. 19, 1975.
    Motion for Rehearing or Transfer Denied Oct. 22, 1975.

      Ziercher, Hocker, Tzinberg, Human & Mi-chenfelder, Gerald R. Ortbals, Clayton, for defendants-appellants.
    Mark M. Wenner, St. Louis, for plaintiffs-respondents.
   WEIER, Presiding Judge.

Plaintiffs, who are the parents of two small children of school age, filed suit against the Clayton School District and its superintendent seeking an order of court to establish that plaintiffs and their children are residents of the school district and are entitled to attend the district’s schools without payment of tuition. Plaintiffs sought a judgment reimbursing them for prior tuition paid and enjoining the defendants from imposing any tuition charge or other enrollment fee upon the plaintiffs or their children so long as they continue to reside at their described premises. Judgment was rendered in favor of plaintiffs on all issues and the defendants were ordered to refund to plaintiffs without interest the sum of $1,685.39 paid for tuition for the 1973-74 school year.

Defendants have appealed, contending that the court disregarded plaintiffs’ burden of proof to establish a change of domicile; that the court erred in subordinating all objective evidence to a single subjective factor, that is, the intention of the parties seeking to establish domicile; and that the trial court’s judgment was erroneous in that it was predicated on invalid public policy considerations. Plaintiffs’ case succeeds or fails upon the evidence which establishes their place of domicile, either in the City of Clayton, which is in St. Louis County, or in the City of St. Louis, a separate political entity from the County. Plaintiffs’ residence, located at 6255 Wy-down Boulevard, was constructed upon a lot which lies partially within the City of St. Louis and partially within the City of Clayton. Each municipality is organized into a separate school district which maintains separate school facilities. Clayton contends that only a small portion of the lot and residence is within its eastern limits and that by far the larger portion of the residence and other improvements upon the property lie within the City of St. Louis. Plaintiffs, however, contend that the center of their activities is not in the City of St. Louis, but is rather in St. Louis County, which is a separate political subdivision, in that when they moved into the residence they actually intended to move into Clayton. The importance of a determination of the residence of the plaintiffs lies not in whether the children may attend school in the Clayton district, but rather whether plaintiffs must pay tuition charges to that district if the children attend the Clayton schools. The Missouri statute, § 167.151, RSMo 1969, provides in subsection 3: “Any person who pays a school tax in any other district than that in which he resides may send his children to any public school in the district in which the tax is paid and receive as a credit on the amount charged for tuition the amount of the school tax paid to the district.” Under this section plaintiffs have the option to send their children to the Clayton schools even if they are domiciled in St. Louis.

1973 taxes for the residence of plaintiffs were based on an assessment as to that portion of the lot lying within the City of St. Louis at $4,900.00 for the land and $20,-000.00 for improvements. For the same year, the assessment for City of Clayton-St. Louis County was $950.00 for land only. Taxes paid to the City of St. Louis were $1,399.38 and City of Clayton-St. Louis County $66.89. For the first semester of the 1973-74 school year, plaintiffs paid the Clayton School District $850.00 and for the second semester of the same school year, after credit for payment of 1973 real estate taxes to the Clayton district, the sum of $835.39, for a total of $1,685.39 in tuition.

At common law, the words “domicile” and “residence” are almost invariably employed as synonymous and interchangeable. State ex rel. Stoffey v. La Driere, 273 S.W.2d 776, 781[13] (Mo.App.1954). § 1.020(9), RSMo 1969, defines the phrase “place of residence” as “the place where the family of any person permanently resides in this state, * * *.” It is obvious that the sense in which the word “resides”, as used in § 167.151, supra, is that of “domicile”. “Residence” or “domicile” are further defined as that place where a person has his true, fixed and permanent home and principal establishment to which, whenever he is absent, he has the intention of returning. State ex rel. King v. Walsh, 484 S.W.2d 641, 644[2] (Mo. banc 1972). The establishment of one’s residence or domicile is largely a matter of intention, but it is not entirely subjective intention. Intention must be considered in the light of physical acts performed in conformity with this intent to establish the fact of residence. State ex inf. Reardon v. Mueller, 388 S.W.2d 53, 59[10] (Mo.App.1965).

