Bank of Kirksville v. Small, 69148

• Decision Date: 15 December 1987
• Docket Number: No. 69148,69148
• Citation: 742 S.W.2d 127
• Parties: BANK OF KIRKSVILLE, Respondent-Appellant, v. Jimmie SMALL, Appellant-Respondent.
• Court: Missouri Supreme Court

Page 127

742 S.W.2d 127

BANK OF KIRKSVILLE, Respondent-Appellant, v. Jimmie SMALL, Appellant-Respondent.

No. 69148.

Supreme Court of Missouri,

En Banc.

Dec. 15, 1987.

Rehearing and/or Motion to Dismiss Appeal Denied Jan. 20, 1988.

Russell E. Steele, Kirksville, for appellant-respondent.

Jay Benson, Kirksville, for respondent-appellant.

RENDLEN, Judge.

Suit on a promissory note. Plaintiff in Count I of its petition sought enforcement of a note dated May 25, 1972, alleging a balance due of $3,690.21 plus interest from December 4, 1981 and attorney's fees. Count II requested replevin of a mobile home alleged to be security for payment of the note.

Defendant denied the allegations of plaintiff's petition and asserted as affirmative defenses: payment; breach of contract; fraud in the inducement; and violations of the Motor Vehicle Time Sale Law and the Truth in Lending Act. Additionally, defendant counterclaimed for damages stemming from plaintiff's alleged fraudulent representations in connection with the loan transaction and by separate Count prayed damages for violation of the Truth in Lending Act. The latter was dismissed by the court prior to trial.

As to plaintiff's claim on the note (Count I), a verdict was directed by instruction number 7 providing in pertinent part, "[y]our verdict must be for plaintiff on plaintiff's claim for payment of the promissory note," but despite that mandate the jury returned a defendant's verdict. Plaintiff's claim for replevin (Count II) also resulted in a verdict for defendant and the court entered judgment for defendant on both counts in conformity with the jury's verdicts. ¹ It is only the judgment as to plaintiff's Count I which remains for consideration in this appeal.

It should be noted at the outset that the verdict submitted on Count I was inconsistent with Instruction No. 7 in that it allowed the jury to find for defendant.

VERDICT A

Note: Complete this form by writing in the name required by your verdict.

On the claim of plaintiff, Bank of Kirksville, against defendant, Jimmie Small, for payment of the promissory note, we, the undersigned jurors, find in favor of:

Jimmie Small

[The jury entered defendant's name in the blank provided on the form.]

(Plaintiff, Bank of Kirksville) or (Defendant, Jimmie Small)

Note: Complete the following paragraph only if the above finding is in favor of plaintiff, Bank of Kirksville.

We, the undersigned jurors, assess the damages of plaintiff, Bank of Kirksville, at $______.

Plaintiff lodged no objection to the verdict prior to release of the jury but raised the point in its post-trial motion for judgment notwithstanding the verdict or alternatively, for new trial, claiming error in the jury's refusal to follow Instruction No. 7. This motion lay dormant for more than 90 days and accordingly was ruled against plaintiff.

The cause was transferred here by the Court of Appeals--Western District to determine whether Douglass v. Safire, 712 S.W.2d 373 (Mo. banc 1986), bars plaintiff's right to pursue its allegation of error in the circumstances of this case. For reasons now discussed we hold that it does not.

The rule in Douglass requires that a party object to inconsistent verdicts before the jury is discharged or, failing so to do, be deemed to have waived the error, but the rule applies in those cases where the intent of the jury cannot be ascertained from the face of the verdict or which incorporate two or more contradictory findings. ² An example is found in Jenkins v. McShane, 539 S.W.2d 752 (Mo.App.1976) where the jury found for plaintiffs on their suit to enforce a promissory note but awarded damages in the amount of zero dollars and because the jury's intent could not be determined from the verdict, id. at 754, the trial court was required to resubmit the issue. A verdict suffering such defect is correctable not by the court but by the jury that returned it, and as noted above the issue must be resubmitted to the jury or the defect is waived. Douglass, 712 S.W.2d at 374.

Here, because the verdict for defendant was violative of the instruction, it was legally impermissible and the court was free to disregard it. In State ex rel. Witte Hardware Co. v. McElhinney, 100 S.W.2d 36, 38 (Mo.App.1937), the court faced substantially the same issue presented by this appeal. That was a case in which plaintiff sued to enforce a promissory note and the trial court gave its peremptory instruction directing a plaintiff's verdict. On the jury's refusal to follow the court's instruction a mistrial was ordered and plaintiff, dissatisfied with that result, sought mandamus to require entry of judgment in its favor. The Court of Appeals issued its writ, holding that when the jury returned a verdict contrary to the mandatory verdict directing instruction the trial court was free to disregard it and enter judgment for the party in whose favor the verdict had been directed.

