Carter v. Butler

• Decision Date: 03 March 1915
• Citation: 174 S.W. 399,264 Mo. 306
• Parties: J. W. CARTER, Trustee, v. JAMES J. BUTLER, Executor, et al., Appellants
• Court: Missouri Supreme Court

174 S.W. 399

264 Mo. 306

J. W. CARTER, Trustee, v. JAMES J. BUTLER, Executor, et al., Appellants

Supreme Court of Missouri

March 3, 1915

Appeal from St. Louis City Circuit Court. -- Hon. W. B. Homer Judge.

Affirmed.

Thomas K. Skinker and Barclay, Orthwein & Wallace for appellants.

(1) The petition does not state a cause of action in omitting to state facts to show that plaintiff is the holder of the note. The petition avers the title to the note to be in the Bank of Commerce by regular indorsement. Spears v. Bond, 79 Mo. 467; R. S. 1909, sec. 10004. This point is never waived. Lilly v. Menke, 126 Mo. 190. (2) The evidence of plaintiff shows that the title to the note is in the National Bank of Commerce by regular indorsement, which, under the Negotiable Instruments Law, makes this plaintiff an improper party to maintain this action. R. S. 1909, sec. 10004. (3) Suit on such a note must be brought by the real party in interest, otherwise the defendants would not be protected by payment to another. Wells v. Moore, 68 Mo.App. 501; Spears v. Bond, 79 Mo. 467. (4) Where an answer sets up plea of failure of consideration in a note (because given for a defective title) and there is a general denial thereof by the reply, the "issue made by the replication to the defendant's answer was the only issue to be tried." The issues of the pleadings are those on which alone the cause should be tried and determined. Stewart v Hadley, 55 Mo. 245; Northrup v. Ins. Co., 47 Mo. 435; Musser v. Adler, 86 Mo. 449. (5) It was error by the learned trial Judge, by the instruction given of his own motion, to spring a new theory of the case, outside the issues of the pleadings, and outside the evidence, action and theory of both parties at the trial, because both parties are bound and limited by the theory on which the cause was actually shaped in the pleadings and tried under them. The rule that a party is limited on appeal to the theory on which he tried the case in the lower court is established by many decisions, of which only a few are cited, as it is familiar law here. Whetstone v. Shaw, 70 Mo. 575; Walker v. Owen, 79 Mo. 568; Minton v. Steele, 125 Mo 181. That decisive instruction was further erroneous because there is no proof that defendants "were put in possession of said mining claims." On the contrary one of the payees was shown to be in possession; and if not personally, then as representative of another company (the National Copper Mining Co.) in which he and Dr. Westlake and others were all interested. It is error to give an instruction not supported by the testimony. (6) Under the Missouri statute (changing the older English rule) a plea of failure of consideration (in whole or in part) is permissible in an action on a note, without returning the property for which the note represents the purchase price. Our law on this subject is and was intended to change the prior rule of the British law on that subject. R. S. 1909, sec. 1974; Danforth v. Crookshanks, 68 Mo.App. 315; Brown v. Weldon, 99 Mo. 564. The purpose of that Missouri rule is to avoid circuity of action and multiplicity of suits. That purpose as well as the statute itself has been inadvertently overlooked in one or two exceptional cases which are out of line with the statute and with many analogous decisions involving the law of sales, where the property has been delivered to the vendee. R. S. 1909, sec. 1974; Brown v. Welden, 99 Mo. 564; Danforth v. Crookshanks, 68 Mo.App. 317; Werner v. O'Brien, 40 Mo.App. 483. (7) A rule which has been stated in some early cases in Missouri to the effect that in a suit for the purchase money of land the defendant (while retaining possession) cannot defend on the ground of defective title, is unsound in principle as it ignores our statute. R. S. 1909, sec. 1974. It has been denied in many cases as applied to personal property, although there is no difference in principle as we can discern between the two subjects. Hannah Co. v. Holley Co., 140 S.W. 923; 30 Am. & Eng. Ency. Law (2 Ed.), 209; Brown v. Weldon, 29 Mo. 564; Smith v. Means, 155 S.W. 454; Crenshaw v. Looker, 185 Mo. 388; Sinnamon v. Moore, 161 Mo.App. 168; Sanders v. Mosbarger, 141 S.W. 720; Stark Co. v. Mayhew, 141 S.W. 433; Shephard v. Padgitt, 91 Mo.App. 473; Ferguson Co. v. Farmer, 128 Mo.App. 300; Broderick v. Andrews, 135 Mo.App. 57; Mobile v. Nelson, 154 Mo.App. 616; Branson v. Turner, 77 Mo. 489; Miles v. Withers, 76 Mo.App. 87; Jones v. Shaver, 6 Mo. 642; Benton v. Klein, 42 Mo. 97; Keith v. Hobbs, 69 Mo. 84; Wade v. Scott, 7 Mo. 509; Jolliffe v. Collins, 21 Mo. 338. (8) The nature of mining lodes is so close akin to that of the ore which forms the chief value thereof, that the rule of law as to such property is thus stated: "The purchaser of a mine, who buys under a contract for a future title, even though he takes possession of the mine and manages the property, if it was the intention of the parties that he should immediately take possession, this will not constitute a waiver of objections to a defect in the title by the purchaser." White, Mines (1903), sec. 95, p. 126; Stephens v. Guppy, 3 Russ. 171; Babcock v. Case, 61 Pa. St. 427; Tuck v. Downing, 76 Ill. 71. In cost book companies: Curling v. Flight, 2 Phil. 614.

