Grace, Arnold and Murray v. Koppel

• Decision Date: 16 June 1930
• Docket Number: No. 16951.,16951.
• Citation: 30 S.W.2d 182
• Parties: T.J. GRACE, H.A. ARNOLD and E.A. MURRAY, APPELLANTS, v. GEORGE KOPPEL, RESPONDENTS.
• Court: Missouri Court of Appeals

30 S.W.2d 182

T.J. GRACE, H.A. ARNOLD and E.A. MURRAY, APPELLANTS, v. GEORGE KOPPEL, RESPONDENTS.

No. 16951.

Kansas City Court of Appeals. Missouri.

June 16, 1930.

Appeal from Circuit Court of Jackson County. — Hon. Darius A. Brown, Judge.

REVERSED AND REMANDED.

Wm. B. Dickinson, Alfred D. Hillman and Martin B. Dickinson for appellants.

Reinhardt & Schibsby for respondent.

BOYER, C.

This is a suit to enforce the collection of a special tax bill issued by the city of Kansas City, Missouri, against the property of defendant to pay for street paving in a total amount of $1131.96.

The evidence shows the tax bill was No. 16, issued under ordinance No. 49833, to the W.C. Mullins Construction Company, a corporation, the contractor doing the work. It was issued June 19, 1925, and was payable in four equal installments of $282.99; the first installment being due June 30, 1926, and the remainder of the installments due in one, two, and three years after the due date of the first installment.

On July 22, 1925, defendant paid to the Mullins Company on said tax bill the sum of $831.99. Prior to that time, defendant had some conversation with the president of the company and it was agreed that he should have two per cent reduction for cash payment and that he should pay three-fourths at that time and the remainder later. Some time in the fall of the year 1926, defendant called at the office of the Mullins Company to settle the remainder of the bill and was informed by the cashier or bookkeeper, named Madden, that the bill had been misplaced, but that he would get it and to come in later, and thereafter was put off from time to time with the excuse that the bill could not be found; and thereafter, on January 21, 1927, the defendant met Madden in the office of the city treasurer at Kansas City, for the purpose of settlement. Defendant had advised with the city treasurer who directed him to bring some representative of the company to the office. Madden accompanied defendant to the office of the city treasurer and there made the statement that he could not get the bill, and when asked whether he would make an affidavit that it was lost said that he would, but instead of making the affidavit he signed a statement which was endorsed upon the special tax record in the city treasurer's office, which reads as follows:

"This is to certify, That we are the owners of, and have received payment in full on tax bill 16 Inst. in full Street Pave 46th St., Ord. 49833. This satisfaction is made at the request of owner, the tax bill having been lost. By S.S. Madden, Cashier. Attest. M.E. Carey. Date Jan. 21, 1927."

Defendant then paid the further sum of $243.38 to Madden. All payments made by defendant were received by the Mullins Company. It was shown by defendant, over the objection of plaintiffs, and by the testimony of Mr. Carey, the city treasurer, that it had long been a custom in his office to make similar entries upon the payment of tax bills which had been lost. This custom had prevailed for at least seventeen years, and the city treasurer had a rubber stamp prepared for that purpose and the endorsement on the special tax record was done by use of the stamp and by filling in the blanks to conform to the facts.

The evidence further disclosed that on December 1, 1924, the W.C. Mullins Construction Company entered into a trust agreement with the Central Trust Company of Illinois as trustee. This contract covers over forty pages of the record. The main object and purpose of it was to provide means for securing bonds of the Construction Company in a large amount, by the assignment, transfer, and deposit with the trustee of special tax bills issued by Kansas City. The company was required to deposit with the trustee 112½ per centum of the total principal amount of the bonds from time to time outstanding. This percentage was to be maintained either by the deposit of the face amount of tax bills, or tax bills and cash. Under the terms of the trust agreement, one H.M. Cammack was to approve the tax bills so received. $150,000 of a given series of bonds was authorized, issued, and sold under authority of the Mullins Company, by H.M. Cammack. Part of the proceeds were deposited with the trustee to be held as a cash deposit with tax bills to secure the payment of the bonds.

