Norman v. Durham, 49545

• Citation: 380 S.W.2d 296
• Decision Date: 08 June 1964
• Docket Number: No. 2,No. 49545,49545,2
• Court: United States State Supreme Court of Missouri
• Parties: Kelsey NORMAN and Ruth Norman, Respondents, v. Maynard L. DURHAM and Mary Jo Durham, and the Carthage Loan and Investment Company, a Missouri Corporation, Appellants, The First National Bank of Kansas City, Missouri, Intervenor

Page 296

380 S.W.2d 296

Kelsey NORMAN and Ruth Norman, Respondents, v. Maynard L. DURHAM and Mary Jo Durham, and the Carthage Loan and Investment Company, a Missouri Corporation, Appellants, The First National Bank of Kansas City, Missouri, Intervenor.

No. 49545.

Supreme Court of Missouri, Division No. 2.

June 8, 1964.

Motion for Rehearing or for Transfer to Court En Banc Denied

July 13, 1964.

Charles D. Tudor, and Emerson Foulke, Joplin, for respondents.

Herbert Van Fleet, Joplin, for (defendants) appellants; Seiler, Blanchard & Van Fleet, Joplin, of counsel.

PRITCHARD, Commissioner.

This is an action for declaratory judgment as to the rights of the parties to a joint adventure agreement, dated December 2, 1954, for the development of residential subdivisions in the southeast part of Joplin, Missouri, in which the plaintiffs sought also a direction to the trustee to whom the parties had conveyed their 'pooled' real properties to reimburse them for certain developmental expenses, and ultimately for the partition of 143 lots remaining unsold in the hands of the trustee as between the parties plaintiffs and defendants. The defendants, by answer, sought a declaration of forfeiture of all of plaintiffs' interest in said remaining lots by reason of claimed defaults in plaintiffs' performance of the agreement as per a forfeiture provision thereof. We thus have jurisdiction of this appeal by reason of title to real estate being involved. This case comes to the writer by assignment after reargument was had upon motion for rehearing being granted. As noted below, judgment in the trial court was substantially in accordance with plaintiffs' prayer, and defendants appeal.

The now pertinent portions of said agreement which was between L. S. Durham, Maynard L. Durham and Mary Jo Durham, his wife, and George E. Phelps, Trustee under the will of John E. O'Keefe, deceased, first parties, and Kelsey Norman and Ruth Norman, his wife, second parties, are to the following effect: It is first recited that the parties are owners of certain lands and that 'it is deemed desirable by the parties to combine efforts to encourage development of the area by location of school, shopping center and residences on the lands owned by the parties.' By paragraph 1, first parties agreed to donate approximately 32 acres of land without charge to the School District of Joplin, in consideration of which second parties agreed to convey to first parties or to the Carthage Loan and Investment Company (trustee) certain lots in Southmorland Acres, an addition to Joplin, or in lieu thereof 20 acres of land. Second parties agreed at their expense (a) promptly to plat first parties' land in compliance with city ordinances and to meet FHA and Veterans' Administration requirements as far as practicable; (b) within a reasonable time to open up and gravel either Grand Avenue or Missouri Avenue from 26th Street to 20th Street; to open up 26th Street from Grand to Wisconsin Avenue, to open up Indiana Avenue to at least 28th Street; (c) as to any street which may be opened, gravel and rock piles were to be leveled and mine shafts filled to the rear line of lots adjacent to such streets; * * * and (g) to open up additional blocks as soon as those already opened were substantially disposed of or as market conditions required. By paragraph 4, second parties agreed in the event that under existing ordinances or under applicable regulations of FHA or other lending agencies it was necessary to install sidewalk or curb or gutter or utilities or other improvements before the sale of lots, they would advance the sums necessary therefor but not exceeding one block at a time. Paragraph 5 provided that second parties would advance the sums necessary to satisfy special assessments for sewer, street, gutter or other improvements but only as to lots which had not been sold. In paragraph 6 it was provided that the proceeds of the sale of lots after deducting revenue stamps and the trustee's fee should be distributed by paying first parties $200.00 per acre for streets, alleys and dedicated areas (except the high school dedication) to be allocated to lots and the balance to be first applied to reimburse second parties for expenditures in improving property, and then a division was to be made one-half to first parties and one-half to second parties.

The provision for forfeiture of plaintiffs' rights under the agreement as relied upon by defendants first provides for notice of the violation of the agreement and for termination of the agreement if the violation is not rectified within 30 days. Then as it applies to the claimed default of plaintiffs (second parties), 'the trustee shall immediately convey the property the subject of this agreement or portions thereof remaining unsold to first party, their successors and assigns, and first party their successors and assigns shall be without further obligations to second party under the provisions of this agreement.'