We consider the facts as they were given in the agreed statement submitted to the trial court. The facts themselves are not in dispute. Rather it is the application of the law to the facts that causes a divergence of opinion. We look first to the physical characteristics of the house and the location of the boundary lines as they cross the lot at 6255 Wydown Boulevard. The lot fronts on the north side of Wydown a distance of 100 feet and runs northwardly slightly more than 200 feet. It is rectangular in shape with opposite lot lines having the same distance. Except for a slight variation south of the 40 foot building line, the boundary line establishing the western city limits of the City of St. Louis and the eastern city limits of the City of Clayton passes through the lot from north to south so that the east 70 feet of the lot are in the City of St. Louis and the west 30 feet are in the City of Clayton. Most of the three story brick residence which occupies this lot and in which the Fowlers live, including their bedroom, the dining room, living room and kitchen, lie wholly within the City of St. Louis. A family room, 12.35 feet by 27.75 feet, the western 5 feet of the living room, the western 5 feet of the children’s two bedrooms, and an adjoining bath, and in the basement the western 5 feet of a playroom lie wholly within the Clayton School District.

We next turn our attention to prior location. Plaintiffs moved to the 6255 Wydown address from 32 Kingsbury Place in the City of St. Louis in August of 1973. Plaintiff George Fowler has his place of business and conducts his employment wholly within the City of St. Louis. Both plaintiffs have attempted to register to vote as residents of Clayton, but the St. Louis County Board of Election Commissioners have refused to register plaintiffs, contending they reside in the City of St. Louis.

As to activity factors, most of the family activities of the Fowlers are centered in the St. Louis County area rather than in the City of St. Louis. Although some of these activities are in Clayton, many of them are in communities near Clayton but not in that city. They attend church in the County. They do their personal banking there. They do most of their buying at businesses located in St. Louis County. Likewise, their social and recreational activities are largely in that area.

Counsel for both parties have failed to call our attention in their briefs to any Missouri opinion which exactly resolves the question here presented. We in our own research have failed to find any. Although the problem rarely presents itself in a justi-ciable controversy, it would appear that various tests, more or less arbitrary, have been applied in other jurisdictions. For instance, if a line divides a house so that the part in one jurisdiction is sufficient in itself to constitute a habitation, whereas the other is not, then the domicile is in the former jurisdiction. Some make a determination based upon where the bedroom of the householder is located. Others may place greater emphasis upon the person’s activities and intentions rather than the location of the bedroom or the major part of the house. 25 Am.Jur.2d Domicil § 38, p. 28; Restatement 2d, Conflict of Laws, § 18, Reporter’s Note, Comment h, p. 77. In Restatement 2d, Conflict of Laws, § 18(h), p. 75, it is said: “When the dwelling place is situated upon a dividing line between political divisions, it may be difficult to determine in which of these divisions the domicil is. Usually, the domicil will be in that political division where the major portion of the dwelling place is located, particularly if only an uninhabitable part lies in the other. On rare occasions, however, the preponderant portion of the person’s dwelling place may be in one political division, while the bulk of his interests and activities, and also those of his family, are in the other.”

It is evident from the facts that the major portion of the dwelling place of the Fowlers is located in the City of St. Louis. It is also evident that the part that lies in the City of Clayton would not be a habitable unit in itself. If we would consider this to be the test, then we must say that under the facts the Fowlers reside in the City of St. Louis. If we apply the test as to where the Fowlers’ bedroom is located, it would seem that the plaintiffs sleep in the City of St. Louis and there they reside. In considering the third test as to the location of the center of plaintiffs’ interests and activities, we would again have to arrive at the conclusion that this would be in the City of St. Louis. Mr. Fowler has his place of business and employment in the City of St. Louis. If plaintiffs vote, they must vote in the City of St. Louis. If they receive mail, it would be sent to that part of the house that is located in the City of St. Louis. By far the major part of the taxes on the property where they live goes to the City of St. Louis. There is such a small portion of the structure located in Clayton that no part of the building in this political subdivision is assessed for tax purposes. Although not conclusive, engaging in business and voting at a particular place are evidence of residence. In re Ozias’ Estate, 29 S.W.2d 240, 243[8] (Mo.App.1930).