Under date of July 10, 1925, in pursuance to the trust agreement, the Mullins Company transmitted a large amount of tax bills to the trustee, including the tax bill in suit. The tax bill bore an assignment executed by the construction company. The blank form of assignment was not filled up, but merely signed in blank as printed. The transfer and deposit of this tax bill, according to the dates shown, was made twelve days before the defendant made any payment to the construction company. It remained in the hands of the trustee until August 31, 1928, on which date, on account of the default of the construction company under the trust agreement, the trustee sold and assigned all of the tax bills remaining in its hands, including the one in suit, which had been deposited with it, to secure the payment of bonds of the construction company. The trustee reported the sale to the company and further notified it that there was then on deposit with the trustee for payment to the holders of the bonds a sum equal to $44.34 for each $100 of principal amount of said bonds.

The tax bill in suit, together with others, was sold and transferred by the trustee to plaintiff Grace, and it is stipulated by the parties to the suit that in the purchase of this and other tax bills Mr. Grace was acting for himself and the other plaintiffs mentioned in the petition, and that plaintiffs are now the owners of whatever rights they may have acquired under said purchase.

The first knowledge that defendant had that the plaintiffs or any one else claimed any right under the tax bill was obtained by him when he received a letter some time in September, 1928, from an attorney in Chicago, demanding payment of the bill. No notice had been served upon him of the assignment, nor filed in the office of the city treasurer.

Other facts in evidence will be referred to in a consideration of the points raised on appeal.

The petition is in usual form, describing the procedure and authority for, and the issuance of the tax bill, the receipt thereof by the construction company, ownership by plaintiffs, the property against which it was issued, and stated that defendant owns or is interested in the property. The tax bill is made a part of the petition.

The answer was a general denial of all allegations except facts admitted. It further recites that defendant paid the construction company the sum of $831.99 on July 22, 1925, upon said tax bill, and on January 21, 1927, paid the remainder thereof in full in the sum of $243.38; that on said date the records were satisfied in the office of the city treasurer of Kansas City, Missouri, and the satisfaction thereof attested by the city treasurer; that prior to the last payment made by defendant, he had no knowledge of the assignment of the tax bill; that no notice of assignment had been given at the office of the city treasurer; and that in fact no assignment of the bill had been made by the construction company. The answer further alleged that the construction company was authorized by the holders of the tax bill to collect the money due thereon and transmit the proceeds to the holder, and that in pursuance of such authority the construction company collected the money due on the bill as the agent of the holder.

The reply was a general denial except such facts as were admitted in the petition.

The case was tried to the court without a jury (no mention being made thereof) and submitted without declarations of law or request for findings of fact and conclusions of law stated separately.

The court first entered a judgment which contained five special findings of fact and ordered and adjudged that plaintiffs take nothing; that the tax bill be cancelled and marked paid, and that the property be discharged from any lien by reason of it. Thereafter, the court set aside said judgment and re-entered same, omitting the findings of fact, but making a general finding of the issues for the defendant. From this judgment plaintiffs duly appealed.

Appellants contend that the judgment should have been for the plaintiffs because (1) defendant did not show a valid release on the record, (2) and did not show payment to the owner of the tax bill, (3) defendant failed to show that the Mullins Company was the agent of the trustee for the collection of the tax bill, and (4) that plaintiffs' title was perfect. Appellants also assign error in the admission of testimony of the city treasurer concerning a custom for the release of tax bills said to be lost.

OPINION.

As preliminary to a discussion of points raised on appeal, it is suggested by appellants that this is an action to foreclose the lien of a special tax bill, consequently a proceeding in equity, and that disposition of the case on appeal will be made accordingly. The authority cited is Bates v. Comstock Realty Co., 306 Mo. 312. Upon an examination of this case, and others, it is apparent that the statement of appellants must be qualified. A suit to enforce a special tax bill is not always a proceeding in equity. It is usually an action at law. The exception arises where the city charter, or the statute, provides no adequate method for the enforcement of the lien of the tax bill, or where special circumstances call for equitable relief. [Schmidt v. Pitluck, 26 S.W. (2d) 859, 861, and cases there cited.]

From an examination of the provisions of the charter of Kansas City, referred to by appellants and by ...