Mr. L. S. Durham died prior to the execution of said agreement and his interest in the property passed by survivorship to Maynard L. Durham; Mr. George E. Phelps died in 1958, and the First National Bank of Kansas City was appointed successor trustee under the will of John E. O'Keefe, deceased; and Mr. Kelsey Norman died on November 12, 1961, while this case was under advisement in the trial court, and his spouse, Mrs. Ruth Norman, became the sole plaintiff herein.

The essential findings and interlocutory decree (designated to be an appealable order by the trial court under Supreme Court Rule 82.06, V.A.M.R.) below were that the trustee, Carthage Loan and Investment Company, upon its request be relieved of all responsibilities or liabilities under said agreement, except to hold bare legal title to unsold lots of the parties in Durham Acres, and that from $35,722.00 held by it as trustee, it deduct $1,197.18 for all its compensation, including attorneys' fees, which was allowed by the court, and which included $97.18 premium for a liability insurance policy on the property of the parties, and that the balance, $34,524.82, be paid to the Clerk of the Court to be by him held pending final disposition of the main cause of action [it being found that defendants were entitled to be reimbursed for 12.82 acres of land at $200.00 per acre pursuant to the agreement, which land had been sold to one White, or $2,564.00, it being found also that other land conveyed into the pool by defendants, the Durhams, should be likewise compensated; that Ruth Norman, as surviving joint tenant to Kelsey Norman, deceased, ceased, was entitled to $10,254.80 reimbursement for developmental expenses paid, and that she also receive one-half, or $10,853.01, and that the defendants Durham and intervenor First National Bank of Kansas City (successor trustee as above stated) were to receive the other one-half, or $10,853.01, of the remaining cash from the trustee]. The court also ordered that partition in kind be had of the remaining unsold lots in Durham Acres: Lots 1 to 50; Lots 75 to 114; and Lots 139 to 191, all inclusive, and appointed three commissioners to set off the same, one-half in value, to each party, and allowed a lien upon the lots set off to Ruth Norman of $200.00 per acre in favor of the defendants.

In our review of this court-tried case we consider both the law and evidence, in nature de novo, but we give due deference to the trial court's findings and opportunity to observe and judge the credibility of the witnesses testifying. Supreme Court Rule 73.01(d), V.A.M.R.; Faire v. Burke, 363 Mo. 562, 252 S.W.2d 289, 290 ; Saville v. Bradshaw, Mo., 359 S.W.2d 676, 678 .

The evidence shows that immediately after the agreement was executed, second parties by Mr. Norman proceeded to have the entire area cleared of brush and trees, and that he at least delineated the streets (Grand Avenue, Missouri Avenue, Iowa Avenue, and the east-west 24th and 26th streets). This work was completed early in 1958. Mr. Norman claimed that Indiana Avenue on the east was at all times 'passable,' with one area toward the north which was impassable in wet weather, as was 26th Street on the south side of the tract. After defendants Durhams conveyed 32 acres to the Joplin High School, the buildings thereon were built, and the school paid for grading Indiana to the south end of its school grounds which is 24th Street. From 24th Street on to the south to 26th Street, Indiana Avenue was graded, graveled and paved by the city of Joplin, to which action Mr. Norman registered protest. Mr. Phelps, as trustee, sold to the Durhams 50 acres of land in the south portion of Durham Acres for $5,200.00, and used that money to purchase from the Durhams a one-fourth interest in the total contract.

Mr. Norman and his wife conveyed to the trustee approximately 20 acres of land (12 lots) in Southmorland Acres, previously owned by him and which abuts Indiana Avenue on the east, north of 26th Street. In 1958, this land was sold to one Ruestman, completely unimproved other than platting, for $44,000.00, which was paid to the trustee upon its conveyance. Apparently a residue of these funds was in the trustee's hands at the time this action was brought on February 24, 1959. Also, shortly after the agreement was executed, the Durhams conveyed their land (including that conveyed to them by George Phelps, trustee), now known as Durham Acres, to the trustee, and this tract was duly platted and the plat was accepted by the City of Joplin on October 17, 1955. On April 12, 1955, Mr. Norman and his wife made a contract with one W. A. White for the sale of lands within Durham Acres, then not platted, by distances, metes and bounds descriptions, and with no improvements thereon, which contract obligated White at his expense to bring to the grade established by the City of Joplin Missouri Avenue, East 25th Street, and to install curbs and gutters on the north side of 26th Street, the...