It is true that the social and commercial activities of plaintiffs, as well as church attendance, are not centered in the City of St. Louis. It is interesting to note, however, that not all of these activities are centered in Clayton. It is admitted that some of the shopping which they do is conducted in Richmond Heights; their personal banking in Brentwood. Activities carried on by the plaintiffs in Clayton may be centered there by reason of convenience but do not in and of themselves outweigh the factors which place plaintiffs in the position of being residents of the City of St. Louis.

Plaintiffs assert that their intent to establish a domicile in Clayton should determine their status as residents of the Clayton School District. But mere expression of intention is simply a self-serving statement which does not in itself create evidence of its truth. Any such statement must be received with caution, and when it is in conflict with other evidence, it must always be subordinated to it. As warned by this court in State ex inf. Reardon v. Mueller, supra, 388 S.W.2d 53, 60 (Mo.App.1965): “Intent is a subjective thing. What a man says about it may as easily conceal it as reveal it. It is unrealistic to suppose that a court can penetrate into the obscurities of the human mind and there, with no surer light than that reflected by statements which it is to the litigant’s manifest advantage to make, separate fact from fancy and, with any degree of certainty, lay hands on his true intent. Thus the rule has evolved that where the behavior of the householder is at odds with his professed intent, the former will control, for actions speak louder than words.”

It is clear to us that from the standpoint of both geographical location and objective evidence of intent, the plaintiffs are residents of the City of St. Louis.

Respondents urge upon us the necessity of giving a liberal, broad interpretation of the word “resides” in § 167.151, RSMo 1969, supra, on the basis of the policy as enunciated by the Constitution of the State of Missouri, Article IX, § 1(a), to provide a free education for every child requesting it in a manner so as to open, not to close, the doors of public schools against the children of the state. It is true that the policy of the state is to educate and furnish free of charge good schools for all children of school age. State ex rel. Halbert v. Clymer, 164 Mo.App. 671, 147 S.W. 1119, 1120[1] (1912). But as stated by the court in Halbert at p. 1120[2], it would not be right to permit children living in one district where the taxpayers have neglected or refused to maintain schools to have benefits free of charge in districts where taxpayers have burdened themselves to erect school houses, employ competent teachers and maintain the schools. Certainly the general assembly by statutory enactment has provided for establishment of school districts and has vested these districts with certain powers and duties to carry out the constitutional mandate. School Dist. of Oakland v. School Dist. of Joplin, 340 Mo. 779, 102 S.W.2d 909, 910[1] (1937). But even though children of school age have a fundamental right to attend the public school, this right is to attend the public school established in their district. State ex rel. Halbert v. Clymer, supra; State ex rel. Roberts v. Wilson, 221 Mo.App. 9, 297 S.W. 419, 420[1] (1927). Under the liberal authority given by the legislature, plaintiffs here have the right under § 167.151, supra, to send their children to the schools in the Clayton district even though they do not reside there, but as provided in that statute they receive as a credit on the amount charged for tuition only the school tax that was paid to that district by them.

The judgment heretofore entered by the court is reversed.

DOWD and RENDLEN, JJ., concur.


author: MORGAN, Judge.

text:
    Russell FOHN et al., Respondents, v. TITLE INSURANCE CORPORATION OF ST. LOUIS, a Missouri Corporation, Appellant.
    No. 58859.
    Supreme Court of Missouri, en banc.
    Oct. 13, 1975.
    Rehearing Denied and Modified on Court’s Own Motion Nov. 10, 1975.

      Morgan M. Moulder, Camdenton, for respondents.
    Robert C. Jones, J. William Newbold, Harold A. Tzinberg, Ziercher, Hocker, Tzin-berg, Human & Michenfelder, Clayton, for appellant.
   MORGAN, Judge.

Involved herein is a money judgment against a title insurance company in favor of landowners who had unsuccessfully defended the title to a portion of their lands covered by a policy of the company. The appeal therefrom by the insurer has now been transferred from the Court of Appeals and we consider the same as on original appeal.

