Memmel v. Thomas

• Decision Date: 05 June 1944
• Citation: 181 S.W.2d 168,238 Mo.App. 403
• Parties: Joseph F. Memmel, Appellant, v. J. L. Thomas and Arline Thomas, Respondents
• Court: Kansas Court of Appeals

181 S.W.2d 168

238 Mo.App. 403

Joseph F. Memmel, Appellant, v. J. L. Thomas and Arline Thomas, Respondents

Court of Appeals of Missouri, Kansas City

June 5, 1944

Appeal from Moniteau Circuit Court; Hon. Sam C. Blair, Judge.

Reversed and remanded.

W. H Martin and Embry & Embry for plaintiff.

(1) Appellate court must determine whether judgment was proper regardless of theory upon which based. Southern Surety Co. v. Goltra, 9 S.W.2d 661. (2) In determining whether defendants' demurrer to evidence should have been sustained, facts must be considered in light most favorable to plaintiff, who is entitled to benefit of all reasonable inferences therefrom. Bowman v. Moore, 167 S.W.2d 679. (3) The probate court had authority to direct the administrators to deliver the note to plaintiff who upon acceptance became the trustee of an express trust. Sec. 241 R. S. Mo. 1929 (Now Sec. 240, R. S. Mo. 1939). Transfer of note without endorsement vests title of transferrer in transferee. Sec. 2677, R. S. 1929 (Now Sec. 3064, R. S 1939). Holder of a negotiable note may sue thereon in his own name; and payment to him in due course discharges the instrument. Sec. 2679, R. S. 1929 (Now Sec. 3066, R. S. 1939); Walker v. Hayes, 25 S.W.2d 523; Welcker v. Hayes, 22 S.W.2d 1052; Bocka v. Nuella, 28 Mo. 181; Wright v. Wayland, 188 S.W. 930. The holder of the legal title to a cause of action is the proper party to bring suit thereon, even though he has no beneficial interest in the cause of action. Sec. 699, R. S. 1929 (Now Sec. 850, R. S. 1939); Snider v. Adams Express Co., 77 Mo. 527; Nicholay v. Fritschle, 40 Mo. 67; Keeley v. Indemnity Co. of America, 7 S.W.2d 437; Stilwell v. Glascock, 47 Mo.App. 557; Young v. Hudson, 12 S.W. 633; Barber v. Stroub et al., 85 S.W. 916. The word "owner" has no precise legal significance and may be applied to any defined interest in a thing. Gitchell v. Kreidler, 84 Mo. 476. (4) The payment by Thomas to Meistrell of $ 1250 in compromise and settlement of the three notes outstanding totaling $ 2500 in unpaid principal did not extinguish defendant's liability thereon. Sec. 234, R. S. 1929 (Now Sec. 233, R. S. 1939); Wayland et ux. v. Pendleton et al., 337 Mo. 190, 85 S.W.2d 495; 2 C. J. 578; 2 C. J. S. 1228. The payment of an amount less than due on due or past due notes even though made with the agreement that such payment is in full satisfaction, does not release the debtor from the balance due. Stephens v. Curtner, 222 S.W. 498; Wayland v. Pendleton, 85 S.W.2d 494-5. (5) The admission of the letter from plaintiff to defendant, J. L. Thomas, dated November 19, 1940, was error as the letter constituted no defense. It was not a renunciation and there was no renunctiation pleaded as a defense. Sec. 2750, R. S. 1929 (Now Sec. 3137, R. S. 1939); Nelson v. Hudson et al., 299 S.W. 1112-3. (6) The inventory of the estate of A. H. Sauter should have been admitted in evidence, having been identified as original inventory and constituting competent evidence to show chain of title in view of answer denying ownership of plaintiff individually or in a representative capacity. Sec. 1864, R. S. 1939; Galli v. Wells, 239 S.W. 894; Williams v. Mitchell, 20 S.W. 649; 22 C. J. 796.

J. B. Gallagher and Roy D. Williams for respondents.

(1) Plaintiff showed no title in himself. Suits must be brought by the real party in interest subject to the exceptions in Sec. 850, R. S. 1939. Section 849, R. S. 1939. (2) Section 850 requires the trustee to sue in his official or representative capacity. Section 850, R. S. 1939. (3) The verdict was properly directed as neither of the above requirements were met. Harny v. Dutcher, 15 Mo. 89; Miles v. Davis & Taylor, 19 Mo. 408; Draper v. Farris, 56 Mo.App. 417; Snider v. Adams Express Co., 77 Mo. 523; Missouri Wesleyan College v. Shulte, 346 Mo. 647, 142 S.W.2d 644, 647; Struss v. Zollman, 153 S.W.2d 65, 67; Wilson v. Polk Co., 112 Mo. 126, 138; Weituechter v. Miller, 276 Mo. 322, 331; Headlee v. Cloud, 51 Mo. 301; Pattison, Mo. Code Pleading (2 Ed.), sec. 270. (4) The probate court has no authority to appoint plaintiff as trustee except in accordance with Sec. 240, R. S. 1939.

