Northwest Missouri State Fair, Inc. v. Linville

• Decision Date: 01 December 1969
• Docket Number: No. 25088,25088
• Citation: 448 S.W.2d 274
• Parties: NORTHWEST MISSOURI STATE FAIR, INC., a corporation, Respondent, v. Leo LINVILLE, Appellant.
• Court: Missouri Court of Appeals

Page 274

448 S.W.2d 274

NORTHWEST MISSOURI STATE FAIR, INC., a corporation, Respondent, v. Leo LINVILLE, Appellant.

No. 25088.

Kansas City Court of Appeals, Missouri.

Dec. 1, 1969.

Robert L. Ross, Albany, for appellant.

R. E. Moulthrop, Bethany, for respondent.

SHANGLER, Judge.

Plaintiff Northwest Missouri State Fair, Inc., lessor of certain premises in Bethany, Missouri, brought suit for a declaratory judgment against Leo Linville, Charles Hoops and William McIntosh, its lessees. Plaintiff sought a judicial determination of the terms of that lease, a declaration of the rights and obligations of the parties under it and an adjudication that the defendants had no further right to operate upon the premises under its terms.

Defendants Linville and McIntosh filed their answers to the petition; defendant Hoops defaulted. The issues were tried to the court. The court made two factual findings: (1) That the lease was valid; (2) That the lease was negotiated and executed by the individual defendants, Linville McIntosh and Hoops either as agents or trustees for Bethany Livestock Auction, Inc. (not a party to the suit) or, alternatively, that the lease was assigned 'as a matter of fact to said corporation by act and deed of the individual defendants' to which transfer of interest the plaintiff acquiesced. Thereupon, the court adjudged that the lease was valid and that defendants Linville, Hoops and McIntosh had no right, claim or interest in it. Defendant Linville, only, appeals from that judgment.

Appellant Linville ties the efficacy of this appeal to a lapse in plaintiff's pleading. He does not actually attack the judgment, as such. Rather, although acquiescing in the court's finding (and that part of its judgment) sustaining the validity of the lease, he contends that the alternative findings of fact were erroneous because: (1) The findings that defendants either executed the lease as agents or trustees for Bethany Livestock Auction, Inc. or assigned it to Bethany after its execution were on issues not raised by the pleadings or responsive to them; (2) They were inconsistent with plaintiff's pleaded theory of a breach of a subsisting lease by defendants as lessees in their own right; and, (3) As Section 432.060, V.A.M.S., requires an assignment of a lease to be in writing, the court's finding of an assignment by 'act and deed' was not sufficient to satisfy the statute. We affirm the judgment. Our statement of reasons follows.

The facts essential to the determination of this controversy are not in dispute. This, notwithstanding a plethora of evidence presented to prove, and refute, an alleged breach of the lease terms by defendant Linville's failure to properly maintain the premises. Plaintiff contended it was thereby effectively prevented from conducting feeder calf sales on the premises, a use reserved to itself under the lease. The court made no finding on that issue. It was not essential to the judgment, and we make no further reference to it.

Some time prior to its effective date of June 1, 1960, the parties entered into the lease in question. It was for a term of ten years with multiple options to renew. The lease itself, including its assignment provisions, contemplated the expenditure of a substantial sum of money to adapt the building for livestock auction purposes. In April, 1960, the three defendants, as original incorporators of the Bethany Livestock Auction, Inc., subscribed to its articles of incorporation. They deposited $25,000.00 or more in a bank fund which served to pay for the improvements to the premises as contemplated by the lease terms. In May, 1960, the certificate of incorporate issued and the stock certificates in Bethany Livestock were distributed among the several defendants according to their respective financial interests. From May 20, 1960, forward, it was admitted that Bethany assumed the operation of the barn sales. Defendant Linville eventually became its president and manager. In May, 1960, as well, after the execution of the lease but before its effective date, livestock sales were initiated on the premises. These sales were conducted by Bethany Livestock, the only licensed market on the premises during the entire period of our concern. It was admitted, as well, that from the initial occupancy until suit was filed in December, 1966, all rents accruing under the lease were paid by Bethany Livestock exclusively and none individually by appellant or any other person. For each such remittance, plaintiff issued its receipt to Bethany Livestock, the source of each payment. Eventually, each of the individual defendants, Linville, Hoops and McIntosh, alienated his interest in Bethany Livestock by sale of stock and transfer of certificate to either Don England, Earl Sturgeon, or both. Linville consummated the sale of his shares of stock on November 4, 1964. He contracted, concurrently, with his transferees for the use of the premises for horse sales and promised to pay them $50.00 for each such sale. The obligation to perform under that agreement continued up to the date of the filing of this action.