On or about the first day of May, 1966, plaintiffs contacted a local real estate broker concerning the prospects of purchasing a certain tract of land in Camden County. The tract contained 24.76 acres, exclusive of highways, and was located about two miles north of Camdenton on State Highway No. 5. The owners resided in Los Angeles, California. The broker handled the transaction by mail and on May 10, 1966, the property was conveyed to plaintiffs by warranty deed for a consideration of $6,400 and the same was filed of record on May 21, 1966.

Shortly thereafter, plaintiffs made application for title insurance with defendant and a policy was issued on June 1, 1966, which insured plaintiffs in the amount of $20,000 against “loss or damage” which they “shall sustain” by reason of “[a]ny defect in . the title” to the property-

Soon after receiving their deed, plaintiffs set to work tearing down fences, cutting brush and clearing the land so that surveyors could plat it for a proposed shopping center and a number of dwelling houses.

At the time of purchase, there were two signs on the property. One advertised Bridal Cave (the entrance to which was directly across new State Highway No. 5) and the other advertised Don’s Boat Dock. An attorney for plaintiffs notified the sign owners that they had to be removed and that of Don’s Boat Dock was; however, a representative of Bridal Cave advised the plaintiffs that “We have a deed to this land.” This occurred subsequent to the issuance of the title policy by defendant. Work continued for a few more days until it was halted by an injunction which followed the filing of a suit by Bridal Cave against plaintiffs. At issue therein was the ownership of a portion of the property described in the warranty deed to plaintiffs and described in the title policy. Plaintiffs notified defendant of the action pending against them and requested defendant to appear and defend the same. Defendant failed to respond in any manner, so plaintiffs hired their own counsel and defended the suit which resulted in a judgment in favor of Bridal Cave. As a consequence, plaintiffs were “perpetually enjoined from asserting any right, title or interest” in and to a .52-acre triangular, portion of the tract — which had provided extensive frontage (559.7 feet) on present State Highway No. 5.

Thereafter, plaintiffs in reliance on their title policy sued defendant for $20,000 damages with interest thereon, $2,000 for vexatious refusal to pay and attorney fees in the sum of $6,200 ($1,200 in the losing effort to defend the title and $5,000 in the present action).

The trial court, sitting without a jury, found “all of the issues for the plaintiffs” and granted the relief prayed for. On appeal, defendant has raised five points of alleged error which will be considered in its order of statement.

First, it is urged that plaintiffs are entitled to no recovery because (a) they did not rely on defendant’s policy in purchasing the land and (b) they failed to disclose to defendant in writing the existence of the Bridal Cave sign as required by the policy of title insurance. Although sub-point (a) appears to be rather frivolous, we recognize the one case cited thereunder. It is Lawyers Title Insurance Corp. v. Research Loan & Investment Corp., 361 F.2d 764 (8th Cir. 1966), which in no way supports the principle suggested. Therein, the court did not deny recovery by the insured because the property was purchased prior to application for the insurance, but because it was found that the insured had “assumed” certain encumbrances (four deeds of trusts) which in view of such agreement were specifically excluded from coverage. The fact plaintiffs did not rely on defendant’s policy in making their purchase is irrelevant. “A present owner who insures his own title, which subsequently proves to be defective, although in fact he has lost nothing because he never did have the interest he supposed he had, may recover for the loss of what he supposedly had . . . ” 45 C.J.S. Insurance § 968, p. 1162. As to sub-point (b), the short answer is that the policy did not require disclosure of signs. “Conditions and Stipulations” thereof did exclude coverage from defects, liens, encumbrances and adverse claims known to the insured and not shown by the public records, but defendant has failed to show that plaintiffs knew about the title defect which existed. They did know of the two signs, in a lake area known for an untold number of signs, but it would be unreasonable to equate the same with knowledge that Bridal Cave or Don’s Boat Dock was vested with a fee simple title to the property by means not reflected in public records. In this connection, the broker testified that: “We just assumed that the signs would be removed whenever we asked them to be removed Normally I don’t have any trouble with signs.” The point is ruled against defendant.

Second, it is urged that the trial court erred in receiving into evidence carbon copies of two letters sent by plaintiffs’ former counsel reference the judgment obtained by Bridal Cave because they violated the best evidence rule. Whether or not such action was erroneous is unimportant in this case for the reason defendant has not challenged the sufficiency of the notice of loss tendered by plaintiffs in compliance with the provisions of the policy. The point is without merit.

