Land Clearance for Redevelopment Authority of City of St. Louis v. Zitko, 49980

• Decision Date: 14 December 1964
• Docket Number: No. 49980,49980
• Citation: 386 S.W.2d 69
• Parties: LAND CLEARANCE FOR REDEVELOPMENT AUTHORITY OF the CITY OF ST. LOUIS, Plaintiff, v. Georgia ZITKO et al., Defendants, St. Louis Argus Publishing Company, a Corporation, and Nannie Mitchell Turner, Defendants-Respondents, Edwina W. Mitchell, Intervenor-Appellant.
• Court: Missouri Supreme Court

Page 69

386 S.W.2d 69

LAND CLEARANCE FOR REDEVELOPMENT AUTHORITY OF the CITY OF ST. LOUIS, Plaintiff, v. Georgia ZITKO et al., Defendants St. Louis Argus Publishing Company, a Corporation, and Nannie Mitchell Turner, Defendants-Respondents Edwina W. Mitchell, Intervenor-Appellant.

No. 49980.

Supreme Court of Missouri, En Banc.

Dec. 14, 1964.

Rehearing Denied Jan. 11, 1965.

Sidney R. Redmond, Henry D. Espy, St. Louis, for appellant.

David M. Grant, St. Louis, for respondents.

STORCKMAN, Judge.

This is an ancillary proceeding to determine the distribution to be made of the sum of $43,500 paid into court as compensation for the taking by condemnation of the land and improvements numbered 2312-14-16 Market Street in the City of St. Louis. The condemnation action proper has been concluded at least as far as this particular property is concerned. The defendant St. Louis Argus Publishing Company, a corporation, claims the entire fund as sole owner at the time the real estate was taken by the plaintiff Land Clearance for Redevelopment Authority as a part of the Mill Creek redevelopment project. The intervening defendant Edwina W. Mitchell claim 4/9ths of the fund. She claims 2/9ths as a former shareholder of Mitchell Realty and Investment Company, a corporation, now defunct by reason of the forfeiture of its charter. She claims an additional 2/9ths of the fund as the residuary legatee under the will of her husband who was also a shareholder of the Mitchell Company. The defendant Nannie Mitchell Turner, also a shareholder in the Mitchell Company, disclaims any interest in the fund and supports the claim and contentions of defendant St. Louis Argus Publishing Company. The trial court heard the case without a jury, found the issues against the intervenor Edwina W. Mitchell, and held that St. Louis Argus Publishing Company was entitled to the entire fund. The intervenor has appealed.

The cause was heard on the first amended intervening petition of Edwina W. Mitchell and the second amended cross-complaint of the St. Louis Argus Publishing Company, a corporation, and responsive pleadings. For convenient reference and ease of distinction, the land and improvements condemned will sometimes be referred to as the Argus property or building; the St. Louis Argus Publishing Company will sometimes be referred to as Argus or the Argus Company; the Mitchell Realty and Investment Company as Mitchell Company; Mrs. Edwina W. Mitchell as Mrs. Edwina or the intervenor; and Mrs. Nannie Mitchell Turner as Mrs. Nannie.

The Argus Company relies on corporate minutes and a recorded deed of Mitchell Company as the basis of a claim under color of title and predicates its title on adverse possession, estoppel and laches, and prays that the title be quieted. The intervenor contends the recorded deed is invalid, that it is a cloud on the title and should be declared void. She also seeks an accounting of the rents and the proceeds of fire insurance coverage on the building. Apart from other possible grounds, appellate jurisdiction is in this court because of the amount in dispute since the 4/9ths of the fund claimed by the intervenor is at least $19,115. Art. 5, Sec. 3, Constitution of Missouri 1945, V.A.M.S.; Sec. 477.040, RSMo 1959, V.A.M.S.

It is undisputed that Argus Company originally acquired the real estate in question on May 11, 1922, by a warranty deed duly recorded. It occupied the first floor of the premises for the publication of the St. Louis Argus, a leading Negro newspaper in St. Louis. Offices on the second floor were rented to various tenants. Argus Company lost the property through foreclosure in 1939. On October 3, 1939, the sheriff of the City of St. Louis, as successor trustee under a deed of trust, conveyed the property to Lena Traub, the purchaser at the foreclosure sale. In this connection Argus Company also executed and delivered a quitclaim deed dated September 30, 1939, to Lena Traub who was the holder of the notes and deed of trust on the property. By a general warranty deed dated February 17, 1942, Lena Traub conveyed the property to Mitchell Realty and Investment Company, a corporation. The balance of the purchase price was secured by a deed of trust.