A legally impermissible verdict is a nullity, without legal effect; such verdict has been described as the product of a jury lacking in authority to render it. McElhinney, 100 S.W.2d at 36. A judge's decision to direct a verdict for one party represents a determination that as a matter of law the evidence in the case is insufficient to support the claim or the defense of the party against whom the verdict is directed. In so doing the judge does not pass on the weight of the evidence; rather, he rules as a matter of law that no verdict is legally permissible under the evidence other than the verdict he directs.

The jury in a directed-verdict case departs from its usual function of passing on the weight of the evidence and

acts only formally, perfunctorily, and ministerially as the instrument by which the court prepares the orderly record which will support the only judgment that can lawfully be rendered in the case. Under such circumstances, though the act of returning a directed verdict purports to be that of the jury, it is in legal effect the act of the court itself, and the function of the jury in returning a directed verdict is as much ministerial as is the act of the clerk of the court in subsequently entering up the judgment based thereon.

McElhinney, 100 S.W.2d at 38. The jury's presence is not required to correct a verdict flatly contrary to a trial court's instruction mandating a specific result, for the court alone possesses the authority to correct such legally impermissible verdict, and requiring an aggrieved party to request resubmission of the issue would serve no purpose. The aggrieved party may reserve his objection for post-trial proceedings.

We must next determine whether the trial court erred in the first instance by mandating a plaintiff's verdict and if not, by thereafter denying plaintiff's motion for judgment notwithstanding the verdict or for a new trial. Stated otherwise, if the trial court's initial decision to direct a verdict in favor of plaintiff on Count I of its claim was correct, then was it not obligated to grant plaintiff's motion for judgment notwithstanding the verdict?

A directed verdict is a drastic action to be taken sparingly and only where "reasonable men in an honest and impartial exercise in their duty could not differ on a correct disposition of the case." Stogsdill v. General Am. Life Ins. Co., 541 S.W.2d 696, 698 (Mo.App.1976).

[Although] '[i]t is a generally accepted rule in this state that a verdict may not be directed in favor of the proponent, that is the party upon whom the law casts the final burden of proof ... [t]here is, however, a well [recognized] exception to the rule. If the opponent that is the party not having the burden of proof, admits either in his pleadings or by counsel in open court or in his individual testimony on the trial the truth of the basic facts upon which the claim of the proponent rests, a verdict may be directed against him, and if the proof is altogether of a documentary nature and the authenticity and correctness of the documents are unquestioned, and if such proof establishes beyond all doubt the truth of facts which as a matter of law entitled the proponent to the relief sought, and such proof is unimpeached and uncontradicted, the proponent will be entitled to a peremptory instruction. This is upon the theory that there is no question of fact left in the case and that upon the questions of law involved the jury has no right to pass. * * * ' Rogers v. Thompson, 364 Mo. 605, 265 S.W.2d 282, 287; Prevost v. Wilkin, Mo.App., 358 S.W.2d 417 [1, 2]; Curry and Company v. Hedrick, Mo. 378 S.W.2d 522 at 531.

Cited by the Court in Commerce Trust Co. v. Howard, 429 S.W.2d 702, 707 (Mo.1968).

In a suit on a promissory note plaintiff makes a prima facie case when the note admittedly signed by the makers is introduced into evidence and there is evidence to show that the note is unpaid or there is a balance due and owing. Section 400.3-307(2) RSMo 1965, provides that when signatures are admitted or established, production of the instrument entitles a holder to recover on it unless the defendant established a defense. The Uniform Commercial Code Comment, 20A V.A.M.S. p. 602 with respect to this section of the Code states: "Once signatures are proved or admitted, a holder makes out his case by mere production of the instrument, and is entitled to recover in the absence of any further evidence. The defendant has the burden of establishing any and all defenses, not only in the first instance but by a preponderance of the total evidence."

Beneficial Fin. Co. of St. Chas. v. Kitson, 530 S.W.2d 497, 502-503 (Mo.App.1975).

Our examination of the record discloses that the verdict directing instruction was proper. The document which plaintiff sued to enforce was titled "Security Agreement Non-Motor Vehicle Retail Installment Contract" and the bottom portion of the document, delineated by a dotted line, was styled "Note." The principal sum recited in the note was $14,457.40 and four...