A ready understanding of those points of alleged error raised by appellant, and previously listed, requires some reference to the pleadings. Paragraph IV alleged, inter alia, that 'plaintiff entered into an agreement denominated a lease, with all of the defendants', a copy of which lease was attached to the petition and incorporated into it by reference. Paragraph VI, the provisions of which appellant pointedly brings to our notice, alleged the default in payment of rent by all the defendants, that defendants Hoops and McIntosh had vacated the premises and that they had been permitted to fall into a state of disrepair and deterioration. It also alleged that defendant Linville had for some time operated a horse sale of 'many ill and decrepit animals' and that the premises had been allowed to deteriorate. Finally, Paragraph VII alleged the lease agreement to have been 'wholly abrogated and * * * void, a nullity and of no force or effect and this plaintiff is entitled to the premises referred to therein free of any claims of any of the defendants'.

Appellant's ensuing argument, attacking the court's alternative finding, involves the following logical progression: Plaintiff's petition alleges defendant Linville to have been its lessee under the pleaded lease. Such an admitted fact must be taken as true against the pleader as it amounts to a judicial admission of that fact. The court's alternative finding that defendant Linville had executed the lease as an agent or trustee for Bethany Livestock necessarily implies that Linville was never a lessee in his own right. Such a finding is inconsistent with plaintiff's pleaded allegation that Linville was a lessee. As the fact that Linville was the lessee was admitted by plaintiff by so having pleaded it, plaintiff is estopped to adopt a position inconsistent with that judicial admission. Therefore, appellant concludes, that alternative finding is erroneous as not responsive to the pleadings and the judgment for plaintiff must be overturned.

A parallel argument is made with respect to the court's alternative finding that appellant and the other defendants assigned the lease as a matter of fact to Bethany Livestock by 'act and deed'. We do not expound that argument further as our response applies with equal validity to each of appellant's points.

Appellant's argument is based upon a misconception which pervades his brief, as well. Assuming without deciding, that the alternative finding that Linville was an agent or trustee for Bethany Livestock is inconsistent with the pleaded fact of the execution of the lease by him individually, yet such an inconsistency does not and cannot impair a judgment correctly reached in favor of the right party. Our de novo review prompts the conclusion that the court's judgment was correct. Its validity was not impaired even though any and all of the findings may have been erroneous. The reasons a court may ascribe in support of its judgment do not govern its correctness; the result does. Southwest Engineering Co. v. Reorganized School Dist. R--9, Mo.App., 434 S.W.2d 743, 750. This principle applies, as well, to a declaratory judgment action. Edgar v. Fitzpatrick, Mo.Sup., 377 S.W.2d 314.

In any event, the rule relied upon by appellant that a fact admitted in the pleadings must be taken as true against the pleader as a judicial admission of that fact (State ex rel. Boatmen's National Bank of St. Louis v. Webster Groves Genl. Dist. No. 1 of St. Louis County, 327 Mo. 594, 37 S.W.2d 905, 908; M.F.A. Mutual Insurance Co. v. Hill, Mo., 320 S.W.2d 559) does not apply for yet another reason. We have concluded that the trial court, in effect, allowed plaintiff to amend its petition at the...