Third, defendant urges a two-fold contention: (a) the trial court adopted the wrong measure of damages and (b) plaintiffs failed to submit any credible evidence of loss.

As to (a), defendant’s theory of damages is that plaintiffs can recover only for the value of the .52-acre portion which was lost. Plaintiffs’ theory, on the other hand, is that the proper measure of damages is the difference between the value of the entire tract of 24.76 acres and the value of that part which remained after severance and loss of the .52-acre piece. To sustain its position, defendant quotes a portion of an annotation entitled “Measure, extent, or amount of recovery on policy of title insurance” in 60 A.L.R.2d 972, at 975, to-wit: “In some cases it has been held that for an outstanding interest in fee or for a deficiency in area, the insured could recover the value of the interest or land lost, while in other cases, upon a distinction made between agricultural land and urban property, it has been held that for a deficiency in urban land the insured was entitled to recover not only the value of the land lost, but also indemnity for loss of its use and consequential damages.” Similar observations may be found in 15 Couch on Insurance 2d, § 57:183, pp. 806-807 and 9 Apple-man, Insurance Law and Practice, § 5217, p. 24. Somewhat in contrast is the conclusion reached in 45 C.J.S. Insurance § 967, at p. 1161, wherein it is said: “Ordinarily it [damages] is measured by the difference between the value of the property insured as it was with the defects insured against and its value as it would have been if there had been no such defects.” Nothing could be gained by a detailed discussion of the out-state cases so holding for as said in the A.L.R.2d annotation noted, at p. 978: “The cases contain only a few sporadic statements concerning the criterion of value for measuring an owner’s recovery under a title policy.” Nevertheless, all cases consistently declare that the insured under a title policy is entitled to recover for the “actual loss” suffered.

The question is one of first impression in this state insofar as title insurance is concerned, but it is one having a fixed answer in other areas calling for a determination of damages suffered by the loss of a portion of a tract of land. For instance, in the area of eminent domain the pattern instruction to guide a jury in awarding damages (where part of property is taken) may be found in MAI-9.02. It, in part, provides: “You must award . . . such sum as you believe is . the difference between the fair market value of . [the] whole property immediately before the taking . . . and the value of . [the] remaining property immediately after such taking . . . ” The “difference” thus found is accepted as the “loss” suffered by the owner of the land. The defendant has not suggested, nor has our own research revealed any persuasive reason why the same approach should not be applicable in this instance. Not only does it appear to be the most fair and accurate method, but its adoption in title insurance cases would contribute toward uniformity in the area of assessment of damages. The trial court properly followed the theory advanced by plaintiffs.

In (b) it is argued that plaintiffs failed to submit any credible evidence of loss. We review plaintiffs’ evidence.

A realtor who had been licensed in this state for 20 years, knew the property in issue as he had lived in the Camdenton area his entire life and, in fact, was born and reared within two miles of the same, testified that the original tract was worth $50,-000 or $60,000; and, that the loss of the one-half acre piece along the highway ruined the rest of the tract to such an extent the remainder was worth only $3,000 to $5,000. The witness who had arranged the purchase of the property for plaintiffs had been a real estate broker for 21 years and lived in the area. He testified that the whole tract was worth “$50,000 at least” and the remainder after severance was worth $30,000. The difference of $20,000 was apparently accepted by the trial court. A co-owner of the property gave before and after values of $75,000 and $35,000. Another co-owner gave figures of $100,000 and $56,000, respectively. Defendant offered one witness who estimated the value of the tract lost at $3,500, and he offered no opinion on before and after values.