Sperry C. Boyer, C., not sitting.

OPINION

SPERRY

This is a suit on a note. At the conclusion of plaintiff's evidence the court indicated that he would sustain a demurrer. Plaintiff took an involuntary nonsuit with leave to file motion to set aside. His motion was overruled and plaintiff has appealed.

The petition alleges as follows:

"The plaintiff states that the defendants, by their promissory note herewith filed marked Exhibit "A" dated February 15, 1924, promised to pay to the order of J. L. Meistrell the sum of One Thousand Dollars ($ 1,000), five years after date, with interest from date at the rate of six per cent per annum, payable annually, until maturity, and at the rate of eight per cent per annum after the same becomes due. That the maturity of said note was extended to February 15, 1932, and that the defendants, have paid interest on said note to the 15th day of February, 1932.

"That the plaintiff is the owner and legal holder of said note; that the principal of said note, with interest thereon from February 15, 1932, at the rate of eight per cent compounded, is now due and unpaid."

Defendants, by their answer, denied that plaintiff, either personally or in his representative capacity, is the owner of said note; and alleged that the note had been compromised, settled, paid and discharged.

Plaintiff, by reply, denied that said note had been compromised and settled.

Plaintiff's evidence was to the effect that the note in question was found in the lock box of A. H. Sauter, after his death; that Sauter died May 21, 1931; that in said box was a written instrument signed by W. W. Kingsbury for himself and for J. L. Meistrell purporting to assign and transfer said note to A. H. Sauter; that Meistrell and Kingsbury were partners in financial transactions; that plaintiff and a Mr. Fischer became and were the administrators of the estate of Sauter, deceased; that thereafter, upon request of the heirs of Sauter, the probate court made an order directing said administrators to turn over certain assets of said estate which had not been liquidated or distributed (including the note in question) to plaintiff, and it is admitted here that plaintiff came into possession of the note by force of said probate court order.

The note was introduced in evidence and shows that same was signed by defendant, dated February 15, 1924, payable to J. L. Meistrell, and that interest was paid thereon to February 15, 1932, the last interest payment having been made by Meistrell and noted thereon by him. No other payments are shown thereon.

The probate court order above mentioned is founded on Section 240, Revised Statutes Missouri 1939, which is as follows:

"Property not sold or partitioned in kind -- how disposed of. If such property cannot be divided in kind with advantage to the distributees, and it would not be to their advantage that the same be sold by the executor or administrator, then upon the application of a majority of those entitled to distribution, the court shall order the same to be delivered to such person as they shall designate, in which selection minors shall act by their guardian, who shall proceed to collect, by suit or otherwise, all notes, accounts and choses in action so received in the name of the distributees, and dispose of all property so coming into his possession or under his control to their best interests, collecting the proceeds thereof, and distribute all moneys realized to the parties entitled thereto. Such person may, in the discretion of the court, be required to give bond to the state of Missouri, with good securities, in such sum as the court may deem proper, for the faithful discharge of his duty, and for payment of parties entitled thereto of all moneys collected. Said party may be discharged from said trust upon his application, or upon the application of a majority of said heirs, when it appears to the probate court that it will not be for the interest of distributees that said trust be continued." (Emphasis ours.)

It is plaintiff's contention that the legal effect of the above-mentioned probate order, and of plaintiff's possession of the note pursuant thereto, is to create a trust of which the note forms a part, and of which plaintiff is the trustee.

"To get at the true meaning of language employed in a statute the court must look at the whole purpose of the act, the law as it was before the enactment and the change in the law intended to be made." [Pembroke v. Houston, 79 S.W. 470, 180 Mo. 627, l. c. 636; Young v. Hudson, 12 S.W. 632.] We should also consider the results of the construction suggested, it being presumed that the Legislature intended a reasonable construction which will permit of beneficial results. [Darlington v. Missouri Pacific, 216 Mo. 658, l. c. 672.]

Prior to the enactment of this section administration of an estate could only be closed out after all assets were liquidated, or distributed in kind. No doubt it was to correct this condition that the section was enacted. [Rutledge v. Simpson's Adm'r., 42 S.W. 820, l. c. 821.]

The language of the statute indicates that the Legislature had in mind the creation of a trust. The word "trust" is twice used therein. Indeed, the assets mentioned therein are specifically referred to as a trust. The Legislature intended that a trust of such assets be created in the manner prescribed; and having provided for the appointment of a person to administer same, it follows that plaintiff herein became and is the trustee of the trust created by act of the probate court under and by virtue of this section. We think the above...