Bishop & Cobbs for respondent.

(1) Defendants' objection to the petition cannot be sustained. (a) Because an objection to the introduction of testimony on account of alleged insufficiency of petition comes "too late to deserve favorable consideration." Storage Co. v. Kuhlmann, 238 Mo. 703; Goldsmith v. Candy Co., 85 Mo.App. 600. (b) Because the petition is sufficient. It is based on a promissory note and alleges possession under written assignment. It is not necessary to use the term "holder." Possession alone is prima-facie evidence of right to sue, but plaintiff alleged and proved not only possession but also authority from owners to collect. Sec. 10021, R. S. 1909; Boeka v. Nella, 28 Mo. 180; Morris v. Morris, 28 Mo. 114; Lewis v. Bowen's Admr., 29 Mo. 202; Davis v. Carson, 69 Mo. 609, l. c. 610; Dawson v. Wombles, 123 Mo.App. 345. (2) The bank has no title to or interest in the note. Plaintiff alleged and proved that the note was indorsed and delivered to bank for collection only. After protest, the bank returned the note to payees, who were liable to bank as indorsers, and who, after taking the note back, delivered it to plaintiff under written assignment. (a) Indorsement to bank could have been stricken out. Sec. 10018, R. S. 1909. Section 10004 is not in conflict with section 10018. (b) Indorsement to bank was properly disregarded. Beattie v. Lett, 28 Mo. 597; Bank v. Fesler, 89 Mo.App. 224. (3) This suit was brought by the "real party in interest." Plaintiff was trustee of an express trust under the assignment in evidence, and was the only proper or necessary party. Sec. 1730, R. S. 1909; Snider v. Express Co., 77 Mo. 527; Springfield for use v. Weaver, 137 Mo. 670; Bank v. Edwards, 84 Mo.App. 469; Gerney v. Moore, 131 Mo. 668; Barnes v. McMullins, 78 Mo. 277; Barber v. Stroub, 111 Mo.App. 60; Greer v. Zinc Co., 126 Mo.App. 173; Johnston v. O'Shee, 118 Mo.App. 293; Simmons v. Wittmann, 113 Mo.App. 374; Jones v. Railroad, 178 Mo. 542; Lee v. Railroad, 195 Mo. 519; Sawyer v. Railroad, 156 Mo. 475. (4) The case was tried and decided on the only real issues involved. The allegation in answer that title "was not sound and good" is not sufficient as a plea of total failure of consideration. Failure of consideration must be properly pleaded to be considered. Here it was neither properly pleaded nor proved. (a) The note was prima-facie evidence of consideration. Sec. 9995, R. S. 1909. (b) Failure of consideration is a matter of defense to be properly pleaded and proved by defendants. Sec. 9999, R. S. 1909; Holmes v. Farris, 97 Mo.App. 311. (c) The burden of proving total failure was on defendants. Thompson v. Crutcher, 26 Mo. 321; Kent v. Miltenberger, 13 Mo.App. 513. (d) Plea of defect in title only, without alleging and proving dispossession, is not sufficient as a total failure of consideration. Pershing v. Canfield, 70 Mo. 143; Cartwright v. Culver, 74 Mo. 182; Davis v. Watson, 89 Mo.App. 26; Hunt v. Marsh, 80 Mo. 398. (5) No new theory was sprung by trial court. Changes in theory apply only on appeal, not to trial courts. The question of possession of the mining claims was in the case from the beginning and was properly submitted to the jury. The instructions given were in exact accordance with the law and the evidence. (a) Mining claims are real estate. Mining & Smelting Co. v. Rucker, 28 F. 221; McFeters v. Pierson, 15 Colo. 203; Manuel v. Wulff, 152 U.S. 510; Hardware Co. v. Frank, 25 Mont. 348; State v. District Court, 24 Mont. 332; Harris v. Equator M. & S. Co., 8 F. 866; Melton & Fisher v. Lambard, 51 Cal. 259. (b) The receipt of title imports receipt of possession. Clark v. Ins. Co., 52 Mo. 276; 13 Cyc. 572, 6, d. (c) The burden was on defendants to prove that they had not received possession, or that they had been dispossessed. Thompson v. Crutcher, 26 Mo. 321; Holmes v. Farris, 97 Mo.App. 311; Tow Co. v. Orphius B. I. Co., 52 Mo.App. 529; Knoche v. Whittman, 86 Mo.App. 568. (d) Defendants received and held possession of mining claims. They did not deny possession, and their possession was taken for granted throughout trial. They admit in their answers that the mining claims were transferred to them. Change of possession is implied, especially in mining claims. The contention that Laughlin (one of the payees) was in possession falls, because he was shown to be employed by defendants. McManus expressly admitted possession. If defendants had not been in the possession and enjoyment of these claims, they would have pleaded want of possession and asked a return...