Of the four opinions elicited on plaintiffs’ behalf, the most conservative was that adopted by the trial court. Very little effort was made on cross-examination to challenge plaintiffs’ witnesses. Nevertheless, it is noted that plaintiffs only paid $6,400 for the entire tract from non-resident (California) sellers. The extent of plaintiffs’ bargain becomes obvious but there is no issue in this case which compels us to reject their right to the benefit thereof. The defendant itself, nearly contemporaneous with the purchase, insured the same for $20,000; and, sometime after the loss of the portion along the highway, the remainder was sold for $37,000. With the record as made, the trial court was not bound by the original purchase price of $6,400 and decided the case on the basis of the extremely good deal obtained. Although not developed, perhaps there are factors outside the record which provide an explanation for the divergent figures. At no time did defendant object to the testimony of plaintiffs’ witnesses on valuation and their qualifications are not in issue. The only attack defendant marshals is against the weight to be given the testimony. The trial court, which had the opportunity to judge the demeanor of the witnesses, ruled in favor of plaintiffs. Deference should be accorded that finding. Furthermore, it should be mentioned that the title insurance policy does not relate any amount recoverable for loss under the policy to the purchase price of the property. The point is ruled against defendant.

Fourth, defendant submits that prejudgment interest should not have been awarded because plaintiffs’ claim was un-liquidated. We agree. Denial of the same is based, generally, on the idea that where the person liable does not know the amount he owes he should not be considered in default because of failure to pay. St. Louis Housing Authority v. Magafas, 324 S.W.2d 697, 700 (Mo.1959); Laughlin v. Boatmen’s Nat. Bank of St. Louis, 354 Mo. 467, 189 S.W.2d 974, 978 (1945); Burger v. Wood, 446 S.W.2d 436, 443 (Mo.App.1969), and, Herbert & Brooner Construction Co. v. Golden, 499 S.W.2d 541, 553 (Mo.App.1973).

Fifth, and lastly, defendant urges that the trial court erred in awarding damages and attorneys’ fees for vexatious refusal to pay because the law of this state does not authorize the same under a title insurance policy. That law may be found in Section 375.420, RSMo 1969, and reads, in part, as follows:

“In any action against any insurance company to recover the amount of any loss under a policy of . indemnity ... or other insurance, if it appear from the evidence that such company has vexatiously refused to pay such loss, the court or jury may, in addition to the amount thereof and interest, allow the plaintiff damages not to exceed ten percent on the amount of the loss and a reasonable attorney’s fee; and the court shall enter judgment for the aggregate sum found in the verdict.” (Emphasis added.)

Being penal in nature, the statute is to be strictly construed; but, where applicable, the judgment may include the amounts authorized. Defendant’s argument that “title” insurance is not specifically mentioned in the statute, and thus the same is not applicable, is rejected. In Southern Title Guaranty Co., Inc. v. Prendergast, 494 S.W.2d 154, 158 (Tex.1973), the court stated that “[t]itle insurance is a contract of indemnity.” In accord, 9 Apple-man, Insurance Law and Practice, § 5217, p. 24 (“A title insurance policy is one of indemnity.”); 15 Couch on Insurance 2d, § 57:179, p. 806 (“Title insurance is solely a contract of indemnity.”); Contini v. Western Title Ins. Co., 40 Cal.App.3d 536, 115 Cal.Rptr. 257[4] (1974); Beaullieu v. Atlanta Title & Trust Co., 60 Ga.App. 400, 4 S.E.2d 78 (1939); Booth v. New Jersey Highway Authority, 60 N.J.Super. 534, 159 A.2d 460[2] (1960); Maggio v. Abstract Title & Mortgage Corp., 277 App.Div. 940, 98 N.Y.S.2d 1011 (1950); Foehrenbach v. German-American Title & Trust Co., 217 Pa. 331, 66 A. 561, 563 (1907), and, Sattler v. Philadelphia Title Insurance Co., 192 Pa.Super. 337, 162 A.2d 22 (1960). We agree with the authorities cited. “Indemnity” insurance is one listed in the statute and the provisions therein are applicable to a title insurance policy.

Did defendant’s conduct qualify as a vexatious refusal to pay? As in any case, the answer must turn on the particular facts presented. It is sufficient to say that it would be difficult to conceive of an insured being more totally abandoned by his insurer than occurred in this case. If there was a legitimate reason, defendant has failed to present it.

The award of interest on the $20,000 pri- or to judgment should be deleted but the same is otherwise affirmed. The cause is remanded for entry of judgment accordingly-

All concur.

      . Counsel presenting defendant’s appeal did not participate in the trial of the cause.