Mitchell Realty and Investment Company was organized as a Missouri corporation on February 6, 1942. The shareholders named in the articles of agreement were Joseph E. Mitchell, Edwina Mitchell, William Mitchell and Nannie Mitchell, each the holder of four shares, and George L. Vaughn, the holder of two shares. These five shareholders also constituted the first board of directors. The capital stock of $2000 was divided into 20 shares of the par value of $100 per share; half of the capital was paid in money to the persons named as the first board of directors. J. E. Mitchell and William Mitchell were brothers. Nannie Mitchell was the wife of William. J. E. Mitchell, a widower, married Edwina in 1940. George L. Vaughn, a lawyer, represented the parties at the time. The charter of the Mitchell Company was forfeited by the secretary of state on January 1, 1946, for failure to file its annual registration statement and antitrust affidavit.

Over the objection of the intervenor, the respondents introduced in evidence a document purporting to be a set of corporate minutes of Mitchell Company and a general warranty deed from Mitchell Company purporting to convey the real estate in question to the Argus Company. The minutes, respondents' exhibit G, purported to record the proceedings of a meeting of the Board of Directors of Mitchell Company held 'At ___ o'clock __ m, October ___, 1944,' and recited, inter alia:

'The chairman announced that the business of the meeting to come before the directors at this time was the question of selling the property belonging to the company and located at 2312-14-16 Market Street in the City of St. Louis and State of Missouri to the St. Louis Argus Publishing Company, and the liquidation of the debt on said property to the extent of the amount of money on hand by applying the same on the incumbrance on said property.

'The property above referred to is more particularly described as follows:

[Legal description omitted.]

'Subject to the balance due on a deed of trust now of record, and to the restrictions and conditions and easements of record.

'The following resolution was then offered:

'Be it resolved, That the above described property by this day sold to the St. Louis Argus Publishing Company for the sum of Ten Dollars and other valuable considerations, including the assumption of the balance of the incumbrance on said property, after deducting the amount of the payments to be made thereon by this company, and be it further resolved that the Mitchell Realty and Investment Company shall apply and pay on the liquidation of said encumbrance the entire amount of money now on hand and belonging to said company, including said ten dollars to be received from said St. Louis Argus Publishing Company.'

The warranty deed, respondents' exhibit C, dated May 27, 1950, and filed and recorded in the office of the Recorder of Deeds of the City of St. Louis on June 20, 1950, purported to convey the property from Mitchell Realty the Investment Company, a corporation, to the St. Louis Argus Publishing Company, a corporation. The minutes, exhibit G, purported to be signed by William Mitchell as chairman and attested by Edwina W. Mitchell as secretary. A waiver of notice appended thereto, purported to be signed by the five directors named in the articles of incorporation of Mitchell Company, including Mrs. Edwina. The deed, exhibit C, purported to have been signed by Mrs. Edwina as president of Mitchell Company. She denied that she signed either document and asserted that she was not in St. Louis during October 1944. These two instruments will be further discussed in connection with Mrs. Edwina's claim of error with respect to their admission.

The Argus Company continued to occupy the first floor of the building as business quarters for the publication of its newspaper until April 4, 1961, when the condemnor took possession and the Argus Company moved to new quarters at 4595 Easton Avenue. While in possession of the property from 1950 until it moved in 1961, and prior thereto, the Argus Company paid no rent to Mitchell Company or anyone else. It collected the rents from the officers upstairs and kept the proceeds as a part of its own funds. It made and paid for improvements to the building and paid the real estate taxes on the premises. Two fires occurred that damaged the building, one in 1950 and the other in 1960. The policies of insurance were evidently in the name of Argus Company because it collected for the fire losses and used at least a portion of the proceeds to repair and restore the building.

The brothers, J. E. Mitchell and William Mitchell, were the principal shareholders of Argus Company. Both had been active in the business from the beginning. Together they owned 740 of the 774 shares outstanding. William died March 10, 1945, and J. E. died December 17, 1952. Under date of March 16, 1953, an agreement was entered into by Edwina W. Mitchell, the widow of J. E. Mitchell, J. Orvel Mitchell, a son of J. E. Mitchell by a former marriage, Nannie Mitchell Turner, the widow of William Mitchell, and Frank W. Mitchell, a son of William and Nannie Mitchell. By this agreement the parties agreed to exercise their voting rights as shareholders of Argus Company to elect themselves directors of the company and as directors to elect themselves to the corporate offices therein specified and to further cooperate in other particulars with respect to the operation of the Company. The agreement was followed at the shareholders' meeting in March 1953 and Mrs. Edwina became chairman of the board and treasurer; she was authorized to sign checks along with Mrs. Nannie, the president. Mrs. Edwina was active in the management of Argus Company until ...