Longworth v. Kavanaugh

• Citation: 228 S.W. 83,286 Mo. 545
• Decision Date: 18 February 1921
• Docket Number: No. 20786.,20786.
• Parties: LONGWORTH v. KAVANAUGH.
• Court: United States State Supreme Court of Missouri

228 S.W. 83

286 Mo. 545

LONGWORTH v. KAVANAUGH.

No. 20786.

Supreme Court of Missouri, in Banc.

February 18, 1921.

Motion for Rehearing Denied March 5, 1921.

Appeal from St. Louis Circuit Court; William T. Jones, Judge.

Action by James Longworth against William K. Kavanaugh. Judgment for plaintiff, and defendant appeals. Affirmed.

A. & J. F. Lee and James A. Waechter, all of St. Louis, for appellant.

Robt. E. Collins and Edward D'Arcy, both of St. Louis, for respondent.

BROWN, C.

This suit was instituted in the circuit court for the city of St. Louis on March 15, 1905, and has been once before in this court (190 S. W. 315). It was tried to a jury in said circuit court at the April term, 1907, resulting in a verdict for the plaintiff in the sum of $11,293.33, which was 'set aside on motion on the ground that it was against the weight of the evidence. An amended petition was afterward filed and stricken out for variance. Plaintiff declined to plead further, and appealed to this court from the final judgment rendered against him, which we reversed, and remanded the cause. Another trial was begun on March 12, 1917, resulting in a, verdict and judgment for plaintiff in the sum of $11,671.91, from which this appeal is prosecuted. After the verdict and before final judgment, the plaintiff, by leave of court, filed his fifth amended petition as provided in section 1849 of the Revised Statutes 1909. This petition, omitting introduction and formal conclusion, is of the following tenor:

"That during the month of May, 1899, the plaintiff and defendant, William K. Kavanaugh, and John B. Claton, L. R. Willey, W. M. Mitchell, James Y. Lockwood, and other persons whose names are unknown to plaintiff, said unknown persons being represented by the defendant, and cannot therefore be stated, associated themselves together, for the purpose of building, constructing, maintaining, and operating a single or double track railway in and through the county of St. Louis, in the state of Missouri, and for the purposes of such railway of obtaining from the county of St. Louis, in said state, a grant, franchise, or right to build, construct, maintain, and operate such railway; that it was orally agreed by and between the plaintiff and the defendant William K. Kavanaugh that the plaintiff should own and have a one-sixteenth interest or part in whatever rights, property, or interests said association should thereafter acquire.

"That it was thereafter determined and agreed between defendant and his said associates that, instead of endeavoring to secure a franchise from the county of St. Louis to themselves directly, said enterprise should be carried out by assisting another corporation known as the Central Belt Railway Company, a corporation organized under the laws of the state of Missouri and by its charter authorized to build, construct, maintain, and operate a single or double track railway in and through the county of St. Louis and state of Missouri, to secure said franchise, and by making an arrangement with the parties interested in said company for securing to defendant and his associates the control of said Central Belt Railway Company and said franchise and rights.

"That plaintiff, defendant, and their associates did work together with the parties interested in said Central Belt Railway Company to secure said franchise in the name of said Central Belt Railway Company, and the fact that said two interests were working together was well known and understood by said county court of St. Louis county, and said county court desired said co-operation between said two interests in order that there might be sufficient financial backing behind said Central Belt Railway Company to justify the granting of a franchise to it.

"That on, to wit, October 4, 1899, said county court of St. Louis county granted said franchise to the said Central Belt Railway Company for a belt line railway as above set out.

"That, as a result of the plan above set out, the stockholders of said Central Belt Railway Company did on or about October 18, 1890, enter into a contract with defendant, in which it was agreed that the stock of said Central Belt Railway Company should be transferred to defendant, that defendant should reorganize and finance the enterprise of constructing said belt railroad, and that defendant and his associates should own thirteen-sixteenths of said reorganized company, and said Central Belt stockholders should own three-sixteenths thereof.

"That, pursuant to said contract, the stock of said Central Belt Railway Company was, on or about said October 18, 1899, duly transferred and delivered to defendant and his associates, practically the whole thereof being transferred to and issued in the name of William K. Kavanaugh, trustee.

