Allis Chalmers Mfg. Co. v. Lewelling

• Decision Date: 09 March 1935
• Docket Number: 31941.
• Citation: 141 Kan. 350,41 P.2d 1032
• Parties: ALLIS CHALMERS MFG. CO. v. LEWELLING et al.
• Court: Kansas Supreme Court

41 P.2d 1032

141 Kan. 350

ALLIS CHALMERS MFG. CO. v. LEWELLING et al.

No. 31941.

Supreme Court of Kansas

March 9, 1935

Syllabus by the Court.

Order of Oklahoma court appointing receiver before filing of action wherein appointment of receiver was sought held void (St. Okl. 1931, § 773).

Suit in Oklahoma court is not deemed commenced, where service is to be obtained by publication, until petition has been filed and first notice of publication had, or where service by publication is first attempted after expiration of sixty days after filing of petition (St. Okl. 1931, §§ 103, 164; Rev St. 1923, 60--308).

To support Oklahoma judgment, where service by publication is had against nonresident, defendant must have some property within state upon which judgment may operate at time service is had (St. Okl. 1931, § 183).

Oklahoma judgment, entered without any personal service or effective service by publication having been had upon defendant, was void and could not be made basis of action or defense in Kansas.

1. Construing section 183 of the Oklahoma Statutes for 1931, it is held, that in order to support a judgment where service by publication is had against a nonresident of the state, there must be some property of defendant within the state upon which the judgment may operate.

2. Where service is to be obtained by publication, a suit is not deemed commenced until a petition has been filed and the first notice of publication had.

3. An action was filed on July 2, 1931. An order appointing a receiver in what purported to be that action was made July 1 1931. Held, the order appointing the receiver was void.

4. Where a judgment of a court of another state was entered without any service having been had upon the defendant and the service by publication was fatally defective, the judgment was void and cannot be made the basis of an action or defense to an action in this state.

Appeal from District Court, Clark County; Karl Miller, Judge.

Action by the Allis Chalmers Manufacturing Company against D. B Lewelling and D. B. Lewelling, doing business under the style and firm name of the Lewelling Grain Company, Englewood Kansas. Judgment for plaintiff, and defendants appeal.

D. W. Buckner, of Gate, Okl., for appellants.

F. N. Cossman, of Ashland, and Austin M. Cowan, C. A. McCorkle, J. D. Fair, W. A. Kahrs, and R. H. Nelson, all of Wichita, for appellee.

SMITH Justice.

While the parties disagree as to the nature of the action in this case, it appears to have originated as one for conversion of wheat, upon which plaintiff claimed to have a chattel mortgage. Plaintiff alleged defendant purchased the wheat from the mortgagor, George Kenneck, after it had notice of plaintiff's mortgage. Plaintiff recovered judgment for the value of the wheat, and defendant appeals.

The mortgagor, Kenneck, was not a party to this action, but was a party to two other actions involving Kenneck and the plaintiff herein. The present action is an outgrowth of those disputes, and the facts in those cases to the extent they bear on the issues before this court will be briefly stated.

It appears Kenneck had purchased farm machinery from plaintiff, executing in payment thereof five promissory notes secured by a mortgage on the machinery; that on January 23, 1931, there was due and owing from Kenneck to plaintiff on these notes the sum of $2,934.67. On this date the indebtedness was extended to June 15, 1931. As consideration for the extension, Kenneck executed to plaintiff a chattel mortgage on growing wheat in Harper county, Okl., which mortgage was duly recorded in Oklahoma. The mortgage was not recorded in Kansas. On June 16, 1931, the indebtedness being due and unpaid, this plaintiff filed an action, No. 3453, in Clark county, Kan., against Kenneck, asking judgment on the indebtedness and foreclosure of the mortgage on the machinery. A receiver was appointed and took possession of the machinery. Kenneck filed an answer on December 6, 1931, in which he alleged an oral extension of the indebtedness until after harvest, and set up failure of consideration for the mortgage on the Oklahoma wheat. This action was determined adversely to Kenneck on March 2, 1932.

While the above-mentioned action, No. 3453, was pending in Clark county and on July 1, 1931, Kenneck filed an action, No. 3176, in Harper county, Okl., against the plaintiff in the above action for cancellation of the mortgage on the Oklahoma wheat; the grounds for cancellation being an assertion of the same facts set up by Kenneck as a defense to the Clark county action, namely, extension of the indebtedness until after harvest and failure of consideration by reason of the Clark county action, No. 3453, being prematurely brought.

The Oklahoma court appointed a receiver who took charge of the wheat. Kenneck took steps to procure service by publication, and on October 27, 1931, the district court of Oklahoma rendered judgment for the plaintiff, Kenneck. This judgment canceled the chattel mortgage and directed the receiver to deliver the wheat to Kenneck.

In July, 1931, the Oklahoma receiver stored the wheat in Kansas with the Lewelling Grain Company at Englewood. During the same month and before the wheat was so stored, the attorney for the plaintiff, the Allis Chalmers Manufacturing Company, notified the grain company that it claimed the wheat under the chattel mortgage. The grain company ignored the notice, and the action, which is now before this court, followed.

The plaintiff alleged the facts of the extension of the indebtedness, execution of the mortgage on the Oklahoma wheat, and the first action between plaintiff and Kenneck. The defendants answered alleging the jurisdiction of the Oklahoma court and set up the Oklahoma judgment canceling the mortgage. Plaintiff replied denying the allegations of the answer inconsistent with plaintiff's petition; denied the validity of the appointment of the receiver by the Oklahoma court; alleged the affidavit for publication service was void and was not filed according to law and was insufficient to give the court jurisdiction; that the publication notice was void and insufficient as a basis of service by publication under the laws of Oklahoma; that the service by publication was without force or effect; that the Oklahoma court had no jurisdiction of either the subject-matter or of the defendants and that the proceeding in Oklahoma was not in rem but one in personam; that the judgment and proceedings in the district court of Harper county, Okl., and each and every step therein taken, was void. Plaintiff further replied the wheat was placed in defendant's elevator in Kansas and defendant had knowledge of plaintiff's claim; that the Oklahoma receiver had no authority in Kansas.

Plaintiff's evidence consisted of the files and transcript in the first Clark county action, No. 3453, the original mortgage, and some oral testimony of notice to defendant and as to value of the wheat. Defendant introduced authenticated copies of the records in the Oklahoma case. Excepting oral testimony of notice and value of wheat, the evidence was all documentary, consisting of the pleadings, order, and exhibits in the first two actions involving this plaintiff and Kenneck.

Trial was by the court, which overruled defendant's demurrer to plaintiff's evidence, and rendered judgment November 9, 1933, for plaintiff.

Defendant says the court erred in overruling defendant's demurrer to plaintiff's evidence, in refusing to give full faith and credit to the Oklahoma judgment, and in rendering judgment for plaintiff.

The plaintiff makes an argument here in line with the allegations of its reply, which has been heretofore noticed. The first argument is that the order appointing a receiver was void. Plaintiff points out the action was filed July 2, 1931. The order appointing the receiver was made July 1, 1931. It will be seen the receiver was appointed at a time when there was no action pending. Plaintiff argues that on this account the order was void.

The case of In re Sharp, 87 Kan. 504, 124 P. 532 Ann.Cas. 1913E, 460, is relied on. In that case a temporary injunction was issued two or three days before the action in which the injunction was asked for was filed. This court examined the provisions of the Code, which provide for a temporary injunction at the time of commencing the action, and held that since the injunction was issued before the action was...