"That on or about March 8, 1900, defendant and those associated with him acquired by purchase from said original stockholders of said Central Belt Railway Company whatever right, title, and interest they still retain in the stock of said company.

"That thereafter and in about the month of March, 1902, defendant and his associates, the then owners of the entire capital stock of the Central Belt Railway Company, caused another corporation to be organized under the laws of the state of Missouri, known as the St. Louis Belt & Terminal Railway Company, which was authorized under its charter to build, construct, maintain, and operate a railway in and through the county of St. Louis, Mo.

"That on or about the 31st day of May, 1902, said association or syndicate, composed of defendant and his associates, caused said Central Belt Railway Company, without consideration moving to it, to assign, transfer, and convey to said St. Louis Belt & Terminal Railway Company the said grant, right, and franchise given to it as aforesaid by said St. Louis county, Mo.

"That during all the above-mentioned times the interest of the plaintiff in the stock of both the Central Belt Railway Company and the St. Louis Belt & Terminal Railway Company were held by defendant in his own name, but for the use and benefit of the plaintiff.

"That from the time the capital stock of said Central Belt Railway Company was, about October 18, 1899, placed in the name of defendant and his associates, as aforesaid, defendant and his associates other than plaintiff were in control of said stock and of the operations of said company, and were also, from the time of the organization of said St. Louis Belt & Terminal Railway Company, in control of the stock, or a large part thereof, and of the operation of the said St. Louis Belt & Terminal Railway Company.

"That later, to wit, by a contract dated July 1s, 1902, and finally consummated on October 1, 1902, the defendant and those acting with him in control of said corporation sold all of the stock then issued of the said St. Louis Belt & Terminal Railway Company to the Terminal Railway Association of St. Louis, a corporation, and received in payment therefor, and for promoter's fees, the sum of $210,000, one-sixteenth part of which belonged to and was the property of the plaintiff; that said entire consideration of $210,000 was by said Terminal Railway Association of St. Louis paid to and received by the defendant. Said Terminal Railway Association of St. Louis, as part of the purchase price of said stock, further assumed and agreed to pay, and did pay, all outstanding debts and liabilities of said St. Louis Belt & Terminal Railway Company.

"That by reason of the premises the defendant became and was indebted to the plaintiff in the sum of $13,125, and on or about the 2d day of October, 1902, the plaintiff demanded from the defendant the payment of his said share in the proceeds of said sale, amounting as aforesaid to the sum of $13,125, but the defendant failed and refused, and still fails and refuses, to pay the same or any part thereof to the plaintiff."

It concludes with a prayer for judgment. The answer is a general denial. At the close of plaintiff's evidence and again after the evidence was all in the defendant asked that the jury be instructed peremptorily to find for defendant, which was refused, and defendant duly excepted.

The court gave the following instructions for plaintiff:

"The court instructs the jury that, if they believe and find from the evidence in this case that during the month of May, 1899, the defendant, W. K. Kavanaugh, and the plaintiff, together with other persons, associated themselves together for the purpose of building, constructing, maintaining, and operating a single or double track railway in and through the county of St. Louis, in the state of Missouri, and, for the purposes of such railway, of obtaining from the county of St. Louis, in the state of Missouri, a grant, franchise, or right to build, construct, maintain, and operate such railroad, and that it was orally agreed by and between the plaintiff and the defendant, W. K. Kavanaugh, that the plaintiff should own and have a one-sixteenth interest or part in whatever right said association or syndicate should thereafter acquire, and if you further find and believe from the evidence that it was thereafter determined by defendant and his associates that, instead of endeavoring to secure a franchise from the county of St. Louis to themselves directly, said enterprise should be carried out by assisting the Central Belt Railway Company to secure said franchise, and by making an arrangement with the parties interested in said company for securing to defendant and his associates the control of said Central Belt Railway Company and said franchise and rights, and if you further find and believe from the evidence that it was known by said county court the said two interests were working together to secure said franchise in the name of said Central Belt Railway Company, and that said county court desired said co-operation in order that there might be sufficient financial backing behind said Central Belt Railway Company...